New Zealand announced a tax on property to curb its rampant housing market

Photo by Romina Amato/Red Bull via Getty Images

In an effort to take some heat out of the Auckland property market New Zealand Prime Minister John Key has announced today a tax of up to 33% on any property that is bought and sold within two years of purchase.

This only applies where the home is not the seller’s main residence, said Key, with the measures taking affect from October 1st.

According to Key, the aim of the rules is “ensuring that property buyers – including overseas speculators – who buy residential property with the intention of selling for a gain pay their fair share of tax as required by the law”.

“It’s not unreasonable to expect that if you buy an investment property and sell it for a gain within two years, then you should be taxed on that gain,” Key said.

Key also announced that the Inland Revenue would receive extra funding and that foreign buyers will need to register with Inland Revenue.

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