Australia is a great country to live or to holiday. Many people dream of moving to its golden shores because of the relaxed pace, comfortable lifestyle and stable economy. Thankfully, owning residential property in Australia is not too difficult for foreigners provided they meet some regulatory processes first.
The primary body that regulates investment by foreigners into Australia is the Foreign Investment Review Board (FIRB), who approves all property purchases in Australia by foreigners. The process for obtaining FIRB approval is not very difficult, is free and can be done entirely online. Generally an application to FIRB is approved within 30 days, and should not delay your purchasing process much.
If you would prefer to avoid the FIRB approval process, then you can purchase property in Australia without FIRB approval regardless of your visa status, if you purchase one of the following:
- A new property from a developer who has pre-approval to sell them to foreigners. These developments are typically large, with over 100 homes, and the developer has already done all the hard work for you. Many of these developers promote their properties internationally, so you are likely to come across them in your home country, which means you don’t even have to visit Australia to purchase the property. The developer can provide you with a copy of their pre-approval, so you have peace of mind that all the FIRB requirements have been met, or
- A residential estate in an Integrated Tourism Resorts. These are a very specific list of properties, and most are located in some of the popular tourist ares and islands in Queensland such as Hamilton Island Resort and Palm Cove. An ownership in one of these properties means that it will be available to lease to other tourists when you are not living there, making them a great way to have a holiday home in Australia that is looked after when you are not there.
If your dream home does not fit one of these categories above, then you will require FIRB approval and the level of red tape that must be complied with will depend upon the type of visa or legal status that you have in Australia.
If you are a temporary resident living in Australia you must notify FIRB if you are planning on purchasing a residential property or vacant land. Temporary residency means you have a visa that allows you to reside in Australia for over 12 months or have a bridging visa that allows you to live in Australia whilst applying for permanent residence (such as a 457 employer sponsored visa or 161 Business Visa). Different rules apply depending upon the type of property you wish to purchase.
If you want to purchase a property that has already been built and lived in (called an “established dwelling”), then it is like to be approved as long as you live in the property and sell it when your visa expires or you no longer live in it.
As a temporary resident, if you wish to buy a new property off-the plan from a developer, FIRB will normally approve these applications without any conditions because they increase the stock of existing property in Australia. Similarly an application to purchase vacant land for the purposes of building a residential property are usually not denied, however conditions may be attached to FIRB approval that require you to obtain building permits within a specific time period (usually about 24 months).
Non-residents of Australia, someone who does not have Australian citizenship and does not ordinarily live in Australia, must also obtain FIRB approval before purchasing a residential property. FIRB does not allow non-residents to purchase an “established dwelling” at all, because they want to ensure that existing dwellings can be purchased by Australian residents.
If you are a non-resident who would like purchase a holiday home in Australia then you would need to apply to purchase either a new property (such as off-the plan from a developer) or a block of vacant land on which you will then build a property. Similarly to temporary residents, these applications to FIRB are not usually denied, although there may be conditions about how quickly a building permit must be obtained for the vacant block.
If you choose to purchase a block of vacant and build your own house on it, it would be worthwhile engaging a good builder and conveyancer who can manage the process for you. If you are not living in Australia, the day to day requirements to obtain building permits, co-ordinate tradespeople and select fixtures and fittings can be challenging, and it would be helpful to have someone you can trust on the ground to do this for you.
Permanent Residents and Australian Spouse
FIRB approval is not required for a permanent resident visa holder or for a foreign national who is buying a property with their Australian citizen spouse. For the latter, the property must be purchased as “joint tenants”, which means that the property is owned in undivided shares, so if one spouse passes away the entire property passes to the surviving owner.
If you are deciding between investing in Australia and neighbouring New Zealand, don’t let the FIRB process put you off. New Zealand also has restrictions on foreign ownership that are similar to Australia, and in some cases more restrictive when it comes to many holiday homes and lifestyle properties. Considered to be “sensitive land”, it may be more challenging to get approval to purchase the type of property you want in New Zealand, particularly in rural areas.
Whilst it all sounds a bit daunting, the FIRB approval process isn’t anything to be scared of. It should be quick and rather painless, with the main purpose being to ensure that Australian residents continue to have affordable housing. Whilst the regulations restrict what type of properties non-residents can purchase in Australia, there are still plenty of opportunities to purchase good quality and affordable homes in great locations.