Seems as though prices are going back up again. With the recent release by LINZ that the majority of purchases are not from foreign buyers, it really puts a dent not only to the credibility of some parties (ahem Labour) but also raises the question… What really is driving Auckland’s housing “bubble”? Where is the money coming from?

Despite anecdotal evidence of foreigners buying up every property at every auction, the statistics show otherwise. Could there be other avenues to explain this? Possibly foreigners could be just incorporate companies and circumventing IRD number requirements that way. If not, we have to be wary at the types of restrictions the public is pressuring the government to implement – foreign purchasing restrictions, land tax and the already implemented IRD restriction is already signalling to the rest of the world that New Zealand is almost against foreign investment despite how ludicrous that sounds. Coupled with our large OIO rejections and now this scandal with Foreign trusts, it makes me wonder what’s going to be next and how attractive New Zealand will be in the eyes of foreign investment.

And YES we do need foreign investment. Our economy is quite reliant on it whether we like it or not. Unless we can suddenly generate intellectual property that vastly creates value on our primary production (see Comvita and Seadragon as huge proponents to this which is good) our country will not be wealthy and we will probably not survive. We need foreign expertise and investment in both financial capital and human capital.