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Can foreigners buy property in Australia?
Yes, but investors must understand this guiding principle; Australian foreign residential property investment regulations are designed to increase Australia’s housing stock. If you apply to invest in, for example an established dwelling, you risk losing your money.
Types of Residential Property You Can Buy
- new and off-the-plan properties including houses and apartments
- residential land
- derelict properties for redevelopment to become habitable.
Brand new and off-the-plan dwellings: although the laws prohibit buying established homes, the purchase of brand new and off-the-plan dwellings is usually approved without conditions.
Residential Land: Applications for investing in residential land must be submitted to the Australian Taxation Office (ATO) for review.
Established Homes: Foreign investors will be refused any application to buy an established home unless they:
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- hold a temporary residence visa
- are resident in Australia and
- the property is used as your sole residence while living in Australia.
FIRB application fee 2023 (valid to June 2024)
The current (as at Aug 2023) Foreign Investment Review Board FIRB application fee 2023, for approval for buying residential property or residential land starts at $4000 and rises steeply.
For example, a property valued at $3 million or less attracts a fee of $56,400. For residential land valued at $5 million or less the application fee is $112,800.
Therefore we strongly recommend you familiarise yourself fully with the FIRB regulations and requirements before applying because, if your application is refused the FIRB fees are not refundable.
FIRB Vacancy Fee
May be payable annually by foreign owners of residential property. If the property is left vacant and is not advertised and available for rent for more than 6 months a year the fee is due. If you think you may be liable you may need advice from an FPB Registered Conveyancer or a suitably qualified Accountant before committing to purchase a property. Click on the contact us button below.
Remember that failure to comply with the FIRB legislation can result in penalties. Remember also that, because of the time, costs and risks involved in buying residential property as a foreign investor, it can be worthwhile getting qualified, personal advice from a local conveyancer qualified and experienced in the FIRB application process.
Your Frequently Asked Questions
No, unless there are very unusual circumstances. Whether your application is approved or denied there is very rare for the FIRM to refund the application fee.
Yes, but there are restrictions for existing homes for non-resident foreign investors. A temporary resident (who has a visa of more than 12 months) can purchase one existing home to live in for the duration of their visa but must sell it within three months of leaving Australia when their visa expires.
All foreign investors can purchase a house or apartment owned by a non-resident foreign investor. However all purchases must be FIRB approved before buy.
No, all properties purchased by non-resident foreign investors must be brand new or off-the plan.
No, a temporary resident must apply for approval to buy a single established property as a home to live in only after arriving in Australia. They must also have a visa that permits them to be legally resident in Australia for a continuous period of more than 12 months.
Yes, subject to FIRB approval. However, investment is limited to new and off-the-plan properties unless the property will be your personal residence and you apply after arriving in Australia.
Yes, but only if:
- it is an established dwelling and will be redeveloped and replaced with at least two new residences
- it is a derelict residence to be redeveloped to become habitable.
This can vary, but typically ranges from 30 to 90 days.
If your property is not occupied or rented out for 183 days (6 months) or more in a vacancy year, or you fail to lodge your annual vacancy fee return on time, a vacancy fee is usually payable.
This fee is likely to be the same as the application fee paid when submitting the residential property or exemption certificate application for the property. Fees are calculated when you lodge your vacancy fee return.
Yes. As a New Zealand citizen, you are eligible to buy property in Australia without approval from the Foreign Investment Review Board (FIRB). You can buy a new property, existing property, or vacant land. But, if you plan to buy rural or commercial property in Australia, it’s likely you will need FIRB approval.
Capital Gains Tax
New Zealand citizens who move overseas and retain property in Australia could be subject to capital gains tax (CGT).
If you cease to be an Australian resident while overseas The Australian Taxation Office (ATO) will assume some of your assets have been disposed of. Those assets could then be subject to CGT. This doesn’t apply to taxable Australian property.
If you become an Australian resident for tax purposes the ATO will assume you acquired your CGT assets at the same time, for their market value at that time. This is sometimes called ‘deemed acquisition’.
If you stop being an Australian resident for tax purposes the ATO will assume you’ve disposed of CGT assets for their market value at the time you stopped being a resident. The CGT assets don’t include taxable Australian property.
For more information on how changing residency affects CGT, please refer to the Australian Taxation Office CGT Guide and New Zealand Ministry of Foreign Affairs and Trade
