The Green Party’s concern that foreign speculators are making it more difficult for would-be first home owners to buy a property has prompted co-leader Russell Norman to call for a ban on foreign ownership.
“We believe land should be owned by New Zealand citizens and residents only and our laws should be changed to say that,” Dr Norman said.
“Why should we allow Singaporean, Australian or American speculators to buy investment properties in our country, shutting first-time home buyers from the market.”
The question of whether overseas buyers were making it difficult was discussed at a recent farm forum. The panelists – two farmers, an accountant and a farm advisor, were adamant that foreign investment in land was a good thing.
If it boosted prices, vendors recieved more for their properties which they were able to reinvest elsewhere in the economy.
The new owners farmed the land so that they and/or their staff became part of the community contributing not just economically but socially too. If they chose not to keep the farm, it was put on the market and available for another purchaser from New Zealand or elsewhere because no matter who owns it, they can’t take land away.
What people do with land is a matter for local and central governments through district and regional plans and the Resource Management Act. Foreign owners already have to satisfy the Overseas Invesment Commission before they buy farmland and that is a sufficient hurdle.
Norman isn’t talking about farm land though, he’s talking residential property where the market has already slowed up, even in North Otago which has been insulated from the recession by the positive influence of dairying.
Banning foreign investors would only add to the difficulties would-be vendors are already facing and slash the value of investments people have made in their homes.
Update: Bernard Hickey blogs at Show Me the Money that house prices in Mt Eden/Epsom have fallen 30.4% in the three months to July.