Often meet clients ask, that is, I am an overseas person I can buy Australian real estate, the answer is yes, yes. But you need to apply for an FIRB file. So what's FIRB? let's talk about FIRB.
What does the FIRB Foreign Investment Review Committee do?
I find that Chinese customers are no stranger to the word FIRB, at least as we all know that FIRB refers to the Foreign Investment Review Board Foreign Investment Review Committee.
The main purpose of the Australian Government's establishment of this review committee is to protect Australia's national interests. On the one hand, the Australian Government welcomes foreign investment to help Australia's economic development and the employment opportunities created. And to provide momentum for Australia's economic development; On the one hand, it is important to ensure that hot money for foreign investment does not fuel property prices so that locals cannot afford to buy housing, or otherwise harm the national interest.
FIRB has regulations for agriculture, commercial property, business, etc., to ensure that super-large acquisitions are vetted. However, the focus of this article is only to discuss residential property.
The intention of the FIRB is to increase the supply of new houses in Australia by opening up foreign investment, so as to improve the supply of new homes that are in short supply, so that Australians can rent and live in houses. FIRB does not want to open up foreign investment in second-hand properties. Because that will only cause the price of second-hand property to be fired, so that local people can not afford to buy the government.
In fact, many Australians themselves do not have a clear idea of FIRB's policy. At the end of last year, an old Australian couple who lived opposite my house came to me to consult me about selling their investment property. They just asked me if I could sell one of their townhouses to Chinese investors at a high price for them. I told them there was no way. The government stipulated that foreigners could only buy new houses, and their property had been completed for four years. They can only be sold to local people who know the market.
The look of dismay I remember now, the old lady uttered, "Why is the government doing this?" Don't let us make money? " I also want to explain to them, this is to make Australian people can afford a house! It could be seen that the old lady was very dissatisfied.
But the policy is often double-edged, when the Australians do not want the Chinese to come to the house with them, when selling, I would like to see a Chinese buyer at the auction venue to grab a card!
Every time the Australian government changed its foreign investment policy, I noticed a sign that the media would first vigorously report news that some Chinese had snapped up prices in Australia to guide domestic public opinion. Get people to support government reforms to limit foreign investment, and then jump out of the way to change policy.
When Prime Minister Rudd originally relaxed the FIRB policy and then tightened the policy, the media desperately reported that some time ago, when a young girl of so-and-so Chinese went out for a dog, she bought a multimillion-dollar mansion. Let the people in Australia think they can't afford to buy a house is the harm of the Chinese, clap hands for government reform! The same is true when the value-added tax reduction is cancelled from foreigners later, and the media pioneers every time before the policy is introduced, when the FIRB application fee is charged to foreigners.
There must be a lot of Chinese people complacent, on the WeChat news, what is "Australia soon to be bought by Chinese!" Another gentleman, when interviewed on television, said proudly that no Chinese, Australia, would die!
There are a lot of pictures on the Internet, all of which are covered by the five-star flag of China. A bunch of Chinese people are pleased, but what does it look like in the eyes of Australians? Then the government can jump out of the high-profile reform, increase public support, but also increase government revenue. However, foreigners do not have the right to vote, does not affect the foundation of governance.
FIRB's definition of foreigners
Sometimes we Chinese are still used to calling white people "old crooked" in Australia. In fact, FIRB has helped us explain who is "old crooked"!
An individual not ordinarily resident in Australia; Or an individual who does not normally have the right of abode in Australia. What does it mean to have the right of abode in Australia? there is also a definition of FIRB. In addition to Australian citizens, this person who has the right of abode must have lived in Australia for more than 200 days in the past 12 months. And there are no restrictions on how long to stay in Australia. This means that permanent residents with permanent PR status in Australia will be able to invest in unrestricted purchases of second-hand properties after 200 days of living in Australia;
A corporation in which anindividual not ordinarily resident in Australia, aforeign corporation or aforeign government holds a substantial interest; Or A company in which foreigners or companies have considerable interests, which means that if a company's shareholders have foreigners or foreign companies holding more than 20% of its shares, the company is a foreign company;
A corporation in which 2 or morepersons, each of whom is an individual not ordinarily resident in Australia, aforeign corporation ora foreign government, hold an aggregate substantialinterest; or is a foreign company if two or more foreign shareholders add up to more than 40%;
the trustee of a trust in which an individual not ordinarily residentin Australia, a foreign corporation or a foreign government holds a substantialinterest ; or
The trustee of a trustin which 2 or more persons, each of whom is an individual not ordinarilyresident in Australia, a foreign corporation ora foreign government, hold anaggregate substantial interest; The same is true of the or family trust or unit trust, as long as the fiduciary has a foreigner or a foreign individual who owns more than 20% of the shares or more than one foreign individual and an individual owns more than 40% of the shares, it is a foreigner's trust;
A foreign government;or Foreign goverment
Any other person, or any other person thatmeets the conditions, prescribed by the regulations. There is also any other subject of this legal limitation, Note: In certain circumstances, an associate of a foreign person may betaken to be a foreign person even if the associate is not a foreign person (seeSubsection 54 (7) of the Foreign Acquisitions and Takeovers Act 2015). In addition, the foreigner's Associate (agent, partner, representative) may in some cases be considered a foreigner, even if the Associate is not itself a foreigner. This also means that if the Australian goverment is hard to check, the use of Australian citizens, relatives and friends of the head of investment in Australia may also be liquidated! So what are New Zealanders? New Zealand citizens can be treated as Australian permanent residents PR, but New Zealand permanent residents are still foreigners! There are no restrictions on the purchase of residential properties in Australia by:
- Australian citizens (even if they don't usually live in Australia)
- Citizens of New Zealand (New Zealand is like a province in Australia anyway)
- Australian permanent resident (New Zealand permanent resident restricted)
- Foreigners can purchase residential property with Australian citizen spouse, New Zealand citizen spouse and Australian permanent residence spouse in the form of joint common (Joint Tenants), but it will be restricted if they buy by joint public (Tenants in common). What kind of residential property can foreigners buy? As mentioned earlier, the Australian Government actually welcomes the residential sector of the foreign investment sector. Foreigners are exempted from applying for FIRB approval to purchase residential properties under the following circumstances:
- Purchase of brand-new residential property from the developer, who has obtained the "new dwelling exemptioncertificate (New Residential Application-free Certificate" to sell the residential property on the project to overseas people;
- Time share time share the transit room, while the proportion of foreign buyers shall not exceed one year;
- The alien acquires the residential property by reason of inheritance or legal decision;
- Residential property purchased from goverment, goverment, Federal State of goverment, or wholly owned by individuals at all levels of goverment, Australia;
- A residential property purchased from a comprehensive sightseeing resort. (for example: Shenxian Bay on the Gold Coast)
So basically, in addition to these circumstances, foreigners can't buy residential property, or else they have to apply.
In general, foreigners are not allowed to buy second-hand residential property (Established Dwelling). What does a second-hand residential business mean? FIRB explains that "it's either a new residential property or it's called a second-hand one."
Temporary visa residents can buy a second-hand residential business as a home in Australia, but they have to be truly self-occupied, must not rent any part of it, and therefore cannot rent an empty room. When buying a second-hand house, make sure that the tenant has moved away by the time the house is handed over, and that no tenant will be allowed to live in it.
Temporary visa residents will have to sell the property within three months if they no longer regard the property as their own home, such as leaving Australia. Temporary visa residents need to hold a visa that can last more than 12 months in Australia to qualify as a temporary visa, excluding a 10-year multiple-entry tourist visa.
Foreigners and temporary residents are not allowed to buy second-hand properties as investment properties or rent or as holiday villas. Foreign companies are generally not allowed to buy second-hand property unless the company does have a significant business in Australia and can buy second-hand housing to serve as an Australian employee's hostel.
Foreigners can apply to FIRB for new housing investments, which are usually approved unconditionally by FIRB.
A new residential property is defined as being built on residential land, being built and about to be built, which has never been inhabited in the past, or is a developer's development, and has never been inhabited for more than 12 months.
The second-hand property is renovated or expanded and renovated by the seller and will not make it a brand-new property.
Bulldozing one or more old residential properties and building a brand-new property will not be seen as a new house by FIRB. Because this land has also lived, Australia's goverment foreign investment policy is to increase the supply of Australian housing, knock down one house and build another house does not increase; Some Melbourne developers knocked out a few houses and built a luxury house, also did not increase the supply of housing, so not originally! This rule existed a few years ago in the original law, but someone just wanted to exploit the loophole.
If it can be proved that the second-hand property you want to buy is broken enough to live, and you buy it and knock it off, it is tantamount to turning an uninhabitable residential property into a habitable residential property, that is, from nothing to nothing. The supply of housing has been increased. But what FIRB changed last year is that because it's too hard to define, it's just that no matter how ragged it is, you can't tear down the reconstruction. This is in fact in line with the original legal intent! Melbourne developers, I do not believe that they demolished those old second-hand houses in the past completely unable to live!
If you want to buy a second-hand house to redevelop it, you have to increase the supply of housing, and you must not rent it during the period of purchase and development, and the development must be completed within four years. To build a new house in the open space next to an existing house, the new house must be the same size and value as the existing house and can be sold separately. To buy an old house next to a container house or grandmother house is not counted as an increase in the number of housing supply!
As noted on FIRB's website, foreigners need to apply for open spaces for their homes, and those that used to have them are not. Again, it shows FIRB's attitude.
What will FIRB do in the future?
To be honest, I have a feeling that every time the vast majority of Australians complain that first-time buyers can't afford to buy a house! We need the government to do something! The Australian government needs a scapegoat, and the government does not dare to press down on the housing market, such as abolishing the negative tax deduction policy, abolishing the value-added tax reduction, and so on. Therefore, the media has to let the media guide the public to think that the Chinese people who suffer from the high housing prices will do harm to the Chinese. And then let FIRB out to show that they're doing something.
The Australian government will continue to need foreign capital to invest in the sprawling number of skyscrapers in major cities because these developers cannot meet pre-sale targets or start lending until they go overseas to sell their properties. Developers do not work to provide jobs, can not reduce the unemployment rate. So make sure the project is always there.
I am very worried to say that many of the flats sold abroad now, each of which is very high-end, can only be envied and hated by the locals, because not many people can afford to live. So who are the foreigners who bought these luxury high-rise apartments for sale in the future? A foreigner can't buy a second-hand house? There is no problem with long-term holdings. If you don't have any value-added holdings, you have to get rid of them. These foreign investors can only sell off, cheap local buyers. For the government anyway, no matter what the steady profit, stamp duty license, Qian Jin Australia is to promote the Australian economy.
So we see the more luxurious the building flowers, the higher the price, everything to satisfy the rich overseas like the high-end psychology. Overseas buyers bought these flats as if they were Chinese cabbage, and even bought several of them at a time. I can only hope that these buyers are planning to use these luxury apartments as a palace club, usually do not rent, lock up, a 10-year multiple entry travel visa, you can come to holiday at any time.
In fact, it is wrong for overseas buyers to stir up house prices in Australia so that local Australians cannot afford to buy a house. How many black hair in the news are local people of identity, and the houses that rich Chinese like to snap up are not usually bought by Australians. Either in a particular Chinese area or at a high price. It doesn't affect first-time buyers at all.
In the future, the Australian government should consider opening up foreign buyers and sellers of more than one million luxury homes to attract more foreign tycoons to come to Australia to be friends with us.
In addition, you can also learn from Singapore that foreigners cannot buy second-hand residential properties with land, but apartment buildings are free to be bought and sold by foreigners, which will help the development of the apartment market. Anyway, at the end of the supply oversupply, open immigration is just.
