If you’ve ever visited New Zealand, chances are that the thought of living or retiring there has crossed your mind. Known for its exceptional beauty, moderate climate, adventure activities, and laid-back lifestyle, New Zealand is hugely diverse geographically, but compact enough that you can enjoy a variety of activities in a single day. Like adventure? You can surf in the morning, kayak in the afternoon and bike through a redwood forest in the evening. Is leisure more your style? Try a morning whale watch tour, followed by a visit to one of New Zealand’s many vineyards.

Although New Zealand would be the dream retirement destination for many, few can actually afford to settle there due to the strict financial requirements for obtaining a visa and relatively high cost of living. If you are fortunate enough to have a healthy nest egg, however, retiring in New Zealand may be an option. Here, we take a look at how much it takes to be able to fulfill that dream.

Temporary Visas for Retirees

Unless you have adult children living in New Zealand (which qualifies you for a different type of visa) you’ll probably apply for a Temporary Retirement Visitor Visa, which is good for two years and is renewable. To apply, you’ll have to pay the NZ$70 (USD$46.40, as of July 6, 2019) application fee and meet all of the following requirements:

  • Be at least 66 years old;
  • Invest NZ$750,000 (about USD$497,182) in New Zealand during the two-year visa period;
  • Show that you have NZ$500,000 (about USD$331,455) of maintenance funds and at least NZ$60,000 (about USD$39,774) in annual income;
  • Meet standard health and character requirements; and
  • Have comprehensive travel and/or health insurance during your stay.

After two years, you can reapply if you still meet all the requirements – and you can show that you have maintained your travel and/or health insurance and that your investment funds are in acceptable investments (e.g., bonds issued by the New Zealand government or firms traded on the New Zealand Debt Securities Market, equity in New Zealand firms, and residential property developments). 

Cost of Living

The cost of living in New Zealand is comparable to many U.S. cities, though it is more affordable than large cities such as New York. Numbeo.com is an online database that compares the cost of living in various cities worldwide. Its Consumer Price Excluding Rent Index (CPI) is a relative indicator of consumer goods costs, including things like groceries, restaurants, transportation, and utilities. New Zealand’s CPI was 3.64% higher than the United States as a whole, excluding rent, as of July 6, 2019. The average New Zealand rent was 21.72% lower than the average U.S. rent..

According to Numbeo.com, average monthly rent for a one-bedroom apartment in the city center was $968.25 (USD); for a three-bedroom apartment, the rent averaged $1,585. Outside the city center, rent averaged $785 and $1,308 for one and three-bedroom apartments, respectively. (Note that all these numbers are updated – and change – regularly.)

Property Ownership by Foreigners

Foreigners can purchase property in New Zealand, but need approval from the Overseas Investment Office if the property has a purchase price greater than NZ$10 million (US$6,629,101), or if it’s what’s deemed a “sensitive” area: land next to a coastal area, lakes, and islands, and rural (and farm) land. In general, if you want to buy a house to live in, there will be no restrictions. Still, it’s important to note that property ownership, while counting toward your "investment" credit, does not give you the right to live permanently in New Zealand. You still have to go through the proper immigration channels to apply for and renew your visa.

Like any real estate market, the price of property depends on location and amenities. You can find a basic three-bedroom house in the central North Island area for NZ$75,000 (US$49,718), or a 5-bedroom/6-bath waterfront mansion in Auckland for NZ$13 million (US$8,617,832) Depending on where you want to live and your housing preferences (size, style, etc.), it might make financial sense to buy rather than rent. Once you decide on a general area, you can compare local rent and real estate listings, or work with a real estate agent to find out which options makes the most sense.

The Bottom Line

The financial requirements for temporary visas are notably high: Depending on the exchange rate, you need more than $800,000 in investments and maintenance funds to retire in New Zealand, not counting the additional requirement of nearly $40,000 in annual income. You’ll likely need more than the required assets and sources of income (including Social Security), to make it work. All the same, while it’s expensive to get your foot in the door, once you’re in New Zealand, the cost of living is comparable to (or cheaper than) many places in the United States.

New Zealand is an incredibly beautiful country (watch "The Hobbit" or "The Lord of the Rings" to catch a glimpse of the scenery), with everything from snowcapped mountains, volcanoes, and glaciers, to lush forests, sunny beaches, and natural hot springs. To top that off, the people are friendly, the food and wine are excellent, the climate is moderate and, if you speak English, you don't need to learn another language.

New Zealand’s immigration department sums up the country’s attractions: “In many ways, it’s not what we have that’s important to the quality of our life – it’s what we don’t have. We don’t have high crime rates, our police don’t carry guns and instances of corruption are virtually unheard of. We don’t have abject poverty or hunger and we don’t have pollution, congestion, health issues and cramped city living that we see elsewhere.”