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How much of a difference will the foreign house buyers ban make?

How much of a difference will the foreign house buyers ban make?

Ardern told reporters that legislation would be introduced in parliament by December 25.

"We must find a solution to allow us to ban overseas buyers of existing New Zealand homes for us to proceed with TPP11", the newspaper quoted Parker as saying. In Auckland, the country's most populous city, prices have almost doubled in that same period, according to Reuters.

National Finance spokesman Steven Joyce said the change wouldn't make any difference in terms of house prices and supply.

Under the proposed housing legislation, Australians and foreigners who are New Zealand citizens or residents would be exempt. "Kiwis should not be outbid like this". Auckland is the fourth-least affordable property market in the world, according to Demographia.

While New Zealand joins other countries in restricting sales of existing homes to foreigners, such measures have done little to curb prices in places like Hong Kong and neighboring Australia.

The ban is created to overcome a politically sensitive housing crunch that has priced many New Zealanders out of the market, with prices up more than 50 percent nationally in the last decade. Consequently, house prices have risen by 50 percent in the past decade while home-ownership has dropped to its lowest level in 65 years.

On Tuesday, the Labour-led Government announced it would end foreign buying of existing houses by classifying them all as "sensitive" under the Overseas Investment Act.

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That was what the previous Government did with Australia: a side letter between the two countries, signed at the same time as the main TPP deal, agreed that investors from either Australia or New Zealand would not be able to use the ISDS against their respective countries.

The new rules on foreign purchases won't apply to land, or to properties that haven't been built yet.

Parker admitted it was impossible for the Government to know exactly how big the impact of the ban would be due to a lack of clear data around foreign buyers. The domestic law change on foreigners buying homes provides Ms Ardern with a work-around.

If the ban wasn't done now, "you can never do it", he said, referring to the need to get the change through before the Trans-Pacific Partnership (TPP) trade deal came into effect.

"Prime Minister Ardern and I will discuss how we can further our trade and economic opportunities and promote jobs and skills development in both countries", he said.

The legislation is expected to be introduced by Christmas and passed in the new year.