- Hon Chris Bishop
The coalition Government has passed legislation to support overseas investment in the Build-to-Rent housing sector, Associate Minister of Finance Chris Bishop says.
"The Overseas Investment (Facilitating Build-to-Rent Developments) Amendment Bill has completed its third reading in Parliament, fulfilling another step in the Government's plan to support an increase in New Zealand's housing supply and get Kiwis into warm and dry homes.
"The changes provide a streamlined consent pathway for foreign investors looking to invest in existing Build to Rent developments.
"This Bill addresses a key concern of BTR developers - that they need certainty they will be able to on-sell their developments. Given the size and complexity of these assets, this can be challenging when limited to the domestic market.
"The Build to Rent sector has real potential for growth in New Zealand.
"Build to Rent developments are medium-to-large scale rental properties, typically well located and often within walking distance to key transport links. The developments tend to be professionally managed, with good amenities. Often offering longer leases to tenants, they can be a popular choice for renters.
"They are a relatively new form of rental housing in New Zealand but are well established overseas.
"BTR developments are often financed and operated by institutional investors and developers (such as pension funds), as they offer long-term, stable returns.
"However, to date Overseas Investment Act settings have been holding back growth in the sector and made investment challenging.
"Under the Act, it is difficult for overseas investors to invest in existing Build to Rent assets. There are a limited number of domestic investors with the capital and expertise to run these developments, and as a result developers in New Zealand have been uncertain as to whether they would be able to sell their assets when they choose to exit their investment.
"Under the new pathway, overseas investors will be able to apply to purchase existing Build to Rent developments with at least 20 dwellings, provided they intend to continue to lease these.
"These changes mean BTR developers will have confidence in their ability to eventually exit their investment, meaning they're more likely to build in the first place.
"Build to Rent developments offer an opportunity to increase the supply of secure, affordable and quality rental developments, placing downward pressure on rents."
