TRIPLE INCREASE IN FEES FOR FOREIGN INVESTORS FOR REAL ESTATE IN AUSTRALIA
Recently, on December 10, Housing Minister Julie Collins and Australian Finance Minister Jim Chalmers announced that Australia would increase home purchase fees and fines for properties that are vacant and do not comply with regulations.
This adjustment will increase supply and ensure benefits for Australians. At the same time, the Government will cut foreign investment registration fees for “build-to-rent” projects to support housing supply.
This notice is issued with the following changes:
- Triple foreign investment fees for buying old homes.
- Double vacancy fees for foreign-owned homes purchased from 9 May 2017 (this also means a sixfold increase in vacancy fees for future purchases of already built homes).
- Strictly comply with the regulations of the Federal Tax Agency to ensure foreign investors comply with the law, including selling homes when necessary.
Foreign nationals are generally prohibited from buying existing real estate, but can do so in the case of coming to Australia to work or study. When they leave the country, they must sell real estate if they are not permanent residents.
Higher fees for already built homes will encourage foreign investors to invest in new housing developments. This creates more housing supply, jobs in the construction industry and supports economic growth.
Increasing the vacant house tax will encourage foreign landlords to rent out their vacant houses.
The government plans to draft a bill next year to introduce the new fees.
In addition, Minister Chalmers also said that the Labor Government will also reduce the fees that foreign investors must pay when they register to invest in “build-to-rent” projects.
Because currently, “build-to-rent” project investors are subject to different fees, which are higher if they involve specific types of land, such as residential land.
Reducing fees for these investments will ensure consistency and spur development across the country. In particular, providing long-term rental options for Australians.
Rates for “build-to-rent” projects will take effect after December 14, 2023.
Changes to investment laws for foreign investors are part of a plan to improve housing supply under the Albanese government.
Source: therealestateconversation
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