New Zealand has become the hot favourite for Chinese property buyers looking for overseas property. According to a Chinese real estate site, New Zealand is not only the second-cheapest country in the world for Chinese shoppers but also one of the most popular among the overseas destinations.

Singapore Expensive

The information from Juwai.com attests that the Chinese are looking for New Zealand real estate in the average price band of US$599,523, followed by moderately priced Australian properties. For Chinese, New Zealand ranks fifth out of a list of 10 countries they search for property. Among the overseas destinations, the United States is the most popular and Singapore is the most expensive.

Ranking in terms of average prices

· Singapore: US$3,726,625 (10th most popular)

· France: US$3,173,298 (7th most popular)

· Portugal: US$1,660,820 (6th most popular)

· United Kingdom: US$970,803 (4th most popular)

· Canada: US$912,579 (3rd most popular)

· Spain: US$827,577 (8th most popular)

· United States: US$725,510 (Most popular)

· Germany: US$638,750 (9th most popular)

· New Zealand: US$599,523 (5th most popular)

· Australia: US$546,705 (2nd most popular)

Stress On Auckland

As the demand from China is increasing, domestic concerns are also up. Andrew Bruce, president of the Auckland Property Investors' Association, said there should be closer scrutiny of overseas-based property buyers for mitigating the stress on Auckland housing market. Some of the policies that can curb foreign buyers include restricting purchases only in unbuilt building plans than existing houses; some level of mandatory re-investment in each foreign property acquisition into the New Zealand economy.

Red Hot

Interest of overseas investors in New Zealand property is still "red hot," affirmed Andrew Reed, international director of capital markets at Colliers International. He listed some key factors that are encouraging outbound investment from China in many places including New Zealand. They are,

• Chinese 'Go Abroad' policy

• China's insurance companies investing directly in overseas property

• Stricter domestic purchasing requirements

• Streamlining tax clearance procedures for corporate remittances

• Relaxing controls on corporate overseas price investment thresholds

Reed also predicted more Chinese investment in New Zealand commercial property, reports NZ Herald. He called 2014 as a defining moment in New Zealand's history in overseas property investment. This is because almost half the total value of properties sold for US$5 million or more in New Zealand has been to offshore investors, who constituted one fifth of all transactions. He illustrated the ongoing surge of Chinese interest in New Zealand by citing some key numbers. The Chinese people account for about 4 percent of New Zealand's population in which 69 percent live in Auckland, compared to just 3 percent in 2001.

(For feedback/comments, contact the writer at k.kumar@ibtimes.com.au)

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