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Property Council Applauds Legislative Changes To Boost Build To Rent Housing

Property Council New Zealand has expressed strong support for the government's Overseas Investment (Build to Rent and Similar Rental Developments) Amendment Bill, which aims to facilitate increased foreign investment in the Build-to-Rent housing sector.

The Amendment Bill proposes the introduction of a 'large rental development test' designed to attract much-needed overseas investment to stimulate the Build-to-Rent housing market in New Zealand.

"We are very pleased to see the government’s commitment to further unlocking Build to Rent housing in New Zealand," stated Leonie Freeman, chief executive of Property Council New Zealand. "The proposed legislative changes clearly signal that New Zealand is open to overseas investment in Build to Rent properties."

Freeman emphasised that the new legislation is expected to streamline the process for overseas investors, thereby boosting the supply of Build-to-Rent properties and providing essential housing for New Zealanders.

Research from Property Council New Zealand suggests that with supportive legislation, its developer members could construct 25,000 Build to Rent homes within the next decade.

In support of these initiatives, Property Council New Zealand has launched a dedicated website with partners Bayleys, Colliers, Savills, CBRE, and JLL, to monitor the growth of Build to Rent developments quarterly. As of May 14, 2024, the Build to Rent tracker reported 1,449 completed units, 822 units under construction, and 3,376 in the pipeline across 57 developments, primarily in Auckland. Further details are available at www.buildtorentnz.co.nz.

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"With these benchmarks in place, we look forward to observing the impact of today's announcement on the availability of Build to Rent homes once these changes are enacted," Freeman added.

Despite the legislation's reliance on Ministerial discretion for ensuring timely availability of at least 20 units per development for lease to occupiers, Freeman expressed optimism about continued government support for the Build to Rent sector.

"The Property Council is carefully reviewing the legislation and will collaborate with our members and the government to refine the Bill where appropriate, ensuring it effectively addresses housing supply challenges," said Freeman. "We are also exploring the potential benefits of introducing depreciation for Build to Rent fit-outs, which could significantly enhance the sustainability and suitability of housing for tenants."

Freeman concluded by commending the government's proactive collaboration with the industry. "It’s encouraging to see the government taking meaningful steps towards ensuring Aotearoa has more, better-quality housing, so all New Zealanders have a place to call home."

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