Will the foreign ban help first home buyers?

The government has changed the rules on overseas buyers of property, with a view that the overseas purchasers are stopping NZers buying houses.

There may be some truth to this, but I don’t think its going to be a massive change. While it was hard to be 100% clear, the number of overseas buyers was not a huge percentage of the overall purchasers.

But its possible that they are also a lot of the bidders, driving up the price so even when they don’t win, they might drive up the price, locking out some NZers.

I don’t think this is going to change much, we may see a slight drop in some of the more crazy prices, but from talking with agents I know and the feedback from my clients who have missed out on houses, there is no feedback that its overseas people specifically, its just people prepared to pay more.

My advice to everyone worried about buying a home is to keep saving, and maximise your own ability to buy a home, and then be clear about your price range. Yes you may have to go through a few offers to get a house, but don’t hold out hoping that the government is somehow going to change the rules and prices will drop 100K or more and you will be able to get the house you have always wanted.

If the market goes down, supply will drop as well, as people wont sell at a loss unless they have to sell.

Focus to your own financial situation, maximise your deposit, and do what you can. If you are unsure what to do, get some advice.

Alan Borthwick