Sophisticated Europeans are looking at properties in and around Auckland and not just because they fancy a stunning holiday home - it’s also because New Zealand is on the other side of the world.
They see New Zealand as safer than other parts of the world, says Michael Boulgaris, agent to the rich.
“They tell me stories that when you’re wealthy, internationally your number one concern is your children being kidnapped, cause that’s where the ransoms are so when they come to New Zealand they just blend in," he says.
“I’ve had that said so many times. I’ve heard stories - my clients tell me if you wear a Rolex, you’re walking down the street through somewhere in Europe you might get your hands chopped off. It’s just frightening - they’re scared.”
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Boulgaris says in the last 12 months, and more so in the last quarter, he has seen an increase of people coming to New Zealand to look for property.
Some are expats but others are from European countries like France, Sweden and the Netherlands.
Because of the foreign buyer ban introduced in 2018, international buyers must have residency and Boulgaris has sold properties to internationals who already have residency.
The ones who buy at the top end of the market have “houses scattered all around the world”, he says.
Others investigate whether they can get residency - but not being able to has scuppered some deals.
Boulgaris says he has just put Delamore Lodge, a Waiheke Island hideaway where international celebrities stay, back on the market (in the $10m-plus range) after contracts to buy the lodge did not complete.
Waiheke Isalnd is the type of Kiwi paradise that excites European buyers. Photo / Getty Images
“The buyers couldn’t get residency to settle. See, that’s a difficult one. So many foreigners want to buy that property but because Waiheke’s sensitive land it triggers the Overseas Investment Act and they just can’t get the funds, they can’t get the residency to settle.”
The luxury boutique lodge has 2.35ha of freehold land, a helicopter pad, a world-renowned infinity pool, separate self-contained suites with balconies and ocean views.
Boulgaris says international buyers “are out there alright”, and New Zealand this week features in a New York Times report, targeting “wishful foreign investors and vacation house hunters”, by putting us in the top 15 countries where house values are rising the most.
Number one is Hong Kong, where in ten years prices have risen 193 per cent, with New Zealand at number 15 with a 71 per cent increases in home values.
The Times report points out buying internationally can be complex and “fraught with unexpected hurdles” and recommends people consult financial, legal and real estate professionals.
The latest OneRoof housing market figures show Auckland house prices are rising rapidly again, after a three-year-long slump.
OneRoof editor Owen Vaughan says: “Figures for the quarter showed growth in all of parts of the city bar one region –Rodney – but even so, values were flat. The reversal of fortunes for the country’s biggest housing market was evident in the strong finish to 2019.
"Enhanced confidence and expectations that the low interest rates are here to stay have been the main growth drivers, but adding fuel to the market are several factors specific to Auckland: increased buyer demand within certain locations and price brackets and a shortage of listings within the $800,000 to $1.1m bracket within city fringe locations."
Boulgaris says overseas clients have told him their number one concern is the safety of their children. Photo / Getty Images
"That said, several high-profile homes in Auckland have achieved top prices in the last six months, with several wealthy returning expats snapping up homes for more than $5m."
In Queenstown, which has reportedly been viewed as a bolthole by rich Americans fearing global disaster, the foreign buyer ban has slowed down the market in the top-priced homes, although there are fewer buyers for these homes anyway, says Brendan Quill of Colliers.
“It’s just got so much harder with the (Overseas Investment) Act. It’s a massive big curtain that’s put in front of you - it’s a wall, really, not a curtain.”
Having said that, the $5m and under market has seen plenty of activity from New Zealanders and Australians. There are international flights out of Queenstown and it’s only a hop, skip and jump from Australia. “We’ve become pretty much a suburb of Australia with those international connections,” says Quill.
