Can a foreign person buy property in Australia?

Investing into Australian real estate is very desirable for many foreigners. Although it is possible for a foreign person to buy property in Australia, there are certain rules and regulations they need to follow.

Who needs approval to purchase property in Australia?

Generally, a foreign person requires approval from the Foreign Investment Review Board (FIRB) to purchase property in Australia. This applies to foreign persons living overseas or persons visiting Australia on a temporary visa.

Who does not need approval from the Foreign Investment Review Board?

Some foreign persons do not need approval from the Foreign Investment Review Board. These people are permitted to purchase a property in Australia without obtaining any special permission. This includes:

• New Zealand citizens
• Permanent residents (holders of permanent visas)
• Foreign non-residents who are buying with their Australian or New Zealand citizen spouse or permanent resident spouse

In addition, some properties are exempt from FIRB rules (which means you do not need to apply for FIRB approval to buy them). This includes:

• New dwelling purchased from a developer who holds an exemption certificate allowing them to sell some dwellings in the development to foreign persons
• An aged care facility, retirement village or some types of student accommodation (thresholds apply – please let us know if you are considering such facilities)

What type of property can foreign persons buy in Australia?

Foreign persons (who are NOT developers) may buy new residential properties in Australia. This includes:

• A dwelling under construction (off the plan purchase);

• A recently built dwelling that has not been previously sold as a dwelling and:
• Has not been previously occupied or
• If still owned by the developer, has not been previously occupied for more than 12 months in total.

• Land that has been subdivided for the first time (never had a dwelling constructed on the land), provided that you construct a residential dwelling on the land without four years of the date of approval.

If a foreign non-resident purchases property in Australia and the property is vacant for at least 6 months of every 12 months, then the owner is required to pay an annual vacancy charge.

What type of property can a temporary resident purchase?

A person who holds a temporary visa but has submitted an application for a permanent visa and holds a bridging visa which permits them to remain in Australia until their application for a permanent visa has been finalised, may be able to purchase a single dwelling (does not need to be a new dwelling) to reside in while in Australia. They must first obtain approval from the Foreign Investment Review Board.

How do you apply for approval from the Foreign Investment Review Board?

Foreign persons must obtain approval from the Foreign Investment Review Board before they sign a contract to purchase a property.

To apply for approval from FIRB, you need to submit your application electronically through the ATO website. It’s best to apply for approval as soon as possible because applications can take up to 30 days to process.

What else do you need to know?

We recommend foreign persons obtain legal advice before they decide to invest in the Australian property market. A substantial fee is payable for persons who apply to the FIRB for permission to purchase property. In addition, other fees may be payable including surcharge stamp duty and land tax.

Our team of property law solicitors are able to provide personalised legal advice to any non-resident purchasing property in Australia. Contact our office for a free 15 minute consultation.