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FOREIGN INVESTMENT BOARD
What is involved when non residents purchasing Australian property from overseas?
The Australian Government, through the Foreign Investment Review Board (FIRB), regulates the sale of Australian property to overseas persons and corporations.
Australian citizens living abroad who are holders of permanent visas or entitled to hold a 'special category' visa can purchase property in Australia without being examined by the FIRB. The term 'non-resident' for lending purposes applies to a person who:
Permanently resides out of Australia and is not an Australian citizen;
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Is an Australian citizen that has been living and working out of Australia for more than 6 consecutive months;
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Is not an Australian citizen but has been residing in Australia for less than 6 consecutive months.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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FOREIGN INVESTMENT
What is foreign investment?
The Australian Government's foreign investment policy has been developed to encourage investment in Australia and ensure that foreign investment is consistent with the needs of the Australian community.
The Government recognises the important contribution offshore investment makes to the development of Australia's industry, resources and community. Australian Citizens and Permanent Residents can acquire any property in Australia.
Foreign investment or a foreign interest is briefly described as a corporation, business or trust in which a foreigner and any associates have 15% or more ownership or in which several foreigners have 40% or more aggregate of the ownership.
There are various forms of investment and proposals with regard to foreign investment in Australian real estate.
These include the acquisition of:
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Developed commercial real estate valued at AUD$5 million or more;
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Residential real estate - irrespective of size;
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Residential real estate - irrespective of size - unless exempt under regulations.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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RESIDENTIAL
Foreign interests are usually given approval to buy vacant residential land on condition that construction of a dwelling is to commence within 12 months. Approval will also usually be granted to buy home units and townhouses off the plan, under construction or newly constructed (but never occupied), on condition that no more than half of the units in any one development are sold to foreign interests.
Other situations where approval is normally granted includes:
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Foreign companies buying residences in Australia for their senior executives
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Foreign nationals temporarily residenting in Australia for more than 12 months buying for their own use as a principal place of residence subject to the sale of the property when they cease to reside in Australia.
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Foreign nationals purchasing residential real estate as joint tenants with an Australian spouse.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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DEVELOPMENT
Proposed acquisition of real estate development (within 12 months) is normally approved unless it is contrary to national interest.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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COMMERCIAL
Proposed acquisitions of commercial development is normally approved unless it is contrary to the national interest. This is determined by the Government on a case by case basis.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us.
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GUIDELINES
In summary, buying guidelines are as follows:
| Category |
Buying Guidelines* |
| Australian Citizen or Permanent Resident |
No Restrictions |
| Temporary Resident, Retiree or Student |
Can buy new property without restriction or an established property provided it is your residence and it is sold when your visa expires. Consent of the FIRB is required. |
| Foreign National or Foreign Corporation |
Can buy new property. Can buy vacant land as long as building commences within 12 months of purchase. Can buy an established property only if an additional amount of no less than 50% of the original property cost is spent on improvements or additional construction. Can buy up to 50% of new projects or apartments. Consent of the FIRB is required. |
| Commercial Property under AU$50M |
No Restrictions to Foreigners. Some Rules apply. |
*guidelines are of a general nature. Please consult the FIRB
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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REVIEW PERIOD
How long does an FIRB review take?
Thirty days is needed for an application to be looked at by the FIRB. There are no "general" approvals available. An approval can only be granted on a specifically nominated property. Therefore, real estate contracts with foreign citizens must contain a clause saying that going ahead with the purchase is conditional upon getting FIRB approval and that 30 days must be allowed for that approval to be granted or denied.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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FOREIGN CURRENCY LOANS
Foreign Currency Loans offer borrowers, who may be residing either within Australia or offshore, the ability to borrow funds in a foreign currency, provided their main source of income is denominated in the same foreign currency.
Lawrence Commercial will be able to help meet the needs of a borrower's specific circumstances, simply contact us. |
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