Overseas Investment Act 2005

Schedule 2: Sensitive land that is residential land

You could also call this:

"Rules for overseas buyers of homes and land in New Zealand"

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The Overseas Investment Act 2005 has rules about sensitive land that is residential land. You need to know what these rules are if you want to invest in residential land in New Zealand.

The rules are set out in a schedule that explains what tests need to be met for an overseas investment in residential land to be approved. There are different tests, such as the commitment to reside in New Zealand test, the increased housing test, and the non-residential use test.

Each test has its own conditions that need to be met. For example, the commitment to reside in New Zealand test requires that the person investing in the land intends to live in New Zealand for at least 183 days per year. The increased housing test requires that the investment will result in an increase in the number of residential dwellings on the land.

If an overseas investment in residential land is approved, conditions may be imposed on the consent. These conditions can include requirements such as disposing of the land if certain events occur, or not occupying the land for residential purposes.

There are also exemptions from some of these conditions in certain circumstances. For example, if the investment is in a large development with shared equity, rent-to-buy, or rental arrangements, the condition requiring the on-sale outcome may not be imposed.

You can find more information about these rules and tests in the Overseas Investment Act 2005 and its schedules. You can also look at the links to other parts of the legislation, such as section 16, section 16B, and section 61, for more details.

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This page was last updated on 10 September 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS112371.

Topics:

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Schedule 1A: Total term of interest in land, or

"How long you can own or control a piece of land"

Schedule 3: Exemptions from requirement for consent, or

"When You Don't Need Permission to Buy Land in New Zealand"

2Sensitive land that is residential land Empowered by ss 6, 16, 16B, 61

1Outline and definitions

1Outline of this schedule

In this schedule,—
Part 2 sets out the commitment to reside in New Zealand test, which is a test that is only available for residential land:
Part 3 sets out the increased housing test, the large rental development test, the non-residential use test, and the incidental residential use test, which are tests that are only available for overseas investments in sensitive land where the relevant land is residential (but not otherwise sensitive) land:
Part 4 explains how more than 1 test can be met for the purpose of section 16(1)(b)(i):
Parts 2 and 5 set out conditions that this Act requires be imposed on consents that are granted for certain overseas investments in sensitive land where the relevant land is or includes residential land.

This clause is only a guide to the general scheme and effect of this schedule.

Notes

Schedule 2 clause 1(1)(b): amended, on 25 February 2025, by section 6(1) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

2Interpretation

In this schedule,—
key individual, in relation to an overseas investment, has the meaning set out in clause 4
qualifying individual has the meaning set out in clause 4
relationship property means relationship property as defined in section 8 of the Property (Relationships) Act 1976
relevant business has the meaning set out in clause 12(2) and (3)
relevant interest, in relation to residential land, means—
1. the estate or interest in the residential land; or
2. rights or interests in securities of a person who owns or controls (directly or indirectly) any estate or interest in the residential land
resolved, in relation to a trigger event, has the meaning set out in clause 7
specified period means the period or periods (or a means of calculating a period or periods) to be specified in the consent for the matter concerned
spouse or partner means spouse, civil union partner, or de facto partner
trigger event is defined in clause 7.

Notes

Schedule 2 clause 2 relevant interest paragraph (a): amended, on 16 June 2020, by section 55(1) of the Overseas Investment (Urgent Measures) Amendment Act 2020 (2020 No 21).
Schedule 2 clause 2 relevant interest paragraph (b): amended, on 16 June 2020, by section 55(1) of the Overseas Investment (Urgent Measures) Amendment Act 2020 (2020 No 21).

2Commitment to reside in New Zealand test

Availability of test

3For what land is test in this Part available

The commitment to reside in New Zealand test is only available for residential land.
It does not matter if the residential land is also sensitive for some other reason under Part 1 of Schedule 1.

4Who are qualifying individuals and key individuals

This clause defines certain terms for the purposes of an overseas investment in sensitive land that is considered under the commitment to reside in New Zealand test.
A person is a qualifying individual if the person—
is a New Zealand citizen; or
is ordinarily resident in New Zealand; or
is an overseas person who holds a residence class visa granted under the Immigration Act 2009; or
is an overseas person of a type that is specified in regulations made under section 61(1)(j).

The key individuals for the overseas investment are—
the relevant overseas person (if an individual); or
if the relevant overseas person is not an individual, every individual with control of the relevant overseas person (unless the individual is exempt under clause 9).

However, if—
2 individuals (A and B) who would be key individuals under subclause (3) are the spouse or partner of each other; and
either—
1. the relevant interest in the residential land will be acquired as relationship property of A and B and regulations exempt B from the requirement for consent under section 10(1)(a); or
2. the interest in the residential land will be acquired by a company that is incorporated in New Zealand and in which all of the securities are wholly owned as relationship property by A and B, on the basis that A is a key individual,—

then B is not a key individual for the overseas investment.

B (but not A) can also be disregarded for the overseas investment when determining whether the investor test is met if—
the application for consent is under the commitment to reside in New Zealand test only; and
the investor test applies (because the relevant land is or includes residential land and land that is sensitive under Part 1 of Schedule 1 for some other reason); and
the relevant Ministers are satisfied that A is an individual with control of the relevant overseas person (for example, if the relevant overseas person is a company).

Test and conditions

5How commitment to reside in New Zealand test is met

The commitment to reside in New Zealand test is met if all of the following are met:
the relevant Ministers are satisfied that—
1. every key individual is a qualifying individual; and
2. the purpose of acquiring the relevant interest in the residential land is the acquisition of 1 dwelling (whether that dwelling is constructed on, or is being or will be constructed on, the residential land) for all of the key individuals to occupy as their main home or residence; and
every key individual who is an overseas person (an OP) (if any) provides a statutory declaration that the OP intends,—
1. at least until the declaration end date, to be present in New Zealand for at least 183 days in every 12-month period beginning on the date of consent or its anniversary in any year; and
2. (if not already tax resident in New Zealand) to become tax resident in New Zealand; and
3. to remain tax resident in New Zealand at least until the declaration end date.

See also clause 6 (which sets out certain conditions to be imposed on certain consents that rely on meeting this test, including a requirement for the consent holder to dispose of all relevant interests in the residential land in certain circumstances).
In this clause,—
declaration end date, in relation to an OP, means the earlier of—
1. the date that the OP becomes a New Zealand citizen or ordinarily resident in New Zealand; or
2. the date that the relevant overseas person ceases to have a relevant interest in the residential land
dwelling means a residential dwelling or a dwelling in a long-term accommodation facility
tax resident in New Zealand means a person who is a New Zealand resident under section YD 1 of the Income Tax Act 2007.

6Conditions for consent if commitment to reside in New Zealand test is met

This clause applies if consent is to be granted for an overseas investment on the basis of the commitment to reside in New Zealand test and 1 or more key individuals are overseas persons.
Conditions must be imposed on the consent for the purpose of requiring the matters in the first column of the following table.

Conditions so imposed cease to have effect as set out in the second column of the following table.

The following table is small in size and has 3 columns. Column 1 has no heading. Column 2 is headed If 1 or more key individuals are overseas persons, conditions that require the following matters must be imposed on the consent Column 3 is headed ... to have effect until
		If 1 or more key individuals are overseas persons, conditions that require the following matters must be imposed on the consent		... to have effect until
1		All key individuals must occupy the dwelling as their main home or residence (the occupation requirement)		Every key individual who was an overseas person has become a New Zealand citizen or ordinarily resident in New Zealand
2		The consent holder must dispose of all relevant interests that the consent holder has in the residential land within 12 months of the date that a trigger event occurs (unless the trigger event is resolved within those 12 months) (the disposal requirement)		The trigger event regime ceases for the overseas investment (see clause 7)

See also sections 25A and 25B (in relation to the imposition of conditions generally).

Trigger events

7What are trigger events and how they are resolved

Trigger events only occur for an overseas investment in relation to key individuals who are overseas persons (each, an OP) at the date of consent.
In the following table,—
the first column defines each trigger event in relation to an OP; and
the second column alongside sets out how the trigger event is resolved.

The following table is small in size and has 3 columns. Column 1 has no heading. Column 2 is headed Trigger event and column 3 is headed How trigger event is resolved.
	Trigger event	How trigger event is resolved
1	On an anniversary date, OP has been absent from New Zealand for more than 183 days in total in the immediately preceding 12 months without a waiver	OP is present in New Zealand for at least 183 days in total in the 12-month period beginning on the anniversary date; or A waiver is applied for and granted (see clause 8); or A prescribed resolution applies; or The trigger event regime ceases for OP (see subclause (3))
2	OP ceases to hold a residence class visa granted under the Immigration Act 2009	OP becomes the holder of a residence class visa granted under the Immigration Act 2009; or OP becomes a person of a type that is specified in regulations made under section 61(1)(j); or A prescribed resolution applies; or The trigger event regime ceases for OP (see subclause (3))
3	OP ceases to be a person of a type that is specified in regulations made under section 61(1)(j)	OP becomes a person of a type that is specified in regulations made under section 61(1)(j); or OP becomes the holder of a residence class visa granted under the Immigration Act 2009; or A prescribed resolution applies; or The trigger event regime ceases for OP (see subclause (3))

No further trigger events can occur for an OP—
who becomes a New Zealand citizen or ordinarily resident in New Zealand; or
whose spouse or partner becomes a New Zealand citizen or ordinarily resident in New Zealand, but only if clause 4(4)(b) applies.

Subclause (3) applies regardless of whether the OP (or the OP’s spouse or partner, as relevant) again becomes an overseas person.
The trigger event regime ceases for the overseas investment when no further trigger events can occur in relation to any key individuals.
For the purposes of this clause, a person who is present in New Zealand for part of a day is treated as present in New Zealand for a whole day.
In this clause,—
anniversary date means the anniversary of the date of consent in any year
prescribed means prescribed by regulations made under section 61(1)(ja)(ii).

8Waiver relating to trigger event

An application may be made, in respect of a person (an OP) in relation to whom a trigger event under item 1 of the table in clause 7(2) may or will occur, or has occurred, for a waiver from the requirement for the consent holder to dispose of all relevant interests in the residential land as a consequence of the trigger event occurring.
The relevant Ministers must grant the waiver if the relevant Ministers consider, in accordance with regulations made under section 61(1)(ja)(i), that the OP remains committed to residing in New Zealand.
A waiver—
may be general or may specify the 1 or more instances of the trigger event to which it applies:
may be open-ended or granted for a period:
may be made subject to any conditions.

A waiver may at any time be amended or revoked in the same way as it may be made.

Exemption

9Exemption from definition of key individual

If, for an overseas investment in sensitive land being considered under the commitment to reside in New Zealand test, the relevant overseas person is not an individual, the relevant Ministers may determine that 1 or more of the individuals with control of the relevant overseas person is not a key individual for the overseas investment—
because of the circumstances relating to the particular relevant overseas person and the purpose of the overseas investment; and
only if the relevant Ministers are satisfied of both of the following:
1. that the individual will not have any beneficial interest in, or beneficial entitlement to, the relevant interest in the residential land; and
2. if the relevant overseas person is a trust, that the individual is not a person who may (directly or indirectly) benefit under the trust at the discretion of the trustees and is not likely to become such a person.

3Increased housing, large rental development, non-residential use, and incidental residential use tests

Availability of tests

10For what land are tests in this Part available

The 4 tests in this Part are only available if the relevant land is residential (but not otherwise sensitive) land.

Notes

Schedule 2 clause 10: amended, on 25 February 2025, by section 6(3) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

Increased housing test

11How increased housing test is met

The increased housing test is met if the relevant Ministers are satisfied that—
1 or more of the following outcomes (the increased housing outcomes) will, or are likely to, occur on the residential land:
1. an increase in the number of residential dwellings constructed on the residential land (including an increase from 0):
2. construction of a long-term accommodation facility on the residential land, or an increase in the number of dwellings in a long-term accommodation facility that is on the residential land:
3. development works on the land to support the doing of things described in either or both of subparagraphs (i) and (ii); and
the following outcomes (as defined in clause 17) will, or are likely to, occur:
1. the on-sale outcome (unless exempt from this outcome under subclause (2)); and
2. the non-occupation outcome.

Subclause (1)(b)(i) does not apply,—
if the increased housing outcome is as described in subclause (1)(a)(ii) and the relevant Ministers are satisfied that the long-term accommodation facility will, or is likely to, operate from the residential land within a specified period, to the extent that the relevant Ministers are satisfied that the land will, or is likely to, be used for those operations; or
if an exemption under clause 20 (exemption for large developments with shared equity, rent-to-buy, and rental arrangements) applies.

The increased housing outcomes are measured by comparing the expected result of the overseas investment against the state of the residential land before the transaction takes effect.
In this clause (and in clause 19), development works—
includes the construction, alteration, demolition, or removal of a building or infrastructure; and
includes siteworks (including earthworks) that are preparatory to, or associated with, the matters set out in paragraph (a); but
does not include subdivision of land without other development works.

See also clause 18 (which sets out certain conditions to be imposed on consents that rely on meeting this test).

Large rental development test

11AHow large rental development test is met

The large rental development test is met if the relevant Ministers are satisfied that—
the residential land is a single site, or adjacent sites separated by infrastructure (such as roads), with 1 or more buildings that, taken together, consist of 20 or more dwellings suitable for use as, or conversion to, residential dwellings; and
at least 20 of the residential dwellings will be, or are likely to be, available for use, within a time frame that is satisfactory to the relevant Ministers, as a residential dwelling occupied under a residential tenancy to which the Residential Tenancies Act 1986 applies or would apply (the large rental development outcome); and
the non-occupation outcome (as defined in clause 17) will, or is likely to, occur.

See also clause 18 (which sets out certain conditions to be imposed on consents that rely on meeting this test).

Notes

Schedule 2 clause 11A: inserted, on 25 February 2025, by section 6(4) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

Non-residential use test and incidental residential use test

12What is the relevant business

This clause applies if an overseas investment is being considered under the non-residential use test or the incidental residential use test.
The relevant Ministers may determine which 1 or more of the following is the relevant business:
a business of the relevant overseas person (A):
a business of a person (B) if A owns or controls the relevant interest in the residential land primarily for B to use the residential land in that business:
a business of a person (C) if C owns or controls the relevant interest in the residential land and A has rights or interests in securities of C.

However, in making that determination, the relevant Ministers must be satisfied that the business is likely to continue for a reasonable period of time, given the circumstances and nature of the business.

Notes

Schedule 2 clause 12(2)(c): inserted, on 5 July 2021, by section 34(1) of the Overseas Investment Amendment Act 2021 (2021 No 17).

13How non-residential use test is met

The non-residential use test is met if the relevant Ministers are satisfied that the residential land will be, or is likely to be (or will, or is likely to, continue to be)—
used for non-residential purposes in the ordinary course of business for the relevant business; and
not used, nor held for future use, for any residential purposes.

In any case where the relevant Ministers are not satisfied that the matters in subclause (1)(a) and (b) (the non-residential use outcome) will, or are likely to, occur within a short period after the overseas investment is given effect under the transaction, they may determine that the non-residential use test is met if—
either—
1. the relevant Ministers are satisfied that the non-occupation outcome (as defined in clause 17) will, or is likely to, occur; or
2. the incidental residential use test is applied for and met in respect of the residential land; and
the relevant Ministers are satisfied that, within a specified period, the non-residential use outcome will be, or is likely to be, met.

Subclause (4) applies if the relevant Ministers determine that the non-residential use test is met only in respect of part of the residential land and no other test is applied for and met in respect of the remaining part of the residential land.
The relevant Ministers may determine that the non-residential use test is met if they are satisfied that the on-sale outcome (as defined in clause 17) will, or is likely to, occur for the remaining part of the residential land.
See also clause 18 (which sets out certain conditions to be imposed on consents that rely on meeting this test).

14How incidental residential use test is met

The incidental residential use test is met if the relevant Ministers are satisfied that—
the residential land will be, or is likely to be (or will, or is likely to, continue to be) used for residential purposes but only in support of the relevant business, where the relevant business is not (or is only exceptionally) in the business of using land for residential purposes (the incidental residential use outcome); and
having regard to that use of the residential land, the relevant interest in the residential land will be, or is likely to be, acquired in the ordinary course of the business of the relevant overseas person.

In considering whether the incidental residential use test is met, the relevant Ministers may have regard to all or any of the following:
whether any reasonable alternative exists to the acquisition of the relevant interest in the residential land:
the proximity of the residential land to the premises or operations of the relevant business:
whether the use of the residential land for residential purposes is (without limitation) as accommodation for staff engaged in the relevant business:
any other factors that seem to the relevant Ministers to be relevant in the circumstances.

Subclause (4) applies if the relevant Ministers determine that the incidental residential use test is met only in respect of part of the residential land and no other test is applied for and met in respect of the remaining part of the residential land.
The relevant Ministers may determine that the incidental residential use test is met if they are satisfied that the on-sale outcome (as defined in clause 17) will, or is likely to, occur for the remaining part of the residential land.
See also clause 18 (which sets out certain conditions to be imposed on consents that rely on meeting this test).

4How transaction meets more than 1 test in this schedule

15How transaction meets more than 1 test in this schedule

For the purposes of section 16(1)(b)(i), different tests in this schedule can be met in respect of different parts of the residential land that is, or is included in, the relevant land so long as at least 1 test is met in respect of each part of the residential land.

5Conditions attached to outcomes for residential land

Conditions

16Conditions attached to outcomes for residential land

This Part sets out conditions to be imposed on consents that are granted for overseas investments in sensitive land on the basis that—
1 or more of the tests in Part 3 are met; or
the benefit to New Zealand test is met, the relevant land is or includes residential land, and section 16B applies.

See also—
clause 6 (for conditions to be imposed on certain consents that are granted on the basis that the commitment to reside in New Zealand test is met):
sections 25A and 25B in relation to the imposition of conditions generally.

17What are on-sale outcome and non-occupation outcome

This clause defines the on-sale outcome and the non-occupation outcome for the purposes of various conditions and related tests.
The on-sale outcome is that, within a specified period, the relevant overseas person disposes of all relevant interests in the residential land.
The non-occupation outcome is that, for so long as the relevant overseas person has a relevant interest in the residential land, none of the following occupy the land for residential purposes:
the relevant overseas person (A):
any overseas person (B) who has a more than 25% ownership or control interest in A:
any overseas person (C) who occupies the land otherwise than on arm’s-length terms (for example, a relative who occupies rent-free), where arm’s-length terms means terms that—
1. would be reasonable in the circumstances if the owner of the land (including their property agent) and C (including their associates) were connected or related only by the transaction in question, each acting independently, and each acting in its own best interests; or
2. are less favourable to C than the terms referred to in subparagraph (i):
any overseas person who has a beneficial interest in, or beneficial entitlement to, the relevant interest in the residential land:
if A is a trust, a person who may (directly or indirectly) benefit under the trust at the discretion of the trustees.

However, subclause (3)(c) to (e) do not apply to a person who is entitled to occupy the land under any consent or any exemption in this Act or the regulations (for example, a person who has consent on the basis of the commitment to reside in New Zealand test may be entitled to lease a new dwelling in respect of which the developer is subject to a non-occupation outcome under the increased housing test).
For the purposes of section 16A(2)(c) and (4)(c), subclause (3)(c) does not apply to the extent that—
accommodation is being provided for the purpose only of supporting forestry activities (as defined in section 16A(9)) being carried out on the farm land (in the case of section 16A(2)(c)) or the relevant land (in the case of section 16A(4)(c)); and
all the buildings being used for that accommodation are located on land on which some or all of those forestry activities are being carried out or on land that adjoins land on which some or all of those forestry activities are being carried out.

Notes

Schedule 2 clause 17(3): amended, on 5 July 2021, by section 34(2) of the Overseas Investment Amendment Act 2021 (2021 No 17).
Schedule 2 clause 17(3)(b): amended, on 16 June 2020, by section 55(2) of the Overseas Investment (Urgent Measures) Amendment Act 2020 (2020 No 21).
Schedule 2 clause 17(5): inserted, on 16 August 2022, by section 9 of the Overseas Investment (Forestry) Amendment Act 2022 (2022 No 42).

18Conditions for consent if 1 or more tests in Part 3 are met

This clause applies if consent is to be granted for an overseas investment on the basis that 1 or more of the tests in Part 3 are met.
For each test (as set out in the first column of the following table) that is met,—
the second column sets out the conditions that must be imposed on the consent in relation to the residential land in respect of which the test is met; but
if any circumstances set out in the third column relating to a condition apply, the condition need not be imposed.

The following table is small in size and has 3 columns. Column 1 is headed If consent is granted on the basis of the following test Column 2 is headed ... conditions that require the following must be imposed on the consent in relation to the residential land Column 3 is headed ... except in the following circumstances
	If consent is granted on the basis of the following test		... conditions that require the following must be imposed on the consent in relation to the residential land
1	Increased housing test		1 or more increased housing outcomes (as defined in clause 11)
		The on-sale outcome (as defined in clause 17)		Clause 11(2)(a) applies (which relates to the operation of a long-term accommodation facility) to the extent that that clause applies
			Or an exemption under clause 20 applies (which relates to large developments with shared equity, rent-to-buy, and rental arrangements) (but see clause 20(3))
		The non-occupation outcome (as defined in clause 17)
1A	Large rental development test		The large rental development outcome (as defined in clause 11A(1)(b)) The on-sale outcome (as defined in clause 17), if clause 11A(1)(b) ceases to be met The non-occupation outcome (as defined in clause 17)
2	Non-residential use test		The non-residential use outcome (as defined in clause 13)
	If clause 13(2) applies, the non-occupation outcome (as defined in clause 17)		The incidental residential use test is applied for and met
	If clause 13(4) applies, the on-sale outcome (as defined in clause 17) (but only in relation to the remaining part of the residential land)
3	Incidental residential use test		The incidental residential use outcome (as defined in clause 14)
If clause 14(4) applies, the on-sale outcome (as defined in clause 17) (but only in relation to the remaining part of the residential land)

Notes

Schedule 2 clause 18(2)(b) item 1A: inserted, on 25 February 2025, by section 6(5) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

19Conditions for consent if benefit to New Zealand test is met and residential land is involved

This clause applies for the purposes of section 16B and the grant of a consent for an overseas investment on the basis that the benefit to New Zealand test is met and the relevant land is or includes residential land.
In the following table,—
the first column lists a residential land outcome; and
the second column describes the set of conditions for the residential land outcome; and
the third column describes the circumstances (if any) when an exemption may apply.

The following table is small in size and 4 columns. Column 1 has no heading. Column 2 is headed If residential land outcome is Column 3 is headed ... conditions that require the following must be imposed on the consent in relation to the residential land Column 4 is headed ... except in the following circumstances
	If residential land outcome is		... conditions that require the following must be imposed on the consent in relation to the residential land		... except in the following circumstances
1	On-sale		The on-sale outcome (as defined in clause 17)
2	Use for non-residential purposes		The residential land is not used, nor held for future use, for residential dwellings or long-term accommodation facilities
3	Operation of a long-term accommodation facility on the residential land (whether the facility is existing or is being or proposed to be constructed)		Operation of the long-term accommodation facility
The non-occupation outcome (as defined in clause 17)
4	Increased residential dwellings		Either or both of the following: an increase in the number of residential dwellings constructed on the residential land (including an increase from 0): development works on the land to support the doing of things described in paragraph (a)
		The on-sale outcome (as defined in clause 17)		An exemption under clause 20 (which relates to large developments with shared equity, rent-to-buy, and rental arrangements) applies (but see clause 20(3))
			Or an exemption under clause 21 (which relates to indirect and minority interests) applies (but see clause 21(3))
		The non-occupation outcome (as defined in clause 17)
5	Residential purposes incidental to a relevant business		The incidental residential use outcome (as defined in clause 14)
6	Occupation as main home or residence (but this outcome is only available to the extent that the commitment to reside in New Zealand test is met)		The occupation requirement (as defined in clause 6)		No key individuals are overseas persons
		The disposal requirement (as defined in clause 6)		No key individuals are overseas persons
7	Operation of existing shared equity, rent-to-buy, or rental arrangements (as referred to in the next column) in a development of 20 or more residential dwellings		All of the residential dwellings in the development are dealt with under 1 or more of the following arrangements that are satisfactory to the relevant Ministers: joint ownership of the residential dwelling with an occupier (for example, an arrangement commonly referred to as a shared equity arrangement): divestment of ownership of the residential dwelling to the occupier over a period of time (for example, an arrangement commonly referred to as a rent-to-buy arrangement): lease of the residential dwelling to an occupier: divestment of ownership of the residential dwelling
The non-occupation outcome (as defined in clause 17)
8	Any other case		The non-occupation outcome (as defined in clause 17)

Repealed

Notes

Schedule 2 clause 19(1): amended, on 25 February 2025, by section 6(6) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).
Schedule 2 clause 19(2)(c) item 7: replaced, on 25 February 2025, by section 6(7) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).
Schedule 2 clause 19(3): repealed, on 25 February 2025, by section 6(8) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

Exemptions from on-sale outcome and condition

20Exemption for large developments with shared equity, rent-to-buy, and rental arrangements

The relevant Ministers may decide not to impose a condition requiring the on-sale outcome if—
a person (OP) has applied for consent under either of the following:
1. the increased housing test in respect of residential (but not otherwise sensitive) land:
2. the benefit to New Zealand test in respect of land that is or includes residential land; and
the relevant Ministers are satisfied that the relevant land is intended to be used for the construction of 1 or more buildings that, taken together, will consist of 20 or more new residential dwellings (the large development).

The exemption in subclause (1) applies if the relevant Ministers are satisfied that—
all of the new residential dwellings in the large development will be dealt with under 1 or more of the following arrangements that are satisfactory to the relevant Ministers:
1. OP will jointly own the new residential dwelling with an occupier (for example, an arrangement commonly referred to as a shared equity arrangement):
2. OP will divest ownership of the new residential dwelling to the occupier over a period of time (for example, an arrangement commonly referred to as a rent-to-buy arrangement):
3. lease of the new residential dwelling to an occupier:
4. OP will divest ownership of the new residential dwelling; and
there is no reason to believe that the large development will not be dealt with according to those arrangements.

The exemption is subject to the following conditions:
all of the new residential dwellings in the large development are dealt with under 1 or more of the arrangements referred to in subclause (2)(a); and
OP meets the non-occupation outcome.

Notes

Schedule 2 clause 20(2)(a)(iii): amended, on 25 February 2025, by section 6(9) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).
Schedule 2 clause 20(2)(c): repealed, on 25 February 2025, by section 6(10) of the Overseas Investment (Build-to-rent and Similar Rental Developments) Amendment Act 2025 (2025 No 4).

21Exemption for indirect or minority interests in overseas persons that own or control land

The relevant Ministers may decide not to impose a condition requiring the on-sale outcome if—
a person (OP) has applied for consent under the benefit to New Zealand test in respect of an acquisition of rights or interests in securities referred to in section 12(1)(b); and
as a result of that acquisition, OP will have an indirect interest or a minority interest in an overseas person (A) that directly owns or controls an estate or interest in residential land described in section 12(1)(a) (the relevant land).

The exemption applies if the relevant Ministers are satisfied that, by reason of the circumstances relating to OP and the degree of control that OP will have in A, OP and its associates would not have, or would be unlikely to exercise or control the exercise of, any substantial influence over the relevant land.
The exemption is subject to the conditions that—
OP does not increase their ownership or control interest such that this clause would not apply; and
OP meets the non-occupation outcome.

In this clause, OP has an indirect interest in A if the relevant Ministers are satisfied that OP is an upstream party that has no direct ownership interest in A.
In this clause, OP has a minority interest in A if the relevant Ministers are satisfied that OP has a less than 50% ownership or control interest in A.
In this Act, a person (OP) has a 50% or more ownership or control interest in another person (A) if OP has—
a beneficial entitlement to, or a beneficial interest in, 50% or more of A’s securities; or
the power to control the composition of 50% or more of the governing body of A; or
the right to exercise or control the exercise of 50% or more of the voting power at a meeting of A.

Notes

Schedule 2 clause 21(1)(b): amended, on 16 June 2020, by section 55(3) of the Overseas Investment (Urgent Measures) Amendment Act 2020 (2020 No 21).