Over the past decade, New Zealand’s housing market has been in a state of flux – to say the least! Property prices have shot up all over the country, and are continuing to rise – and are some of the most expensive in the world.
Recently, we’ve seen broad changes around who can buy and sell property in New Zealand. Generally, you’ll need to be a citizen or a permanent resident to buy a property, although there are some exceptions. Lending rules have changed as well, with most banks and lenders requiring higher deposits and anti-money laundering rules adding more hoops to jump through. To put it mildly, it’s a complex market and even trickier if you’re living overseas, or earning money from international sources. It will be a great idea, if you find a good mortgage broker in Auckland while applying for home loan by using your overseas income. A good mortgage adviser can help you to explain current lending criteria & help to prepare all documentation.
So, can you use international income to qualify for a loan in NZ? The answer isn’t straightforward.
Can you buy a house with money from overseas?
In this digital age, you can be living in one country and earning some or all of your income from another. While that has implications on your tax payments, it’s still fairly simple to use that income to qualify for a home loan in New Zealand. The banks will be interested in three things: how much you earn vs how much owe and spend, how much cash you have saved, and how secure your income is. If you’re a contractor earning from international clients, banks may see your income as less secure than if you’re employed by an international firm, for example. There may be some added complexity in proving your income in a form that the bank is happy with, but any excellent mortgage broker will be able to help guide you through the process.
What if I’m living overseas?
If you’re a citizen of NZ, Australia, or Singapore, you can legally buy here while you’re still living and working overseas, but getting a loan may be much more difficult. Many banks and non-bank lenders have tightened their rules around lending to non-residents with non-NZ income. You’ll generally need a larger deposit – at least 30%, so your borrowing power is drastically reduced. You’ll also need to be earning from a salary or wage, not from self-employment.
Even with those boxes ticked, some banks will still say no. Westpac, for example, will no longer lend to non-resident borrowers with overseas income.
How to buy a house with international income?
If you’re living in NZ and earning money from overseas, the simplest way to get into a property is to talk to a great mortgage broker. Lending criteria of the major bank and non-bank lenders change almost daily, so approaching each directly could mean a lot of paperwork, and a lot of disappointment! A mortgage broker will understand which banks will still be happy to lend to you, and which won’t. They’ll also advise you on how to package up your financial information to present the best view to the bank and help you sidestep potential issues that could get in the way of the big ‘yes’ stamp.
Consult an expert
Property values rising, money-laundering rules, residency in another country, proving your overseas income is secure – these are some of the complexities you’ll face when you want to buy a home in New Zealand with overseas funds. You can still do it if you tick all the right boxes and satisfy your lender that you’re worth the risk.
But why put yourself through the stress, when a mortgage broker can smooth the way for you?
Talk to Global Finance today about how to turn your overseas funds into a home.