Investing in overseas property? Here’s our essential guide to comparing the purchase costs in Australia, New Zealand and England.

You’ll most likely be aware that the purchase costs and taxes associated with investing in overseas property varies widely between countries.  You’ll find detailed information about this in our Buyers Guides and other articles, but in this blog, we set out some examples so you can compare the three countries side by side. 

Purchase Costs Comparison

 AustraliaNew ZealandEngland
Legal FeesBetween $750 and $1,500 depending on property and state. Between $750 and $1,500 depending on property and state.   £1,950 to £2,750 plus VAT and disbursements depending on property.
Stamp Duty Progressive tax regime based on purchase priceNilProgressive tax regime based on purchase price.
First Home Buyer GrantsYesNoYes
Surcharge for Investor and Second Home BuyersNoNo3%
Surcharge on Non-Resident BuyerYes (depending on state, up to 8%)No2% 
Transfer ChargesVaries depending on state and purchase price. $176 Between £190 and £910 depending on purchase price.

To help put this into context we compare the cost of purchasing in each country based on purchase prices in USD, assuming you are an offshore investor.

 Australia
(ACT)
Australia
(NSW)
New Zealand
United Kingdom
(England)
 FX Rate USD =
0.74
FX Rate USD =
0.74
FX Rate USD =
0.70
FX Rate USD =
1.38
USD 500,000AUD 680,000AUD 680,000NZD716,000£360,000
Stamp Duty*USD 14,606USD 59,5700USD 36,252
     
USD 1,000,000AUD 1,360,000AUD 1,360,000NZD1,432,000£720,000
Stamp Duty*USD 44,808USD 124,6600USD 88,605
     
USD 1,500,000AUD 2,040,000AUD2,040,000NZD2,148,000£1,080,000
Stamp Duty *USD 68,951USD 192,5920USD 147,190
* Stamp Duty Costs also include Land Registration Fee, Mortgage Registration and Transfer fees

To see the differential at different price points the chart below shows the cost of Stamp Duty in Australia (ACT and NSW), New Zealand and England and Northern Ireland, at different purchase prices between USD 500,000 and USD 1,500,000.


 

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It’s obvious from the above that New Zealand as the lowest costs at the point of purchase.  But the performance of your investment is also determined by a raft of other factors including how expenses are treated, income tax, management fees, finance costs and rental income to name a few. You may find our recent article on how to compare investment properties in Australia, New Zealand and the UK useful. You can read more here.

Investing in overseas property

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Whilst the costs and taxes at the time of purchase are important, they are not the only driver that will determine the performance of your overseas property.

For investors it’s incredibly difficult to map these variables in any meaningful way, particularly across different countries meaning it’s very difficult to compare the likely performance of different properties, after tax.

To help investors do just that, we are about to launch the Du Val PropTech platform – designed for investors to enable you to forecast and compare the performance of properties across multiple countries. If you’re investing in overseas property, don’t miss it! Sign up to here more [email protected]

We hope you have found this article useful, feel free to comment or ask any questions.  For more information on about property investment check out our other articles and request your copy of our Buyers Guides from [email protected]

Important notice:  Proptech Pioneer and its associated companies seeks to provide 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.