The Treasurer and Minister for Housing announced the ban on foreigners purchasing established dwellings in Australia on 16 February 2025. Our blog which can be found here, outlines the limitations.
At the time the Treasurer Jim Chalmers MP said, “This is all about easing pressure on our housing market at the same time as we build more homes. These initiatives are another important part of our already big and broad housing agenda which is focused on boosting supply and helping more people into homes.”
The landscape for Foreign Investment Review Board (FIRB) applications is clearly changing with the political landscape.
On 14 March 2025 the Treasury released updates to the changes to the foreign investment network.
These update guidelines include information on:
- Information on the ban on foreign purchases of established dwellings
- foreign investment in new and established build-to-rent developments
- the process for partial refunds of application fees for unsuccessful proposals in competitive bid processes
- proposed tax arrangements that will attract greater scrutiny in the foreign investment assessment process
Full details can be found on the Treasurys website.
A two-year ban on foreign persons being able to buy established dwellings
From 1 April 2025 to 31 March 2027 foreign persons will not be able to buy established homes.
Previously there were some exceptions the one which we saw mostly was the situation where temporary residents could apply for approval if they purchased the property for their principal place of residence and retained ownership of the property.
That exception for temporary residents has now been removed and the only exceptions are:
- Redevelopment into at least 20 additional dwellings
- Commercial scale established dwellings
- Build-to-rent developments
These are very limited exceptions and comprehensive legal and financial advice is needed to ensure the viability of the build and compliance with the new guidelines.
Build-to-rent applications will be subject to commercial land fee tiers where the fee increases in proportion to the value of the acquisition, with the lowest fee starting at $14,700 for acquisitions of $50 million or less.
Refund or credit of application fees in competitive bid processes
This scenario applies to where an application is made, and they are unsuccessful in a competitive bid process.
The applicant will have to choose between a 75% refund or a 100% credit by:
- Choosing between a 75% refund (which must be applied for within six months after being informed of an unsuccessful bid) or a 100% credit for a subsequent FIRB application that is made within 24 months of the failed bid, or
- If a fee credit is issued which can be used once even if the full value of the credit is not used for the first subsequent application where the credit is claimed.
Increased security of tax arrangements
It is clear that this government is taking a proactive approach to tax scrutiny and the impact of foreign investment on Australia’s tax revenues is of national interest.
The Treasury has released a revised tax checklist which outlines what the Australian Taxation Office requires to be included in any application.
New Foreign Investment Portal
A new foreign investment portal has been introduced by Treasury with a view to enhancing the management of applications and ensure compliance reporting.
The portal is being developed over stages and will require clients to:
- Register for a Digital ID
- Create a Foreign Investment Portal Account
- Link to an Organisation’s Account
- Submit Compliance Reports in the Portal
How can FC Lawyers help?
At FC Lawyers our experienced team have assisted clients from all over the world with the FIRB requirements.
Contact us to discuss your needs with any foreign investment questions you may have.
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