The law streamlines the consent process for overseas investors buying existing BTR developments
The government has passed the “Overseas Investment (Facilitating Build-to-Rent Developments) Amendment Bill,” introducing measures to encourage foreign investment in the build-to-rent (BTR) housing sector.
Associate Minister of Finance Chris Bishop announced the legislative change, highlighting its role in increasing the country’s housing supply.
The newly passed law establishes a streamlined consent process for overseas investors interested in acquiring existing BTR developments. According to Bishop, this amendment addresses a key concern for BTR developers—the ability to sell their assets. Since these large-scale rental developments require significant capital and expertise, developers have faced challenges finding domestic buyers upon exiting their investments.
BTR housing developments consist of medium-to-large-scale rental properties that are typically well-located near transport links. These professionally managed properties often include quality amenities and offer longer-term leases, making them an attractive option for renters. While BTR housing is a relatively new concept in New Zealand, it is a well-established model in other countries.
In a news release, Bishop emphasised that the previous restrictions under the Overseas Investment Act had discouraged foreign investment in BTR developments, slowing the sector's growth. He noted that few domestic investors have the necessary capital and experience to operate such large-scale rental properties. The new legislation allows overseas investors to apply for approval to purchase existing BTR developments containing at least 20 dwellings, provided they continue to lease them as rental properties.
The government aims to encourage further investment in the sector by providing certainty for developers regarding future asset sales. Bishop stated that the changes will increase the supply of secure, affordable, and high-quality rental housing, which could help stabilize or reduce rental prices.
The legislative amendment aligns with the government’s broader housing strategy, which focuses on improving housing availability and affordability for New Zealanders. With increased investment in BTR projects, officials anticipate a positive impact on the rental market, offering tenants greater access to stable and well-maintained housing.
