It is important to note the following with respect to purchasing in a retirement village in Australia:
- Buying into a retirement village can be more complicated than buying or selling other real property;
- There is a variety of purchase and payment models for retirement villages and different offerings in respect of facilities, accommodation and services;
- Each state and territory has specific laws around the operation of retirement villages;
- There may be fees associated with leaving a retirement village and/or restrictions on selling your home in a retirement village;
- There are consumer law rights you may be entitled to when purchasing in a retirement village.
Therefore, it is imperative that you obtain independent legal advice prior to entering into a retirement village contract. We are able to assist in this regard.
When is FIRB approval required?
FIRB approval is required where a temporary resident or foreign investor wishes to purchase residential property in Australia, with penalties for foreign acquires failing to comply.
Generally, a person who is not a permanent resident or citizen or a corporation where a substantial interest is held by a foreign person is deemed to be a “foreign person” for the purposes of FIRB.
Do I need to obtain FIRB approval when buying in a retirement village?
There are provisions in the Foreign Acquisitions and Takeovers Regulation 2015 (“the Regulations”) with respect to exemptions for certain actions.
Division 3 of the Regulations note the exemptions for certain actions which do not require FIRB Approval and section 37 of the Foreign Acquisitions and Takeovers Act 1975 provides that the Regulations can provide for an FIRB exemption.
Section 38 of the Regulations note the specific acquisitions of interests in residential land that do not attract the requirement to apply for FIRB approval, including an acquisition of an interest in a retirement village (s 38(5)(a)(ii) of the Regulations).
This means that you are not required to obtain FIRB approval should you wish to acquire an interest, as a foreign person, in a retirement village in Australia.
What should I do if I am unsure if I need to obtain FIRB approval?
It is crucial that you speak with us before signing a contract to purchase a property, so you may double check whether or not FIRB approval is required.
Contact our team today to speak with us regarding any FIRB or property matters.
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