Can Foreigners Buy Property in Australia? The Facts That Matter

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Australia remains one of the most attractive destinations for overseas investors and temporary residents alike. Whether it’s our stable property market, clean environment, or long-term visa options, many foreigners are keen to secure a piece of the Australian dream. But while the property is available, the process is anything but simple.

If you’re a foreign individual or acting for a foreign client, there are some critical rules to understand. As licensed Victorian conveyancers, we deal with these matters regularly. So let’s break down what you need to know with all the who, what, when, where, how and why—and back it all with facts.

Who Can Buy Property in Australia?

Foreigners can buy property in Australia, but not all buyers are treated equally. The term "foreign person" covers:

  • Non-resident foreign citizens

  • Temporary residents (such as student visa or skilled work visa holders)

  • Foreign corporations or trusts controlled by non-residents

Exemptions include:

  • Australian citizens, even those living overseas

  • Permanent residents

  • Purchasers buying with an Australian citizen spouse, though this comes with strict conditions

Reference: Australian Taxation Office – Foreign Investment

What Can Foreigners Actually Buy?

Foreign investment rules are not just about who is buying, but what they want to buy. Here's the basic breakdown:

  • ✅ New Dwellings: Apartments or houses that have not been lived in previously.

  • ✅ Vacant Residential Land: Provided construction of a home begins within 4 years.

  • ✅ Redevelopment Sites: You can buy an existing home only if you plan to demolish it and increase housing stock (e.g. replace one home with two).

But...

  • ❌ Established Dwellings: Not allowed for non-residents or investors as of 1 April 2025. Temporary residents may buy to live in, but must sell upon leaving Australia.

Reference: Foreign Investment Review Board (FIRB) – Guidance Note 1

When Does FIRB Approval Need to Happen?

Before you do anything. FIRB approval must be granted before entering into a binding contract. This applies even for off-the-plan or conditional contracts unless those conditions include FIRB approval itself.

Expect at least 30 days for processing—and it won’t begin until the correct application fee has been paid.

Reference: FIRB Fee Rules

How Much Does FIRB Approval Cost?

The cost is based on the property’s value. As of March 2025, fees start at:

  • $14,100 for residential land under $1 million

  • Fees scale upward significantly as values increase

Each application is per property. So, two purchases mean two separate applications and fees.

Reference: FIRB Fee Schedule

What Extra Taxes Apply in Victoria?

Foreign buyers pay more than locals. In Victoria, you’ll be hit with both state and annual taxes:

1. Foreign Purchaser Additional Duty (FPAD)

  • 8% extra on top of regular land transfer duty (stamp duty)

  • Applies to all residential property purchases by foreign buyers

Reference: State Revenue Office Victoria – FPAD

2. Absentee Owner Surcharge (Land Tax)

  • 4% annually for absentee owners on the total taxable land value

  • You must register with the SRO and notify them each year if you qualify

Reference: SRO Victoria – Absentee Owner Surcharge

Can Foreigners Get a Loan?

Yes—but it’s not always easy. Banks have their own lending criteria and many won’t deal with foreign buyers at all.

Common requirements:

  • FIRB approval must be provided first

  • Larger deposits (30% or more)

  • Strict proof of foreign income and savings

  • Exchange rate risk assessments

Reference: Canstar – Non-Resident Home Loans

Why Is This All So Important?

Because getting it wrong can cost you big:

  • ⚡ Penalties: FIRB breaches can result in civil penalties, property forfeiture, or even criminal charges

  • ⚡ Tax underpayments: The State Revenue Office conducts audits and issues fines with interest for unpaid foreign duties

  • ⚡ Delayed settlements: Buyers who fail to obtain FIRB approval on time may be forced to withdraw from contracts or forfeit deposits

Reference: FIRB Enforcement

Planning Ahead – What You Should Do

If you're a foreigner considering buying in Victoria, or you're acting on behalf of one, here are the steps we recommend:

  1. Get advice early. Before signing or even offering, confirm whether FIRB applies.

  2. Apply for FIRB promptly. Don’t wait for approval to become urgent.

  3. Register with the SRO. Don’t overlook land tax and FPAD duties.

  4. Talk to a conveyancer. We make sure everything from due diligence to FIRB conditions is handled correctly.

The Future of Foreign Investment in Australia

The rules are tightening. The 1 April 2025 changes show that the Australian Government is trying to ease pressure on housing availability. More restrictions are possible in the future, particularly if property prices continue to rise and local buyers struggle to compete.

The Department of Treasury and FIRB have both flagged ongoing reviews of how foreign ownership impacts housing affordability. Staying informed is not optional anymore—it’s essential.

Final Thoughts

Foreigners can still buy property in Australia, but it’s no longer as simple as it once was. Between FIRB, tax surcharges, lending restrictions, and new policy changes, getting advice is more important than ever.

At Victorian Property Settlements, we specialise in conveyancing for foreign and local clients alike. If you’re looking for a straight-talking, fact-based approach to buying property in Victoria, call us first. We’ll make sure nothing is missed.

Contact:

David Dawn
Licensed Conveyancer
Victorian Property Settlements
📞 03 9783 0111
📧 david@quick32.com

This article is general information only and is not legal advice. For personalised guidance, speak with a licensed professional.