Foreign buyers law change to boost housing

The federal government has introduced changes to foreign investment in the property market to boost housing supply across the country.

Treasurer Jim Chalmers and Housing Minister Julie Collins today introduced the Foreign Acquisitions and Takeovers Fees Imposition Amendment Bill 2024.

Under the Bill, the government will cut application fees for foreign investment in build-to-rent projects.

The legislation will also introduce higher fees to buy established homes and increased penalties for those that leave properties vacant.

This follows a move from Victorian parliament to increase land tax on vacant homes in early December. Tax changes on Victorian properties deemed vacant will start in 2025.

In October, Treasurer Rita Saffioti doubled down on the state government’s reluctance to eliminate the foreign buyer surcharge despite calls from the property industry.

Ms Saffioti told a Property Council WA event last year that concessions in Western Australia would apply to foreign buyers.

Business News previously reported industry experts found WA’s foreign buyer surcharge has deterred offshore investment, with buyers paying 12 per cent in duties if they bought a WA property.

Property Council of Australia research data from December shows the foreign-buyer surcharge has prevented up to 3,000 apartments from entering WA’s housing market, equivalent to 800 fewer dwellings a year.

Property Council of Australia policy and advocacy group executive Matthew Kandelaars said reducing foreign investment application fees for build-to-rent projects was the right move.

“Build to rent has the potential to deliver 150,000 new rental homes in the next ten years, but the settings must be right,” he said.

“In a competitive global capital market, promoting foreign investment into much-needed new housing makes sense.

“International capital, including Australian superannuation funds, is backing build-to-rent housing projects abroad as we speak.

“We need to redirect this capital to support the construction of new Australian homes.

“The nation won’t reach its 1.2 million homes target by 2029 without global investment.”