If you aren't an Australian citizen or permanent resident, buying residential property in Australia comes with extra federal rules and extra state costs. The rules are strict, they have changed recently, and the consequences of getting them wrong can be serious, so get advice before you sign anything.
Are you a "foreign person"?
Whether the rules apply depends on whether you are a "foreign person" under Australia's foreign investment laws. Generally, that includes:
- people who are not Australian citizens, permanent residents or New Zealand citizens, including most temporary visa holders
- people who are not ordinarily resident in Australia
- companies and trusts in which foreign persons hold a substantial interest
There are exceptions. For example, a foreign person buying jointly as joint tenants with a spouse who is an Australian citizen, permanent resident or New Zealand citizen may not need approval. Whether you are a foreign person can depend on your specific circumstances, so confirm your position before you commit.
Foreign investment approval
Foreign persons generally need foreign investment approval (often called FIRB approval) before acquiring an interest in residential land, regardless of the property's value. Applications for residential property are lodged with the Australian Taxation Office.
Application fees are payable when you apply, scale with the purchase price, and are generally not refunded if the purchase doesn't proceed.
What can foreign buyers buy?
Established homes: banned until 30 June 2029. From 1 April 2025 to 30 June 2029, foreign persons are generally banned from buying established (previously lived-in) dwellings. This includes temporary residents who want to buy a home to live in, which was previously possible with approval. Limited exceptions apply, such as some redevelopment proposals that significantly increase housing supply.
New dwellings, off-the-plan and vacant land. Foreign persons can generally still apply for approval to buy a newly built or off-the-plan dwelling, or vacant land to build on, subject to conditions such as completing construction within a set time.
Some new developments hold an exemption certificate covering sales to foreign buyers. Ask the developer whether one applies.
Protect yourself in the contract
Either obtain approval before you sign, or make sure the contract is expressly subject to foreign investment approval, with a right to end the contract if approval isn't given. Without that protection, a refused or delayed approval can leave you committed to a purchase you can't lawfully complete.
Penalties
Acquiring residential property without the required approval, or breaching the conditions of an approval, can lead to significant penalties, including orders to sell the property.
After settlement
Register the purchase. Foreign owners generally need to notify the ATO of the acquisition within 30 days of settlement.
Vacancy fee. An annual vacancy fee can apply if the property isn't occupied, or genuinely available for rent, for at least 183 days in a year. The fee can be substantial, so factor it into your plans if you won't be living in or renting out the property.
Extra state costs
Each state charges foreign buyers additional transfer duty and an additional land tax surcharge on top of the standard amounts. The rates and how they apply differ between NSW, Queensland and Victoria, and they change from time to time. See stamp duty for foreign buyers and your state's page for the current position, and confirm the figures with the relevant state revenue office before you commit.
Get advice before you sign
Foreign investment rules interact with your visa status, the type of property, how you're buying and the contract terms. Speak to a conveyancer or lawyer before signing, and before paying a deposit.
Sources
- Australian Taxation Office: Foreign investment in Australian residential property
- Foreign Investment Review Board
General information only, not legal or tax advice. Foreign investment rules and state surcharges change; confirm your situation with a conveyancer, lawyer or the relevant authority.
