The Overseas Investment (Build to Rent and Similar Rental Developments) Amendment Bill has been described as a “game changer” for housing.

It introduces a “large rental development test” to attract much-needed overseas capital.

For years, the sector has struggled to gain momentum because of barriers to international capital and regulatory uncertainty. The decision changes that and signals New Zealand is open for build to rent (BTR) investment, Leonie Freeman, Property Council New Zealand chief executive says.

BTR, a purpose-built rental housing model offering professionally managed, long-term rental options, has been on slow but steady growth since the asset was formally recognised in 2023.

Research from the Property Council indicates developers could deliver 25,000 BTR homes in the next decade.

Property Council and partners Bayleys, Colliers, Savills, CBRE, and JLL track BTR sector growth across the country, with 1,841 completed units, 736 under construction, and 2,961 in the pipeline across 56 developments as at December 31 last year.

However, to scale effectively, developers needed access to investment that matches the long-term nature of these assets.

Freeman says attracting much-needed overseas investment will ensure BTR projects can be financed at scale.

“It will unlock opportunities to deliver more secure, high-quality rental options for New Zealanders.

“With supportive policy settings, our research shows that developers could deliver 25,000 build to rent homes within the next decade. That’s a significant contribution to increasing housing supply and providing renters with greater choice and stability,” Freeman says.

While the passage of the Bill is a positive step, the Property Council believes further refinements could enhance the sector’s growth.

Freeman is urging the government to consider introducing depreciation for BTR fitouts, clarifying GST rules around service levels and amenities, and ensuring the Residential Tenancies Act is appropriately applied to BTR tenancies.