Non-residents of Australia may have to pay extra fees when applying to buy a house, as the government looks at ways of cooling rising house prices in the country.
An influx of foreign purchasers buying newly built homes in the country has been blamed by some experts for sparking significant house price rises over the past couple of years. This influx of overseas buyers has been especially noticeable from China – transactions involving Chinese buyers rose 60 per cent last year – although the government has stated that any measures would not be aimed at one particular country.
Speaking last week, Australia’s Prime Minister, Tony Abbott, said that the government was proposing a range of fees and civil penalties to deter foreign buyers.
One possibility is that a foreign investor who wanted to buy property worth less than AUS$1m would have to pay a AUS$5,000 application fee in order to be able to do so. All foreign buyers of Australian property must apply to and receive permission from the Foreign Investment Review Board before they are allowed to purchase a home. This permission is typically only granted to those buying newly built, or off-plan, properties.
Investments worth more than AUS$1m would incur a AUS$10,000 fee for every extra million dollars.