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|Updated: 31 May 2017|
|Legal/Para Legal Services||Yes|
|Updated: 15 Jun 2017|
|Corcoran French is a firm of Christchurch and North Canterbury lawyers with over 120 years experience in providing legal services to Christchurch and the wider Canterbury region. We have offices in Christchurch City and Kaiapoi. We can also meet you at shared offices at Akaroa.
The Corcoran French team comprises five partners and more than 40 lawyers and support staff who are committed to providing high quality, cost-effective legal services.
We welcome new clients and are committed to building strong long-term relationships that are rewarding for our clients. We guarantee to provide you with effective solutions - peace of mind.
|Updated: 30 Nov 2018|
Changes affecting every buyer of residential land
Overseas Investment Amendment Act 2018 now in force
We covered the Overseas Investment Amendment Bill in Property Speaking’s Spring 2018 edition. The Bill has become law and is now the Overseas Investment Amendment Act 2018 (the OIA Act). It has been in force since 22 October.
The implication for you is that when you next buy residential property, there will be another layer of compliance to be completed before your property purchase goes through.
The OIA Act’s primary purpose is to amend the definition of sensitive land to include ‘residential land’. This means that people who are not New Zealand citizens, or who do not hold New Zealand, Australian or Singaporean residence class visas AND are not ordinarily resident in New Zealand must apply for consent to buy residential land in New Zealand. The underlying reason for this beefed-up legislation is to restrict foreign ownership of New Zealand land, and to encourage foreign owners to live in their properties rather than become landlords.
Defining residential land
The OIA Act defines residential land as a property that has a category of residential ‘R’ or lifestyle ‘L’ for the purpose of the relevant district valuation roll. It also includes a residential flat in a building owned by a flat-owning company regardless of whether the building is on land categorised as ‘R’ or ‘L’.
Both buyers and sellers should be aware that even if the property in question is a large farm (which is already subject to OIA rules) the new rules may class that property as residential land also and a prospective purchaser must meet the eligibility test to buy residential land in New Zealand.
To determine if the land you intend buying (or selling) is residential or lifestyle, the Overseas Investment Office recommends you check the Quotable Value website here. Enter the address into the search box to establish the property’s building type.
Who is eligible to buy residential land?
Generally speaking, foreigners who are in New Zealand on a work, student or temporary visa are unable to buy residential land in New Zealand. This also includes trusts or companies that have 25% or more overseas ownership (beneficiaries and shareholders) or control (trustees and directors). However, exceptions do apply. These include:
These are likely to be the most common exceptions but there are others that may be available to you, we won’t know until we sit down together and look at your situation.
All purchasers of residential land who are not New Zealand, Australian or Singaporean citizens will need to be ordinarily resident in New Zealand. You will be ordinarily resident if:
What does this mean for you?
For all residential land purchases where the agreement for sale and purchase was signed after 22 October 2018 you will be required to sign a statement that you are eligible to purchase residential land in New Zealand. We are then required to hold that statement for seven years after the purchase is settled.
If you do not sign the statement, then we will not be able to complete the purchase for you. Likewise, if we have cause to believe that the information provided may be incorrect, we will need to investigate. To take this additional compliance into account, we recommend that in most cases a minimum 15 working days condition be included on agreements for residential property to allow the appropriate investigations to take place and for consent to be applied for if necessary.
Some useful information, checklists and the statement are available on the LINZ website here.