Reasons to Invest in New Zealand Property

There are many reasons to invest in New Zealand including:

  • Population Growth: A growing population, declining household sizes and rising incomes will contribute to continued growth on the New Zealand rental market. As demand for dwellings continues to outpace supply.

  • A strong rental demand: In 2006 33.1 per cent of households did not own the dwelling they lived in, up from just 26.2 per cent in 1991and by 2016 it is projected to increase to 38.1 per cent by 2016.  In 2001, of New Zealand's main urban areas, central Auckland had the lowest rate of home ownership at just 55.7 per cent. Auckland rental yields are around 5 - 6 per cent.

  • Portfolio Diversification: It's not uncommon for international investments to be rising while local ones are falling or vice versa.  Diversifying into international markets can have significant advantages.

  • Favourable depreciation policy: Depreciation is roughly 3-4 per cent of the total property value per annum.

  • Affordability: Investors can purchase excellent rental properties in Auckland under $400,000 (approximately GBP£147,000 or USD$301,000).**

  • Investor friendly tax policy: no 'stamp duty' or capital gains tax on investments*.

  • Favorable bank policy: Banks will loan up to 90 per cent providing a strong credit rating and suitable income/assets are available. Local lending rates are around 7.5-8 per cent.

  • Steady Capital Growth: Auckland property owners experienced an average increase of 10 per cent per annum for the past 20 years.  In 2004 prices increased by 20 per cent. The Auckland property market is a secure long-term investment.

  • Tax Credits: A New Zealander living abroad is able to build tax credits.

     

* depending on the country of residence
**  Properties subject to availability. Foreign currency indicative rates as at 02-10-2007, subject to exchange rate fluctuations.