Chinese property site sees spike in interest in Kiwi properties

Chinese property site sees spike in interest in Kiwi properties
Photo credit: Getty

Chinese real estate website Juwai has extended its promotion of New Zealand houses due to increased interest from buyers.

The site has seen a 35 percent increase in inquiries since Prime Minister Jacinda Ardern announced the Government would ban foreign buyers from purchasing existing homes in New Zealand.

Juwai CEO Carrie Law told Newshub there was a spike of inquiries in December and January compared to November, with buyers aware that they need to get in before they are barred by the new legislation.

"New Zealand's proposed policy change has activated Chinese buyers who already had plans to purchase in the country and now realise they need to act more quickly on transactions that otherwise could have taken many months," she said.

Juwai launched a campaign for the month of December to connect Chinese buyers to property marketers and vendors, and it has now been extended into February. 

"These buyers previously took their time in researching their transaction and want to act now before it is too late," Ms Law said.

"We hope to drive more buyers and visibility to the properties in New Zealand that are having trouble finding buyers."

The promotional campaign is limited to 40 customers, and despite the increase in interest Juwai was not able to provide data about how many sales resulted from the campaign.

Ms Law expects that once the ban is fully implemented, Chinese buyers will move towards purchasing new dwellings off a plan before construction has started.

"Developers get the reassurance they need to get financing and start building. Then when the project is built, local buyers snap up the majority of the units in a building that would not be there if it weren't for the Chinese," she said.

She sees the legislation as a good opportunity for the country to use Chinese investment to boost new development, and help to ameliorate the housing shortage.

The legislation, an amendment to the Overseas Investment Act, passed its first reading in December and is at the select committee stage.

While the Government said foreign buyers could make up to 20 percent of house sales, National argued that the figure is closer to 3 percent.

Under the new law only New Zealand and Australian citizens will be exempt from screening from the Overseas Investment Office when purchasing an existing home.

Associate Finance Minister David Parker said the Government will encourage foreign investment where it benefits New Zealand businesses and communities.

"But investment in existing homes by those who have no right to reside here, and no intention to live here, does not achieve that objective unless they add to housing supply."

The Government is currently negotiating with Singapore as a free trade agreement will be affected by the ban, which could result in an exemption for the country.