Frequently asked questions
1
Can foreigners buy property in Australia?
Yes. Foreign investors can buy property in Australia and it is supported by the government. Australia is a multicultural country and welcomes overseas investors. Both new residential properties and commercial properties can be purchased by foreigners as long as you comply with all the Foreign Investment Review Board (FIRB) requirements and any other government regulations specific to foreign investment.
2
What is the Foreign Investment Review Board?
The Foreign Investment Review Board (FIRB) is an Australian government advisory body that reviews foreign investments in Australia. It checks if purchases by people from other countries match national laws and interests.
Foreign investors can purchase new residential property with FIRB approval. Developed commercial property may not require FIRB approval depending on the purchaser and property type.
As part of the purchase process, you need to apply for FIRB approval and pay an application fee. We recommend seeking legal advice to ensure your acquisition is compliant with FIRB requirements.
3
Can you help us through the process? What services do you offer?
Yes, we can help you the entire way through the process. We provide as much—or as little—assistance as you require.
During our onboarding process, we'll gain an understanding of your property requirements and the assistance you will require.
We will provide the services as detailed in our agreement. This can include sourcing properties in line with your requirements, negotiating with sellers on your behalf, preparation of contract and execution, right through to property settlement, and picking up the keys.
We can also agree to source and assist you to engage all other professional services required to achieve your property goals in Australia. For example:
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Property Lawyer
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Finance Broker
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Accountants and Tax advisors
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Banks
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Immigration Lawyer
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Property Managers.
4
Is it safe to invest in off-plan properties in Australia?
An off-plan property is real estate you buy before construction is finished, or even before it starts. You make your choice using architectural blueprints, 3D designs, and developer plans instead of walking through a real building. Your deposit is protected and refundable if the project isn’t completed, helping provide peace of mind to buyers purchasing off-plan.
The Australian government regulates the real estate industry rigorously. There are strong laws protecting consumer rights, to protect against property developments failing to be completed and leaving the purchaser exposed.
Further, Australia has high building standards, and the building industry is highly regulated. The builder or developer is responsible for any major building defects for approximately 7 years after the project has been completed.
5
Do I need to pay Australian tax?
Yes. Foreign investors typically need to:
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obtain a Tax File Number (TFN)
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lodge annual Australian tax returns
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declare rental income
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pay Capital Gains Tax (where applicable)
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comply with Australian Tax Office reporting requirements.
All foreign investors must seek independent taxation and financial advice.
6
Do I need an Australian bank account?
Typically, yes, to receive rental income, pay expenses and meet taxation obligations. It also helps simplify the purchasing process, as well as property management services, should you require them.
7
Why have I received an email asking questions about my identification, source of funds or how my wealth was achieved?
Australia now has strict anti-money laundering and counter terrorism financing laws (AML/CTF Laws). We are required to validate your identity and complete a background check prior to commencing any work with you. It is unlawful for us to work with you until this step is complete.
AML Partners are our nominated external AML/CTF provider. They assist us by undertaking all the required background checks and identity verification processes for us.
8
Do I need to answer the questions asked by the external AML/CTF provider?
Yes. If you do not provide responses to the questions asked, we will not be able to assist you. It is important you answer all questions truthfully and accurately.
9
I’ve answered all the questions asked by the external AML/CTF provider. When can we start looking for a property?
Your responses first need to be reviewed and a clearance issued. Usually this takes about two weeks, but it can take longer. Only after the review has been completed and a clearance granted can we commence your property journey in Australia.
10
After I buy a property I want to lease it. Is that allowed and can you help me? How do I collect the rent?
Yes, you can lease the property. The FIRB requirements encourage this. For foreign investors there are laws and annual reporting obligations around how long the property is available for lease each year.
Australia has strong regulations around renting properties to help protect both the renter and the property owner’s rights. We can help you source a property manager to manage the property for you.
If you have an Australian bank account your property manager will ensure your rent is paid into your bank account. Property Managers generally charge 8% to 10% of the rent as their service fee.
11
If I buy a property and I want to lease it, do I need to furnish it for my tenants?
No, you don’t have to furnish it. In Australia it is typical to rent residences vacant.
A small amount of people rent residences furnished but your Property Manager can advise you if they think it is worthwhile.
12
Who looks after the common area in a building in Australia? Who pays for large building repairs if they are required as the property ages?
Most buildings will have a body corporate established, and you pay a fee each year. This is paid by each unit owner and contributes to the maintenance and cleaning costs of common areas, as well as insurance.
Part of the fee goes into a fund for future repairs and renovation costs. This helps protect against owners receiving any large, unexpected repair costs in the future.
Important: This is a general overview. Requirements vary according to the client, country, ownership structure, property type and risk profile. Pride Property Consulting does not provide legal, tax, finance, immigration or foreign investment advice.
