Kerre Woodham: What did it cost to get the foreign buyers clarification?

You might remember, those of you who were listening around about a month ago when the Prime Minister was in the studio, taking your calls. Steve rang in and gave the PM a bit of ginger over the economy. He said, "I know you're between a rock and a hard place, Prime Minister, with the economy. Not really any more levers you can pull to do much, and you guys are just treading water. It's a PR machine to gloss over while you pray that somehow the economy's going to pick up."  

He said to the Prime Minister, "There's one lever you have yet to pull, and I think you know that for the short-term sugar that will bring something into this economy, that's a foreign buyers' ban. If that comes off, you know that will bring a bit of money in, and that will have a proper, tangible effect rather than just being all talk, talk." But of course, that's not going to happen with Winston.  

CL: On foreign buyers, that is a conversation that Winston and I are having, so watch this space. Let's see whether we can make some progress through that one.  

KW: Interesting. How will you get him to change his mind? What bauble are you able to offer?  

CL: No, no, no. I think actually both of us recognise that if people are going to come to this country and make an investment and partner with a New Zealand company, you know, think about a technology person in San Francisco wanting to come out here. They don't want to rent a house in Auckland. They want to be able to buy a house, and you think about what's happening in places like Tara Iti up the road from Auckland. You've got massive investment, 140 Americans here building, you know, $20 million plus homes, all that sort of stuff. So there has to be a way through that. So, you know, watch this space. It might be a bit more positive than Steve thinks.  

And what do you know? That was on the 7th of August. We watched the space, and on the 1st of September, the announcement came. Foreigners spending $5 million on approved investments in exchange for residency visas will be able to buy homes. But not just any old tat. They will only be able to buy homes that are $5 million plus.  

The Prime Minister said the changes aim to attract rich immigrants who find the thought of having a home in New Zealand attractive, without opening the market to widespread foreign property ownership. And he's right. I mean, there are some Kiwis looking at the $5 million plus homes, but it's not me. Is it you, Helen? No. No, she's not in the market for a $5 million home. Young Olivia, who's just joined us, no. No, she has yet to buy her first home, so it won't be in the $5 million plus category. It is not the majority of us, I would venture to suggest. And apparently, offshore buyers have responded immediately. High-end real estate agents say the word has gone out that New Zealand is welcoming people back into the country – but then you become a high-end real estate agent by talking up the market, don't you? So, you know, but you take them at their word.  

The word goes out from the Prime Minister that if you want to come to New Zealand and you want residency, guess what? You can buy a house, which makes sense. But it's got to be $5 mil plus, which for some people is what they would spend on a bach. You know, these kinds of high-end investors, it's the sort of money you'd spend on a bach in New Zealand.  

The Labour-New Zealand First coalition banned most foreign buyers in 2017 out of a belief they were contributing to skyrocketing house prices. The New Zealand First of that coalition is now the New Zealand First of this coalition that has reversed that ban. But Winston Peters is adamant that the ban actually remains. He says, "We have ensured that there are tight restrictions on eligibility and on what these current residence visa holders can purchase," including that existing restrictions, excluding the sale of rural farm and sensitive land, will still apply, as well as ensuring we don't get a repeat of the Canadian experience where there is a constant recycling of the same investment funds.  

The visa holders will be restricted to only one home, either purchasing an existing home or building a new one, with the value of that home being a minimum of $5 million. This will exclude over 99% of New Zealand homes on the market, protecting the vast majority from sale to foreigners and will not affect the wider housing market for Kiwis. He says that New Zealand First supporters understand that this is not a U-turn, that the ban remains – except it doesn't. The ban remains except for those who are buying houses over $5 million. So, shall we call it a clarification, Winston? Not a ban per se, just a clarification.  

Is he right? If you are dyed-in-the-wool anti-immigration, and you swallow a dead rat, as Winston has done, by accepting migrants who can afford to drop $5 million in investment money and $5 million on a new pad? Are those migrants okay? The ban in general remains, but for a very few people in the rarefied position of having $10 million to spend, then they are welcome, the welcome mat is there for them.  

So, the only thing that really does make me wonder is what Christopher Luxon and possibly David Seymour had to give Winston Peters to get this over the line? That experienced old horse trader doesn't give it up for nothing. You know, you want it, you pay for it. So, I want to know what the cost was to get that, let's not say U-turn, let's not say reversal, let's say clarification.  

And I also want to know what New Zealand First voters think. I know you love him, you'd follow him over the trenches. There's no man like Winston. He's probably up there next to Michael Joseph Savage on the wall, the framed print with some plastic roses in a vase underneath, gathering dust. But do you understand that he has made this decision for the right reasons? To me, it makes sense. I'm sure there will be some cashed-up Kiwis who are a little brassed off that their dream home may now go up in price by half a million dollars more because you've got foreign buyers bidding on the same property. But I'm not going to cry in my cornies over them. There's not going to be that many affected. So, I get where they're coming from, I just want to know how much it cost National and Act to get New Zealand First agreement because you don't get something for nothing. 

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