Amendments to the Foreign Acquisitions and Takeovers Regulations 1989, have now removed the exemption that previously applied to temporary residents purchasing residential real estate in Australia. This amendment means that temporary residents of Australia will now need to apply for approval before buying any Australian real estate.

Temporary residents will now need to apply for approval from the Foreign Investment Review Board (FIRB) before acquiring real estate in Australia.  Note that ‘temporary residents’ of Australia include only those visa holders who are living in Australia where the temporary visa allows the holder to stay in Australia for a continuous period of more than 12 months.

Approvals to purchase residential real estate in Australia will be subject to a condition that the dwelling is sold when it ceases to be the temporary visa holder’s principal place of residence.

Exemptions:

There are certain exemptions to these amendments, where the acquisition of residential real estate in Australia does not require notification to or approval from the FIRB under the Foreign Acquisitions and Takeovers Regulations 1989.

Temporary residents should seek specific legal advice regarding exemptions, however, generally you do not need to apply for approval to purchase Australian real estate if;

• you are an Australian citizen living overseas;
• your legal spouse is an Australian citizen and you are acquiring real estate in both your names as joint tenants;
• you are a New Zealand resident purchasing Australian residential property;
• you hold an Australian permanent resident visa and are purchasing residential property;
• you are purchasing a new dwelling(s) from a property developer who has pre-approval to sell those dwellings to foreign persons;
• you are purchasing a ‘time share’ interest in a property which does not permit you or any of your associates to reside there for more then 4 weeks per year;
• you are purchasing Australian residential real estate in an Integrated Tourism Resort (ITR);
• you are purchasing an interest in developed commercial Australian property valued at less the $50 million (or $1004 million indexed annually) for U.S investors, or $5 million on heritage listed real estates where the purchaser is not a U.S investor;
• you are purchasing an interest in Australian commercial property which has been developed and is to be used immediately for industrial or non-residential commercial purposes, and where the purchase is not significant to the purchasers business activities;
• you are purchasing an interest by will or some other operation of law (eg – court orders concerning division or property in a divorce settlement) which is legal and binding;

• you are purchasing Australian real estate from the Government (including Commonwealth, State or Territory or Local Government Authorities).

The FIRB advises that they do not notify temporary Australian visa holders of exemptions which may apply to them. It is suggested that persons holding temporary visas should determine individually whether their proposed purchase of real estate is exempt or not and should seek legal advice to clarify this matter.