New Zealand property: The duration of housing cycles have been shorter and more cyclical with consequently more peaks and troughs, however despite high interest rates prices have continued to rise and defy the Reserve Bank’s attempt to cool the market.

New Zealand dollar: The NZ dollar has been made gains at the start of the second half of 2006 correcting earlier weakness having reached a 22 month low in March. Nevertheless, the US dollar continues to strengthen against the NZD.

Economic climate: The Reserve Bank interest rate currently remains steady at 7.25%. New Zealand is currently examining ways of engaging its economy in more global markets in order to reduce its balance of payments.

Taxes: There are no capital gains, land or estate duty taxes in New Zealand. Income tax ranges from 19.5 per cent to 33 per cent. GST (sales tax) applies to all goods and services, at 12.5 per cent of the cost price. There is a double tax agreement in place with many countries, including the United Arab Emirates.

Popular areas: Coastal property in Northland (upper North Island) and Auckland CBD apartments around inner harbour are particularly sought after. Areas in Queenstown and surrounding Southern Lakes are considered the jewel of the New Zealand tourist industry.

Price ranges: Residential property ranges from NZ$250, 000 to NZ$2,000,000.

Budgetary guide: Two-bedroom apartments range from NZ$290,000 to NZ$350,000, single storey houses from NZ$250,000 to NZ$600,000, luxury houses (example Queenstown area) between NZ$1.5 million and NZ$2 million.

Overseas investors: There are no limitations on foreign ownership, except rural properties that exceed five hectares in area or land deemed by the Overseas Investment Commission as sensitive land, i.e. over one acre adjoining a lake or sea foreshore and commercial property over NZ$10 million.

Service fees: There is no stamp duty in New Zealand. Legal and accounting fees depend on how a purchase is structured and funded. Allow a budgetary sum of NZ$12,500. Fifty per cent of the legal fees will be paid during the purchase/contract process. Rates, typically NZ$3,500 per annum paid to the local council in advance in five instalments.

Mortgages: Home loans are normally made available up to 70 per cent. Featured mortgage rates: Public Trust 1 year fixed 8.25%, Wizard 3 year fixed 8.19%, Westpac Bank 5 year fixed 7.95% and TSB Variable 9.5%.

Information: www.nzherald.co.nz The New Zealand Herald,
www.nzpropertyresource.co.nz portal to local government property information.