10/31/2017 11:11 EDT | Updated 10/31/2017 11:14 EDT

New Zealand Moves To Ban Foreigners From Buying Homes

"We stand strongly in favour of the view that housing is a right."

Hagen Hopkins via Getty Images
New Zealand's prime minister, Jacinda Ardern, makes a speech upon her arrival at Parliament after a swearing-in ceremony at Government House on October 26, in Wellington, New Zealand. Ardern says her government is moving quickly to institute a ban of foreigners buying homes in the country.

WELLINGTON, New Zealand New Zealand's new government is moving quickly to fulfill a campaign promise by banning foreign investors from buying homes.

Prime Minister Jacinda Ardern announced Tuesday that she expects to introduce new laws within weeks that would take effect early next year. She said the government is determined to make it easier for New Zealanders to buy homes and to stop foreigners from driving up prices.

"We stand strongly in favour of the view that housing is a right,'' Ardern said.

Watch: Jacinda Ardern sworn in as New Zealand's PM

Ardern, who leads the liberal Labour Party, was sworn in as prime minister last week following nine years of conservative rule.

She said the ban would not affect most existing free-trade agreements and would be enacted before the proposed Trans-Pacific Partnership, a free-trade deal that 11 nations, including Japan and Australia, are considering signing.

It is unclear whether the New Zealand government will still sign up for that proposed deal. Ardern said it's trying to renegotiate arbitration clauses that would allow investors to sue governments.

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"We are going in with the explicit intent of trying to remove New Zealand from these clauses,'' she said. "But I will acknowledge it's very difficult at this late stage to achieve that outcome.''

She wouldn't say whether the clauses were enough to make New Zealand walk away from the deal, saying she wanted to maintain a bargaining position.

Aussies exempt

Under the proposed housing legislation, Australians and foreigners who are New Zealand citizens or residents would be exempt. Foreigners could also continue to buy residential land to build new homes.

The opposition National Party said the so-called ban raised more questions than it answered.

"This is a policy that's designed to solve a political problem,'' said Steven Joyce, the National Party's finance spokesman. "Evidence in both Australia and here in New Zealand is that overseas buyers don't have a significant impact on the housing market.''

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