What Should You Do with Property Back Home When Moving to New Zealand?

When people relocate to New Zealand, they often leave behind a property in their home country. Many choose to hold onto it, whether out of uncertainty about returning, a desire to maintain a foothold in their old life, or simply as part of a diversified investment strategy. As someone who advises clients on this transition, I’m often asked: Should I keep my property overseas, or should I sell it? Here’s my take on this common dilemma—and what you might consider when making your decision.

Holding Onto Property: The First Few Years

For most people moving to New Zealand, keeping a property in their home country for a year or two makes sense. It’s a transitional period—a time to settle in, explore your new life, and decide whether New Zealand is where you’ll stay long-term. I often recommend holding off on selling until you’re about 80% confident of your plans. Are you committed to building a life here, or do you see yourself returning home?

There’s also a practical benefit to this approach: New Zealand offers a four-year transitional tax period for new residents. During this time, you generally don’t have to report or pay tax on overseas income—like rental income from a property back home. This can give you breathing room to assess your options without immediate tax pressures.

When Holding Becomes a Hassle

After those initial years, however, keeping an overseas property can start to feel more like a burden than a benefit. Here’s why:

1. Managing a Rental is Hard Work
   Owning a rental property from afar is no small feat. From finding tenants to handling maintenance, it’s a hassle—especially when you’re on the other side of the world.

2. Tax Complications Kick In
   After the four-year tax transition period ends, overseas income becomes taxable in New Zealand. For many of my clients from the UK, this is compounded by capital gains tax on property sales for non-residents. Plus, tax rules differ between countries—deductible expenses in the UK might not align with New Zealand’s requirements, leading to complex tax returns, accountancy fees, and added stress.

3. Opportunity Cost
   Holding onto a property that’s not serving a clear purpose ties up your capital. Could that money be working harder for you elsewhere?

For these reasons, many people choose to sell within the four-year window—unless the property has a compelling investment case.

When to Keep It

There are exceptions. If your overseas property is in a hotspot with rising value—say, due to infrastructure improvements or strong market demand—it might be worth holding onto longer. A standout investment proposition can outweigh the hassles and tax complexities. But if that’s not the case, and you’re reasonably confident about staying in New Zealand, selling often makes more sense.

What to Do with the Proceeds?

Once you’ve sold, the next question is: What now? The equity from your overseas property can open up new opportunities in New Zealand. Here are some common paths my clients take:

• Pay Down Your New Zealand Mortgage
  Use the funds to reduce or eliminate your mortgage here, giving you financial freedom and peace of mind.

• Invest in New Zealand Property
  Consider buying a home or investment property in your new backyard—whether it’s a family home or a rental.

• Diversify into Funds
  Put the money into managed funds or other investments for long-term growth.

There’s no one-size-fits-all answer. The best choice depends on your goals, risk tolerance, and stage of life. We work with clients to tailor advice to their unique circumstances—helping them weigh the pros and cons and make informed decisions.

Moving to New Zealand is a big step, and what you do with your property back home is a key part of that journey. Unless it’s an exceptional investment or you’re still unsure about staying, selling within the four-year transitional period is often the smart move. It frees you from headaches, simplifies your finances, and lets you redirect your resources toward your new life here. Want to explore your options? We’re here to help you figure out what’s best for you.