NEW BAN ON FOREIGN PURCHASES FOR EXISTING DWELLINGS
GOVERNMENT ANNOUNCEMENT
On 16 February 2025, the Federal Government announced that from 1 April 2025 to 31 March 2027, all foreign investors (including temporary residents) will be banned from purchasing established dwellings, unless an exception applies.
A review will be conducted to decide whether this ban should be extended past this date.
The Government also announced that foreign investors who have or are in the process of acquiring vacant land will be subject to increased scrutiny by the ATO and Treasury to ensure they meet the development conditions of their FIRB approval.
The ATO and Treasury will publish updated guidance prior to the commencement of these changes.
IMPACT OF THE ANNOUNCEMENT
Foreign investors must generally obtain Foreign Investment Review Board approval before purchasing residential property in Australia.
Foreign investors could be grouped into two categories:
1. FOREIGN INVESTORS WHO ARE NOT TEMPORARY RESIDENT OF AUSTRALIA
Previously, foreign investors have been limited to purchasing a new dwelling or vacant land on which to build a new house. Foreign investors have largely been prohibited from purchasing existing dwellings, thus the announcement will have very little impact on foreign investors that are not temporary residents of Australia.
2. FOREIGN INVESTORS WHO ARE TEMPORARY RESIDENT OF AUSTRALIA
Temporary residents, however, have been entitled to purchase one existing dwelling as their primary residence (where FIRB approval has been granted). The announcement would end the ability of a temporary resident purchasing an existing dwelling.
