After tech billionaire PayPal founder and Facebook investor Peter Thiel and disgraced former NBC host Matt Lauer bought property, the New Zealand government is going to put an end to the trend.
The interest in buying property in New Zealand to ride out the apocalypse had such an allure to the mega-rich that it almost became a cliche.
LinkedIn co-founder Reid Hoffman told The New Yorker last year: “Saying you’re buying a house in New Zealand is kind of a wink, wink, say no more.”
The centre-left government led by Prime Minister Jacinda Arden blames the apocalypse preppers for the major housing crisis in the country, as reported in The Daily Telegraph.
The PM’s Labour party is insistent on trying to pass a law to ban foreigners from buying certain types of homes in order to help bring down property prices.
The party also plans on passing measures to build 100,000 affordable housing units in a decade.
These plans come as the country has some the highest rates of homelessness within the developed world.
Furthermore, these measures are expected to fix New Zealand’s zoning and infrastructure woes while boosting its declining construction industry.
The bill is expected to pass next week and it will allow foreigners to buy new apartments in large developments and multi-storey blocks, but existing homes will be off-limits.
People from Australia and Singapore will be exempt form the ban on the grounds of the existing free trade rules.
The Minister for Trade and Economic Development, David Parker, said it isn’t just about the housing prices.
Mr Parker told The Daily Telegraph: “In this world of concentrating wealth, we don’t want this coterie of ultra-wealthy people overseas being able to outbid successful New Zealanders for what is our birthright, not theirs.”
Economists and officials from the International Monetary Fund are questioning if foreigners are really buying properties at a rate that would spark a change in legislation.
Figures from June show just 3.3 percent of properties were bought by foreigners in the first three months of this year.
In Auckland, the country’s biggest city, the figures showed that foreign buyers made up 18.7 percent of purchases.
However, not everyone is convinced this is enough to drive down housing prices.
Shamubeel Eaqub, a housing economist with Auckland consultancy Sense Partners, said: “But house prices have increased everywhere.”
He agreed that the law would have some changes, “, “but it’s a question of whether you think it’s big enough to move the dial on house prices. I struggle with it.”