The answer to this question is not actualised and the government is working on finalizing some official incentives and regulations. But here is the limited information we can find on the government website and here is some information for your reference only.

These measures aim to make Build to Rent an attractive option for developers by reducing financial risks and regulatory burdens, thereby supporting the development of new, quality rental housing that meets the needs of a diverse range of tenants.

The “Build to Rent” initiative offers several incentives and benefits for developers considering these types of projects in New Zealand:

  1. Exemption from Interest Limitation Rules: Build to Rent developments are permanently exempt from the interest limitation rules that generally restrict the ability for property investors to deduct interest costs against their income. This exemption applies both to new and existing Build to Rent developments and is designed to encourage continued investment in the housing market, particularly in creating long-term rental housing options​ (Te Tūāpapa Kura Kāinga – MoHUD)​​ (Te Tūāpapa Kura Kāinga – MoHUD)​.
  1. Stability and Long-Term Tenancies: The government promotes Build to Rent properties as offering long-term security and stability for tenants. This is appealing for developers as it fosters a stable rental income stream. Tenants in these developments can be offered fixed-term tenancies of at least 10 years with flexible termination options, which helps in reducing turnover rates and maintaining consistent occupancy​ (Te Tūāpapa Kura Kāinga – MoHUD)​.
  1. Tax and Regulatory Support: The government’s framework includes specific definitions and requirements that Build to Rent properties must meet to benefit from these incentives. This includes having a certain number of dwellings within a development and providing clear personalization policies and long-term tenancy options, which align with enhancing tenant stability and satisfaction​ (Te Tūāpapa Kura Kāinga – MoHUD)​​ (Te Tūāpapa Kura Kāinga – MoHUD)​.
  1.  Build-to-Rent developments under the Overseas Investment Act 2005 confirms and expands upon the benefits and incentives available for developers interested in Build-to-Rent projects in New Zealand, as discussed on the HUD website. Here’s a concise summary based on the PDF content:
  • Streamlined Consent Pathways: Developers engaging in Build-to-Rent projects with 20 or more dwellings benefit from streamlined pathways for consent under the Overseas Investment Act 2005. This makes it easier for developers, particularly those not previously involved in Build-to-Rent, to initiate and proceed with their projects.
  • Exemption from Interest Limitation Rules: Similar to the information from the HUD website, the document confirms that Build-to-Rent developments are exempt from the interest limitation rules. This exemption is crucial as it facilitates ongoing investment by allowing developers to deduct interest costs, enhancing the financial viability of such projects.
  • Flexibility for Mixed-Use Developments: The Act accommodates mixed-use developments that include Build-to-Rent components, offering different consent pathways for various parts of the development. This flexibility is beneficial for developers looking to combine residential and commercial elements in their projects.

These incentives are designed to attract more developers into the Build-to-Rent sector, supporting the government’s goals of increasing housing supply and providing stable, long-term rental housing options. This strategic approach not only simplifies the investment process but also ensures that Build-to-Rent developments contribute positively to New Zealand’s housing market landscape.