Accommodation in New Zealand
You may not want to jump straight into buying a house or finding a long-term rental when you arrive in New Zealand. The best option is to find some temporary accommodation, like a cheaper hotel/motel or Airbnb so you can get a feel for different neighborhoods and see where you would like to settle. Other great options are serviced apartments, hostels, or even renting out university accommodation throughout the summer.
Once you are a little more settled and have decided where you would like to live, then you will want to start looking into more long-term accommodation.
Types of accommodation in New Zealand
New Zealand is home to a range of accommodation types, some unique to the country:
- Villas - character-filled homes, usually built in the early 20th century. These are mainly found in city centers. They typically feature bay windows and higher ceilings but are also usually smaller in size - one or two bedrooms.
- Bungalows - Larger homes with all the living space on one level. Bungalows can have any number of bedrooms, from just two or even up to five. A lot of older homes will have wooden weatherboards; more modern versions will be brick. Bungalows are usually found in the suburbs or out of town.
- 1970's houses - Functional and boxy two-story houses without much character.
- Townhouses - Modern, semi-detached, or terraced houses, usually with two or three stories. They are usually built with weatherboards rather than wood or bricks. They usually have little to no garden or only small courtyards.
- Apartments - New apartments are always being built, with a large proportion in inner-city suburbs. Older commercial buildings are also being converted throughout cities as well.
- Tiny houses - These mobile options are becoming more popular all over the world, New Zealand included. Compact and able to be moved around, those with tiny houses often will rent a spot on some rural land rather than purchasing the land themselves.
Renting accommodation in New Zealand
When looking for apartments to rent in New Zealand, your best options are TradeMe as well as real estate agencies and local newspapers. Rent is paid per week in New Zealand, which is why it may initially seem cheaper than overseas.
Rental prices in New Zealand's major cities can vary significantly depending on the location, size, and condition of the property. In general, rental prices tend to be higher in larger cities, particularly in Auckland and Wellington.
According to recent data from the Ministry of Business, Innovation and Employment (MBIE), the median weekly rent for a one-bedroom flat in Auckland is NZ$450, while the median weekly rent for a three-bedroom house is NZ$680. In Wellington, the median weekly rent for a one-bedroom flat is NZ$440, while the median weekly rent for a three-bedroom house is NZ$660.
In Christchurch, the second-largest city in New Zealand, the median weekly rent for a one-bedroom flat is NZ$420, while the median weekly rent for a three-bedroom house is NZ$640. In Hamilton, the fourth-largest city, the median weekly rent for a one-bedroom flat is NZ$380, while the median weekly rent for a three-bedroom house is NZ$590.
On choosing to rent accommodation in New Zealand, you will need to pay a bond when moving in. This can be up to four weeks' rent and is kept for you by the government (Ministry of Business, Innovation and Employment). This payment is returned to you when you move out as long as the house is kept in good condition. You are also responsible for paying utilities, like electricity, water, gas and internet. Your landlord will pay for building insurance and the local council taxes (rates).
There is a minimum notice period for ending any contract, usually 21 days when the tenant gives notice or three months if the landlord gives notice. You will need to check the contract to see whether there are any specific terms and conditions.
Flatsharing in New Zealand
If you are moving to New Zealand alone, flatting may be a better option than renting out a whole house on your own. This can be not only a more affordable option but also a great way to make new friends.
In New Zealand, shared housing is common among students and young professionals. Due to rising housing costs, flatting is also becoming more common later in life as it is usually far more affordable than renting a standalone house.
In a flat, tenants usually have their own bedroom but share common areas such as the kitchen, living room, and bathroom with other tenants. Flats can range in size from small studios to larger multi-bedroom units.
The process for finding and renting a flat in New Zealand is similar to that in other countries. You can search online for listings, ask friends or colleagues for recommendations, or work with a real estate agent to find a suitable flat.
It's important to carefully read and understand the terms of the tenancy agreement before signing it, as it will outline the rights and responsibilities of both the landlord and the tenant. In New Zealand, the Residential Tenancies Act sets out the legal rights and obligations of landlords and tenants and provides a framework for resolving any disputes that may arise during the tenancy.
The property market in New Zealand
The property market in New Zealand has experienced strong demand in recent years, driven by factors such as population growth, low interest rates, and a shortage of housing in some areas. As a result, property prices rose steadily, particularly in the larger cities.
According to data from the Real Estate Institute of New Zealand (REINZ), the median sale price of a house in New Zealand reached a record high of NZ$735,000 in December 2021, an increase of over 15% from the previous year. In Auckland, the median sale price of a house reached NZ$1,100,000, while in Wellington, it was NZ$905,000.
However, the market has also been impacted by factors such as the COVID-19 pandemic and restrictions on foreign buyers, and in 2022, New Zealand's house prices finally began to drop. The Reserve Bank predicts up to a 15% drop in house prices before they begin to recover at the end of 2023.
The property market in New Zealand can be complex, and it's important for buyers to do their research and seek advice from professionals such as real estate agents and lawyers before making a purchase. It's also worth noting that the market can vary significantly depending on the location, with prices and demand differing between cities and regions.
Buying property in New Zealand
Depending on how long you are planning on staying in New Zealand, buying a property may be a great option. To do this, you will likely need to contact a bank to be able to take out a mortgage. It can be difficult for immigrants to qualify for loans, but if you have plenty of documentation from home, including proof of your financial means, assets to use as collateral, and the money for a deposit, it is possible. There are different types of loans available. Your mortgage advisor will go over all the options and help you decide what is best for you.
Housing prices in New Zealand are high – although they have experienced a dip in 2022. Apartments and townhouses tend to be cheaper alternatives, with detached houses and bungalows costing a lot more. Suburbs tend to be more affordable, with city centers being quite expensive. Housing prices can be determined in different ways, including:
- Asking price - the vendors will want offers over the price listed. This gives a good indication of the market value
- RV - rateable value - the value that's determined by the council so that they can charge the correct rates. You can pay for a valuation report yourself or search for a free service online.
If you're new to buying a house in New Zealand, it's recommended that you get involved with a lawyer quickly just to have all the jargon and procedures explained. You should also have the house inspected so you can find out about any structural problems before you buy the house. You are also advised to inquire about any earthquake protections that the house may have. If you are seriously considering purchasing property in New Zealand, here are some tips to get you started:
- Research the market: It's important to understand the local real estate market, including average prices and trends, before you start looking for a property. You can research online or talk to a real estate agent to get an idea of what to expect.
- Get pre-approved for a mortgage: It's a good idea to get pre-approved for a mortgage before you start looking for a property. This will give you a good idea of how much you can afford and can make the process of buying a property smoother.
- Work with a real estate agent: A real estate agent can help you navigate the process of buying a property and can assist you in finding a property that meets your needs and budget.
- Consider the location: Consider the location of the property carefully. Think about factors such as proximity to work, schools, and amenities.
- Get a home inspection: It's important to have a home inspection before you finalize the purchase of a property. This will help you identify any potential issues with the property and allow you to negotiate any necessary repairs or credits.
- Understand the tax implications: Make sure you understand the tax implications of purchasing a property in New Zealand. This includes things like stamp duty, which is a tax on the transfer of property.
Purchasing property as a foreigner in New Zealand
There are no restrictions on foreigners buying property in New Zealand. However, there are some additional steps that foreign buyers may need to take in order to purchase property in the country.
Foreign buyers are required to obtain approval from the Overseas Investment Office (OIO) before purchasing certain types of property in New Zealand. This includes:
- Agricultural land of more than five hectares
- Sensitive lands, such as conservation land or land in certain protected areas
- Business assets, such as businesses that are considered sensitive, such as fishing quotas
To obtain approval from the OIO, foreign buyers must show that the investment will be of benefit to New Zealand and that they are of good character.
In addition to the OIO approval process, foreign buyers must also comply with New Zealand's anti-money laundering and counter-terrorism financing laws. This includes providing proof of identity and the source of funds used to purchase the property.
Overall, while there are no restrictions on foreigners buying property in New Zealand, there are some additional requirements that must be met in order to complete the purchase.
