"Key steps that New Zealand can take to attract Chinese investment are making improvements to the education system and increasing the number of direct flights to China," he said.
"There is intense competition for Chinese investment dollars. New Zealand isn't the only country in the world whose economy is puttering along and that needs the impetus of foreign investment to get things going."
Tomorrow Morning: Fran O'Sullivan on New Zealand's Chinese investment challenge
New Zealand was one of one of six countries targeted for the capital injection and Sydney-based Juwai spokesperson Dave Platter said commercial, industrial, retail and residential properties were all targets.
"It will create jobs, new construction and economic growth. This will have the same effect on New Zealand as the demand for dairy products has had. The only difference is that the Chinese investors don't shift the properties overseas. They will pay taxes on them. It's a firm benefit for the majority of New Zealanders who owe property. They stand to benefit," Platter said.
The Juwai report found the second round of China's Qualified Domestic Individual Investor programme, known as QDII2, could see US$6.61 trillion of Chinese wealth invested in international real estate and other assets.
The first round of the capital outflow easing programme allowed Chinese institutional investors to invest funds overseas.
QDII2 will allow individuals in six cities - Shanghai, Tianjin, Chongqing, Wuhan, Shenzhen and Wenzhou - to move as much as half of their assets overseas.
Geoff Barnett, national manager of Century 21 with 20 agency offices, was unsurprised by the US$20 billion figure and predicted it would be poured into new buildings.
"It's nothing to fear. New Zealand needs overseas investment to help drive our economy. It's a good thing," Barnett said. "If it's going into development, it's going to help open up new properties so where's the downside to first home buyers? It should create an easing in the supply of properties."
Labour's housing spokesman Phil Twyford said Chinese people could buy nearly 20,000 houses with $15.9 billion, putting even more pressure on over-stretched stock.
"This shows the urgency of cracking down on the offshore speculation that is driving house prices beyond the reach of young Kiwi families," Twyford said. "Labour's policy is to ban foreign buyers, unless they intend to live here or by building new their investment adds to our housing stock."
Murray Horton of the Campaign Against Foreign Control of Aotearoa said the Government must follow Australia and impose tougher conditions on foreign buyers.
"They can only build a new house, not buy an existing one, thus adding to the housing stock and they can only own a house if they live in it themselves, not rent it out," Horton said of Australia's rules.
Credit Suisse analysts said Chinese investors spent A$8.7 billion on Australian residential properties in the last financial year, 60 per cent higher than a year earlier.
