The Australian government is set to review its policy on allowing foreigners to purchase property in the country after a raft of purchases made by overseas buyers, particularly from China, were blamed for pushing prices in the country out of the reach of many locals.
Currently, overseas buyers can typically purchase new build/off-plan properties in the country, providing they receive prior permission from the Foreign Investment Review Board (FIRB).
“It is the government’s policy that foreign investment in residential real estate should increase Australia’s housing stock,” said a spokesman for the FIRB. “That is, the policy seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing and brings benefits to the local building industry and its suppliers. All residential real estate applications are considered in light of this overarching principle,” he added.
However, there is a real concern that too many foreign buyers means that local people are being priced out of the housing market in some of the country’s most popular areas – most notably Melbourne and Sydney.
In light of these concerns, the government has announced that an independent inquiry will examine the current overseas purchaser policy to see if it needs to be changed so that new homes being built in Australia can benefit local people, especially first time buyers.