Government plans to overhaul foreign property investor rules

A Federal Government proposal would make it more expensive for foreign investors to buy Australian properties, and encourage more foreign-owned properties to be listed as rentals.

Legislation expected next year would tighten the Government’s strict rules for foreign investment in residential properties.

It comes amid growing pressure on the Government to boost the supply of housing, as a shortage continues across Australia.

Investor fees

The Government has announced plans for new regulations of foreign property investments. The proposal includes increasing purchase fees on existing homes to encourage overseas buyers to build new homes instead.

Under current regulations, overseas investors can face yearly “vacancy fees” for properties that sit empty for more than six months and aren’t listed on the rental market.

Renovated or damaged properties are exempt. The rules also don’t apply if the owner’s relatives live in the property.

Changes

Next year, the Government will propose doubling the current vacancy fees for all properties bought by foreign investors after 9 May 2017.

You have read 0 articles this year.

Your contribution ensures The Daily Aus can continue doing the work you love.

Contribute

Close X

I want to give $10 monthly to help TDA keep doing the news.

MonthlySingle

$5$10$15$50

Other

Your details:

Contribute $10 Monthly

The Federal Government’s legislation would also triple the fees for foreign purchases of existing homes. With these changes combined, fees would increase to more than $169,000 a year for properties worth between $1 million and $2 million.

It doesn’t go as far as banning foreign investment in residential housing, as seen in countries like.

Housing

The Government said the increased fees are designed to boost investment “in new housing developments”. It also wants to encourage more foreign-owned properties to be listed as rentals.

National rental vacancy rates have been at a record low offor three months, according to Domain.

Chalmers estimated the new fees, as part of a proposed package of reforms, would bring in $500 million of additional revenue for more housing projects to increase supply.

Opposition

Nationals Leader David Littleproud has urged the Government to change the way foreign property ownership works in Australia.

Littleproud told Nine that “while we have a housing crisis, Australians should get a priority on buying homes in Australia”.