Due to its proximity to Singapore, high quality education institutes and booming property market, Investing in Australian property has long been a popular for Singaporean investors. But what properties can Singaporeans buy? And what are the rule regarding their purchase?
Restrictions on Australian Property Ownership
Singaporeans (as well as other ‘foreigners’) are restricted from purchasing existing or ‘second hand’ properties in Australia. However, foreign buyers are able to purchase new build property, subject to Foreigner Investment Review Board (FIRB) approval.
The Foreign Investment Review Board assesses applications from foreigners who wish to purchase property in Australia. With particular regard to new dwellings, foreigner buyers generally need to apply to receive approval before purchasing their property, but the FIRB website states “Applications to purchase new dwellings are usually approved without conditions”.
On the FIRB website, a new dwelling is defined as:
A dwelling that will be, is being or has been built on residential land, has not been previously sold as a dwelling and has either:
- Not been previously occupied or
- If the dwelling is part of a development, was sold by the developer of that development and has not been occupied for more than 12 months in total”.
The fees for applying for FIRB approval vary depending on the property price:
|Purchase Price||FIRB Fee|
|$1 million or less||$5,700|
|$1,000,000 to $1,999,999||$11,500|
|$2,000,000 to $2,999,999||$23,100|
|$3,000,000 to $3,999,999||$34,600|
|$4,000,000 to $4,999,999||$46,200|
|$5,000,000 to $5,999,999||$57,700|
|$6,000,000 to $6,999,999||$69,300|
|$7,000,000 to $7,999,999||$80,900|
|$8,000,000 to $8,999,999||$92,600|
|$9,000,000 to $9,999,999||$104,100|
|$10,000,000 or higher||Subject to specific amount of purchase price,|
However, in circumstances where a developer holds a new dwelling exemption certificate. The developer can sell dwellings in a specified development to a foreign person and the foreign buyer and does not require an individual FIRB approval to purchase.
New Dwelling Exemption Certificate
Developers may apply for a New Dwelling Exemption Certificate if a development meets the following criteria:
- it consists of 50 or more dwellings
- has development approval from the relevant government authority; and
- if applicable, that foreign investment approval was sought to purchase the land and that any conditions are being met.
Where a developer holds a New Dwelling Exemption certificate, only 50% of the apartments in the building can be sold to foreign buyers. If the 50% quota is reached, any additional foreign buyer would then require approval from FIRB on an individual basis.
Sales contracts will differ between those with pre-approved New Dwelling Exemption Certificates and for those buyers obtaining their own FIRB approval. For those seeking their own FIRB approval, sales contracts should be ‘Subject to FIRB approval’.
Any breaches of the FIRB rules and requirements can result in criminal prosecution.
Certain purchasers may not require foreign investment approval before purchasing residential real estate in Australia. This includes:
- an Australian citizen (regardless of whether they are ordinarily resident in Australia or not)
- a New Zealand citizen
- the holder of an Australian permanent visa; or
- foreign persons purchasing property as joint tenants with their Australian citizen spouse, New Zealand citizen spouse, or Australian permanent resident spouse.
Buyer’s Guide for Investing in Australian Property
We’ve written a detailed Buyer’s Guide to Australia, specifically for foreign investors looking to buy invest in Australia. Download our guide here for our step by step guide with everything you need to know about investing in Australian property.
Important notice: Proptech Pioneer and its associated companies seek to provide real estate investors with guides, information and tools, but we cannot guarantee this information to be accurate or perfect. You use the information at your own risk and accept no liability if you rely on this information. Proptech Pioneer is not a tax advisor, accountant conveyancer, lawyer, financial advisor or mortgage advisor. You should seek independent advice from independent professionals before making any investment decision.