Please click on the links below to view this page in any of the following languages: Foreign Investment Review Board (FIRB)If you want to invest in the laid back Australian lifestyle, by looking to purchase a property Down Under we offer a simple way to achieve your Australian dream. In Australia, foreign investors are able to benefit from Australia’s physical beauty and political stability, and at the same time acquire wealth. Globalisation of the world’s financial markets has enabled foreign investment to significantly increase. Participating in this new world, Guardian Property Specialists is empowering overseas investors to own a property in Australia by simply, purchasing a property over the internet! Our web site provides all the information any overseas investor would need to purchase a property. This sections gives you a summary on Australia’s stance towards foreign investment, the entities involved and how to find out if your choice of investment property has foreign investment approval and if not, how to apply. Australia – ‘An Investment Haven’ Australia recognises the importance of direct foreign investment to the growth of the economies, by liberalising investment policies in order to encourage investment inflows. Therefore, the policy stance of the Federal Government is to welcome foreign investment in Australia providing it benefits economically and is consistent with the needs of the Australian community. By far the largest number of foreign investment proposals involves the purchase of real estate. The Government seeks to ensure that foreign investment in residential real estate increases the supply of residences and is not speculative in nature. The Government’s foreign investment policy, therefore, seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing (ie, new developments - house and land, home units, townhouses, etc) and brings benefits to the local building industry and their suppliers. Benefits for foreign investors include at times some of the following, comparatively high initial yields, low cost of funds, potential for income growth as rentals increase, and opportunity to obtain taxation benefits from depreciation and building allowances. Stability of the Australian market assures overseas investors Australia as a safe investment haven. Foreign interests may apply to acquire home units, town houses, house/land packages (where construction has commenced), strata titled hotel/motel units etc in a new development, either ‘off-the-plan’, during the construction phase or when the dwelling is newly completed, provided that it has never been occupied or sold and provided no more than 50 per cent of the dwellings in any one development are sold to foreign interests. A property purchased under this category may be rented out, sold to Australian interests or other eligible purchasers, or retained for the foreign investor's own use. All applications from foreign citizens or companies to buy residential real estate are put before the Foreign Investment Review Board (FIRB). FIRB The Foreign Investment Review Board (FIRB) was established in April 1976 for the purpose of assisting and advising the government in the administration of foreign investment policy. The Board examines proposals by foreign interests to undertake direct investment in Australia and makes recommendations to the Government on whether those proposals are suitable for approval under the Government’s policy. Residential Residential real estate means all Australian residential land and housing other than commercial properties (such as, offices, factories, warehouses, hotels, restaurants and shops) and rural properties (that is, land that is used wholly and exclusively for carrying on a substantial business of primary production). Acquisitions of ‘hobby farms’ and ‘rural residential’ blocks by foreign interests are considered to be residential real estate. The Government seeks to ensure that foreign investment in residential real estate increases the supply of dwellings and is not speculative in nature. The policy seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing (that is, new developments such as house and land, home units and townhouses) and brings benefits to the local building industry and its suppliers. The effect of the more restrictive policy measures on developed residential real estate is twofold. Firstly, it helps reduce the possibility of excess demand building up in the existing housing market. Secondly, it aims to encourage the supply of new dwellings, many of which would become available to Australian residents, either for purchase or rent. The cumulative effect should be to maintain greater stability of house prices and the affordability of housing for the benefit of Australian residents. New Dwellings New dwellings acquired ‘off the plan’ (before construction commences or during the construction phase) or after construction is complete are normally approved where the dwellings: - have not previously been sold (that is, they are purchased from the developer); and
- have not been occupied for more than 12 months.
There are no restrictions on the number of such dwellings in a new development which may be sold to foreign persons, provided that the developer markets the dwellings locally as well as overseas (that is, the dwellings cannot be marketed exclusively overseas). This category includes dwellings that are part of extensively refurbished buildings where the building's use has undergone a change from non-residential (for example, office or warehouse) to residential. It does not include established residential real estate that has been refurbished or renovated. A property purchased under this category may be rented out, sold to Australian interests or other eligible purchasers, or retained for the foreign investor's own use. Once the property has been purchased, it is second-hand real estate and is subject to the restrictions applying to that category. Second–Hand (Established) Dwellings This category includes all residential dwellings which are not new dwellings (that is, they have been previously owned and/or they have been occupied for more than 12 months). Acquisitions by individual(s) Foreign persons are prohibited from acquiring established dwellings for investment purposes (that is, they cannot be purchased to be used as a rental or holiday property), irrespective of whether they are temporary residents in Australia or not. Foreign persons who are temporary residents in Australia do not require approval to acquire a second-hand dwelling as their principal place of residence. Acquisitions by companies Proposals by foreign-owned companies to acquire second-hand dwellings for the purpose of providing housing for their Australian-based staff are normally approved subject to the following condition: - the company undertakes to sell or rent the property if it is expected to remain vacant for six months or more.
Vacant Land Proposed acquisitions of vacant land for residential development are normally approved subject to development condition(s) imposed under the FATA. Acquisitions of single blocks of vacant land (that is, land which is zoned to permit the construction of no more than one residential dwelling per block of land) for the purpose of building a single residential dwelling on each block are normally approved subject to the following condition: - continuous substantial construction must commence within 24 months.
- Acquisitions of other vacant land (not single blocks) for the purpose of building multiple residential dwellings are normally approved subject to the following conditions:
- continuous substantial construction must commence within 24 months; and
- at least 50 per cent of the acquisition cost or the current market value of the land (whichever is higher) must be spent on development.
Once these conditions have been fulfilled, properties acquired under this category may be rented out, sold to Australian interests or other eligible purchasers, or retained for the foreign investor's own use. Exemptions Certain acquisitions do not require notification or approval under the Foreign Acquisitions and Takeovers Act 1975 (also referred to as exempt acquisitions). Please note that we do not issue exemption letters. Real Estate You do not need to submit an application for approval to acquire real estate in Australia if: - you are an Australian citizen living abroad;
- your spouse is an Australian citizen (not a permanent resident) and you are purchasing residential real estate in both names as joint tenants (not tenants in common);
- you are a New Zealand citizen;
- you hold a permanent resident visa;
- you are a temporary resident and you are purchasing:
- single block(s) of vacant land;
- new dwelling(s); and/or
- a second hand dwelling to be used as your principal place of residence (including if it is going to be demolished first then redeveloped);
- you are purchasing new dwelling(s) from the developer, where the developer has pre approval to sell those dwellings to foreign persons;
- you are acquiring an interest in a time share scheme which does not permit you (and any of your associates) more than 4 weeks entitlement per year;
- you are purchasing certain residential real estate in an Integrated Tourism Resort (ITR);
- an interest in developed commercial property valued at less than $50 million or $953 million (indexed annually) for US investors, or $5 million for heritage listed properties where the acquirer is not a US investor;
- an interest in developed commercial property where the property is to be used immediately and in its present state for industrial or non residential commercial purposes. The acquisition must be wholly incidental to the purchaser's proposed or existing business activities;
- you are acquiring an interest by will or by operation of law (such as, a court order regarding the division of property in a divorce settlement, but not if both parties simply agree to transfer property without a court’s intervention); or
- you are purchasing property from the Government (Commonwealth, State or Territory, or local).
How to apply for FIRB approval? In many instances, Guardian Property Specialists and/or developer will get a pre-approval for a development. Applications for foreign investment in property developments have to consist of ten or more dwellings, for advance approval to sell up to 50 per cent of residences to foreign interests (in special circumstances, advance approval may also be given for developments consisting of between four and ten dwellings). In which, developers are required to provide a copy of their approval letter to each prospective purchaser and to report all sales (ie, Australian and foreign) to the Board. The initial report is due usually within twelve months and thereafter on a twelve monthly basis until all the dwellings in the development have been sold or occupied. Where such approval has been granted, it is not necessary for individual investors to apply. If a developer has not sought advance approval, ie not FIRB approved, then the individual investor should seek approval, Guardian Property Specialists can assist in submission of an application on an individual basis for overseas applicants. Source: firb.gov.au 
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