Two markets, one country
New Zealand’s housing market is splitting in half along a fault line most people will never see. On one side, the national median dwelling value sits at $802,599, down 17.1% from its early 2022 peak. There are 24,100 unsold properties languishing on the market. Property withdrawals jumped 39% in February as sellers gave up waiting.
On the other side, NZSIR managing director Mark Harris reports “about half a dozen private jets arrived in Queenstown over the past few weeks and they continue to arrive regularly.” Buyers from the United States, Germany, Switzerland, Hong Kong and China are targeting homes above $10 million. The Iran conflict didn’t create this dynamic, but it has supercharged it.
The strike that moved capital
When US and Israeli forces struck Iran on 28 February, killing Supreme Leader Ali Khamenei, markets responded exactly as the textbooks predict. Gold hit a new all-time high above $5,500 per ounce, capping a 64% gain over the prior year. Brent crude briefly topped US$119 per barrel. In the US, roughly 55% of Americans now expect a recession or depression within 12 months.
For ultra-high-net-worth individuals, this triggers a familiar reflex: move capital to jurisdictions with rule of law, transparent markets, and stable tax regimes. Trophy real estate in supply-constrained locations is being treated as a structural hedge against geopolitical instability. New Zealand, geographically remote and politically stable, fits the profile perfectly.
The government built the on-ramp just as the traffic arrived
The Active Investor Plus visa, which allows those investing $5m-$10m in New Zealand to purchase residential property above $5m, became eligible for property purchases on 6 March, days after the Iran strike. The timing was coincidental. The consequences are not.
This partially reverses the 2018 foreign buyer ban that drove non-resident purchases down to just 0.3% of home transfers by early 2022. But the channel is deliberately narrow. Bayleys Queenstown chief executive Stacy Coburn estimates fewer than 450 houses nationwide qualify, with about 100 in the Queenstown area. Realestate.co.nz lists just 616 homes above $5m nationally, only 142 above $10m. It is a seller’s market within a buyer’s market.
The numbers from the ground
NZSIR’s $5m-plus sales are up 55.6% year-on-year, with the Southern Lakes accounting for nearly 80% of those transactions. Overseas buyer participation doubled from 6.5% to 13% between January-February 2025 and the same period in 2026, before the policy change even took effect. During the NZ Open, NZSIR recorded 14 sales in a single week, including one above $10m.
Luxury agent Cam Winter of Oliver Road reported a more than 600% increase in overseas buyer enquiries over two months, with notable interest from Poland, Ukraine, Germany and Switzerland. US-based traffic to realestate.co.nz rose 56% year-on-year, concentrated in higher-income states. More than 36,000 overseas-based searches for NZ homes above $5m were recorded over the past year.
Coburn confirmed the golden visa is already generating real activity: “We have actually got Americans out from San Francisco Bay looking at property who qualify under that scheme.”
Everyone else gets higher petrol prices
For the other 99% of the market, the Iran conflict is a headwind, not a tailwind. Cotality NZ chief property economist Kelvin Davidson said the conflict is “throwing an extra layer of uncertainty over everything” in a market already slow to respond to falling mortgage rates. Treasury scenarios suggest a sustained conflict could push inflation 0.5%-1% higher and shave 0.2%-0.4% off GDP.
BNZ’s Mike Jones said the conflict had injected “a lot of uncertainty” but did not expect large housing market impact unless it escalated or dragged on. That is the base case. The problem is that base cases have been wrong repeatedly over the past five years.
Safe haven or hollow town
The question the government has answered without much public debate is whether New Zealand should deliberately position itself as a geopolitical bolt-hole for the ultra-wealthy. The Active Investor Plus visa is designed to attract productive capital, with residential property as a sweetener. But when conflict drives buyers from Poland, Ukraine and the US to compete for fewer than 450 eligible homes in a town that already struggles to house its own workers, the sweetener starts to look like the main course.
Former World Bank senior economist Ralph Hanan warned that Queenstown was on track to be hollowed out unless authorities built more affordable housing for workers. The Property Council argues offshore capital could flow into new supply as well as existing stock. That is the optimistic read. With only 142 properties listed above $10m, the realistic read is that foreign capital is competing for scarce stock without adding a single dwelling.
Realestate.co.nz CEO Sarah Wood acknowledged the asymmetry: “Foreign buyers searching for homes above $5 million represent less than one percent of total activity on the platform, but the capital involved in each transaction is significant.”
For the premium Southern Lakes market, geopolitical instability is now a demand driver. For the rest of the country, it is a confidence tax. Those two realities will coexist for as long as the conflict does, and the gap between them will only widen.
Sources
- NZ Herald: Foreign buyers rush into Queenstown luxury property as rules ease
- Otago Daily Times: Rich foreign buyers flock to properties
- CFOtech NZ: Foreign investors buying property NZ target luxury homes above $5 million
- OneRoof: Queenstown ‘gazillionaires’ – Surge in ultra-wealthy foreign buyers chasing luxury escape
- interest.co.nz: Middle East war and oil shock ‘throwing an extra layer of uncertainty over everything’
- TheSuperPrime: Super-Prime Market Intelligence – Geopolitics rules above all
- Stats NZ: Property transfer statistics – March 2022 quarter
- Staircase: New Zealand Property Market Outlook 2026 – Geopolitics, OCR & Inflation
- Property Council NZ: Building Through Uncertainty
- OneRoof: Iran war not a cause for house price panic in NZ, say experts
- interest.co.nz: The housing market may be about to face its biggest challenge since the Covid pandemic