Wealthy Chinese binge buying NZ real estate, locals anxious
Staff Reporter 2012-12-08 17:23
Auckland's Chinese community celebrates the founding of the People's Republic of China in 2009. (Photo/Xinhua)
China's wealthy are hurriedly buying up real estate in New Zealand at inflated prices raising concerns from locals who are calling for the national government to tighten the rules on purchases by nonresident investors, reports Duowei News, an outlet operated by overseas Chinese.
New Zealand is one of the few countries in the world which does not set impose strict limits and additional taxes on foreign nationals who wish to buy local property. The policy, viewed favorably compared with other advanced Western nations, has attracted the attention of China's wealthy elite.
A realtor at one of the biggest real estate brokers in New Zealand told Duowei that he has sold 11 luxury houses collectively valued at more than 15 million yuan (US$241 million) just this year. Only four were bought by local people; seven were purchased by overseas nationals.
Wealthy Chinese are the favorite customers of realtors, the source said. Not only do they have cash, they reach decisions very quickly. Some Chinese buyers came to New Zealand as part of tour groups and used free time in the evenings to hunt for local property. One agreed to buy a multi-million luxury property nearly immediately after laying eyes on it.
A story in the New Zealand Herald said a three-bedroom house in Auckland, the largest and most populous urban area of the country's North Island, had an estimated market value of NZ$670,000 (US$552,000), but was sold at auction for an incredible NZ$1.08 million (US$895,000). The house is located in an area popular among Chinese buyers.
More local homeowners are choosing to sell their properties through auctions to attract Chinese buyers who, many locals have witnessed, bid significantly higher than the market price.
Many local people complain it is becoming more difficult for them to buy a house as Chinese coming from abroad can simply outgun them financially to secure the properties they want.
Some even suspect wealthy Chinese investors are deliberately manipulating the price of local properties, and are often not welcomed -- not only by locals but also new Chinese residents and local ethnic Chinese New Zealanders.
Amid all this, the government is hearing calls for it to limit the number of properties going to foreign properties. To be sure, the country's central bank said it is closely monitoring housing price fluctuations in large cities such as Auckland and Christchurch, concerned the price surge will go unabated as more and more Chinese emigrate to the country.
