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Buying a Property in New Zealand

Investment potential

Capital growth in New Zealand has historically been good, with prices rocketing in the last five years. In fact, the July national house price median was over ten per cent higher than the median for the same period in 2005 – which was nine per cent higher than 2004’s figure. When you couple this with the favourable taxation system, then things for investors generally look pretty good. However, don’t buy in NZ purely because of the lack of capital gains tax – there are rumours that it could be introduced at any time.

There are plenty of property management firms available in the country – a necessity if you are planning on renting your property out from the UK. Landlords tend to offer unfurnished properties, and the occupancy rates are higher in the cities thanks to the high rates of migrants moving there.

However, due to the exchange rate, you may want to think twice before investing in New Zealand if you are planning on bringing your profit back to the UK. Financially, buying a kiwi home is far more lucrative if you are planning on staying in the country for the long term.

Health and education

Healthcare is of a good standard in New Zealand, and is generally funded through a public taxation system. Some treatments however, and even prescription medication, are only subsidised by the government. In fact, even a trip to your GP is likely to set you back $50 (£18), but on that basis you will usually get a same-day appointment. Ambulance services and visits to physiotherapists, chiropractors and osteopaths will also require you to provide a financial contribution. Private healthcare is available, and if you are not a permanent resident it is essential that you have health insurance.

If you are planning on taking your children to New Zealand, there is the usual choice of state-run and private schools. The education system has a good reputation, and schools are divided into primary, intermediate and secondary facilities. All children must attend full-time education from their sixth birthday to their sixteenth. International students must have a student permit to study in a Kiwi school for any period longer than three months.

Transport

The only way to navigate your way around New Zealand is to drive. Public transport in the cities is poor, and nationally it is pretty much non-existent. As a result traffic can be horrendous during peak hours in the urban areas, but if you are planning to travel from, say, Wellington to Auckland, be prepared to go an hour without seeing another vehicle. Be careful however, as the Desert Road that travels the length of the North Island can be treacherous due to poor driving conditions, and many fatalities occur here each year.

If you are crossing from the North to the South Island, or visa versa, a frequent ferry service is in operation – likewise if you are planning to visit Stewart Island. The smaller islands that surround New Zealand, such as in the Hauraki Gulf, are easily accessible via passenger ferry. Internal flights from Auckland are available to Wellington, Christchurch and Queenstown, but this can be an expensive option.

And finally…

While New Zealand offers fabulous scenery and a relaxed pace of life, it is a long way from home. Many people who move to this part of the world often feel cut off from friends and family and therefore find it quite hard to settle in. Also, one of the very things that may have attracted you to New Zealand, the exchange rate, could work against you should you decide to move back to the UK.

As with any overseas purchase, it is advisable to rent a property before you commit to buying your own. Never has this statement been truer than when considering a home in the New Zealand countryside. What seems like an idyllic move now could leave you feeling rather isolated. This really is a case of try before you buy.

Finally, think carefully about the location of New Zealand. While it offers a unique culture it is, at least, a three-hour flight away from its neighbours. So, if you are in the habit of popping over to Europe for weekend breaks, bear in mind that this will be a lifestyle no longer available to you.

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More pages

Page 1: Why New Zealand?
Page 2: Finance
Page 3: Investment potential

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