Australia is to crack down on foreigners buying homes in the country, introducing visa checks, fines and new application fees to stop them exploiting laws governing foreign home ownership.
Currently, with the permission of the Foreign Investment Review Board (FIRB), non-Australian residents are able to buy new-build/off-plan properties in the country, although they are not entitled to buy established housing. However, temporary residents are able to buy established properties in Australia while their visas are valid, on the proviso that they then sell them within three months of leaving the country.
This loophole has been widely exploited in recent years, and the FIRB has come under fire for not doing enough to ensure the properties are sold within the requisite time – in fact, not a single investor has been forced to sell an illegally acquired home since 2008, in which times tens of thousands of homes have been purchased by foreign buyers..
An independent parliamentary committee was set up earlier this year to review the system and is set to announce its findings and recommendations going forward soon. Among these recommendations will be for the Department of Immigration and Border Patrol to play a more active role in advising the FIRB as soon as a home owner’s visa expires.
The committee is also expected to recommend fees of between AUS$500 and AUS$1,500 per successful application from a foreigner to buy a property, while a ban on marketing real estate developments solely to overseas investors will also be introduced.
According to the latest official figures, during the last financial year foreigners applied to buy AUS$5.4 billion worth of existing houses across Australia, almost double the tally for the previous year.
Article published 27th November 2014