Regional Living Australia

About Foreign Investment in Australian Real Estate

Regional Living Australia

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About Regional Living Australia

The Regional Living Australia website was established by the Ndarala Group as a service to all those interested in regional Australia whether for investment, life work or play.

Founded in April 1996, Ndarala’s mission is to help management related independent professional practices and professionals achieve their business and professional objectives through cooperation while retaining true business and professional independence. Further information about the services we offer to members and clients can be obtained from the Group’s web site, www.ndarala.com.

Ndarala and its members have had a long involvement with regional Australia.

Foreign Investment in Australian Real Estate

Many overseas people share the Australian dream of acquiring their own piece of dirt in Regional Australia. However, foreign investment in Australian real estate is still a politically sensitive issue and there are some restrictions.

This page provides initial information as to what is possible. The regulations are reasonably complex and are also subject to change. For that reason, all those interested are advised to consult the Foreign Investment Review Board (FIRB) web site for further information and then to contact the Board with specific queries. Full contact details are set out below.

The first key point is that residential real estate acquisitions – direct or indirect – by foreign persons require Government approval. You need to get this approval in advance of purchase. There are some exemptions, New Zealand citizens for example, but these should be checked on an individual basis.

The second key point is that the key policy objective for foreign investment in residential real estate is to increase the housing stock. Consistent with this and with certain limited exceptions, acquisition of existing residential properties by non-resident foreign citizens is not allowed. This may sound harsh, but it does allow you, subject to approval, to:

  • acquire new home units, townhouses, house and land packages where construction has commenced, starte titled hotel/motel units in a new development
  • vacant land so long as development occurs within a specfied period. Properties developed under this clause may be rented out, sold or retained for the foreign investor’s own use.

There is a very real shortage of rental accommodation in many parts of Regional Australia, so the vacant land clause is potentially important from an investment perspective. We recommend that you check with local economic development officers in reviewing opportunities.

Turning now to primary production. The rules here are a lot easier where agri-businesses are concerned. Hobby farms count as urban real estate for the purposes of policy and are covered by the rules just discussed.

Foreign interests do not  require prior foreign investment approval to acquire a business carrying on primary production where:

  • the total assets of the business are less than $A50 million or, because of the US Australia Free Trade Agreement,  $A831 million for a US investor; and
  • more than 50 per cent of the total assets is attributable to Australian Rural Land’.

The effect is to allow overseas people to acquire Australian farming properties.

Similar rules apply to the acquisition of commercial real estate.

FIRB contact details can be found at the Regional Living Australia website.

 



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