O'Rourke DenisDENIS O'ROURKE (NZ First): Overseas purchasers do have a big effect on the New Zealand housing market. The Government has never admitted that and in questions at question time over some years now this has been challenged. The Government has constantly said No they don't have much effect—no they don't have much effect." and has brought up spurious data to try to prove that. But the reality is that they do have a big effect. They have a big effect because they tend to buy land purely for capital-gain farming purposes only. They tend to land bank land they tend to speculate and they tend to buy homes and sit on them and not rent them out because that is an inconvenience. They are interested only in the capital gain. As I have said what they are really doing is just capital-gain farming. You can understand why—now that the average price of Auckland houses has reached a million dollars. When you look at the unbelievable capital gain that has occurred even over the last year you will see why the overseas purchasers with plenty of money are very keen on buying New Zealand homes. Therefore you see in various parts of the world advertisements—even by New Zealand real estate companies—encouraging overseas purchasers to buy in New Zealand. At various times New Zealand First has produced such advertisements sourced from China and sourced from Singapore. No doubt they occur in other places as well. Other nations have moved in the way that is proposed in this amendment proposed Part 5 and they have placed severe restrictions on overseas purchases of residential land either just through absolute prohibitions—which New Zealand First favours—or through the taxation system. This Government has done nothing. Why has it done nothing? Nobody really understands because overseas purchases for capital-gain farming purposes confer no benefit on New Zealand whatsoever and indeed they do significant damage. I want to move on to the particular provisions in this amendment which New Zealand First would like to be able to support. New section 17A inserted by proposed new clause 15 is the crux of them and they provide the criteria. Apart from good character and the ability to get a visa under normal rules the important part I think is section 17A(1)(c) which requires one of a number of criteria to be met. The first we agree with—that the person has to be a New Zealand citizen ordinarily resident in New Zealand or intending to reside here indefinitely. We agree with the second—that the relevant overseas person intends to reside in New Zealand temporarily but with an agreement to sell their New Zealand property if they then leave. That of course must be properly evidenced and guaranteed. The third one is the one that we disagree with. I have moved an amendment to proposed new Part 5 to remove section 17A(1)(c)(iii) which is the one that allows overseas investment if it is likely to increase the supply of New Zealand housing and consequentially I have moved the deletion of new section 17B as well. The reason for that is very simple. That is that we do not believe that it would be possible to properly police that subparagraph (iii) relating to the increase of supply of housing in New Zealand. How that could be properly evidenced? I know that there is section 17B there which tries to achieve that but I do not think it can. I think it makes the policy far too weak—there are too many let-offs in it. We could not support it. We just want a simple prohibition of purchasing residential land in New Zealand; we do not see any need for that exception. If my amendment is not passed we will be unable unfortunately to vote for this amendment inserting new Part 5 because it is such an important issue for us. We think that it is absolutely vital that overseas purchasers of residential land in New Zealand should be people who actually live here or who are citizens wherever they reside or people who want to come here and reside permanently in the country. We do not want any other let-out as far as overseas purchases are concerned. So we cannot support section 17A(1)(c)(iii) and we hope that the other parties in the Committee will look at my amendment and pass that to amend this amendment so that New Zealand First will be in a position to support it as well."