Foreign purchase of property

With foreign investment playing an important role in the economy, Australia welcomes foreign acquisition of real estate. Section 4 of the Foreign Acquisitions and Takeovers Act 1975 (the Act) defines a foreign person to mean:

  • an individual not ordinarily resident in Australia; or
  • a corporation in which an individual not ordinarily resident in Australia, a foreign corporation or a foreign government holds a substantial interest; or
  • a corporation in which two or more persons, each of whom is an individual not ordinarily resident in Australia, a foreign corporation or a foreign government, hold an aggregate substantial interest; or
  • the trustee of a trust in which an individual not ordinarily resident in Australia, a foreign corporation or a foreign government holds a substantial interest; or
  • the trustee of a trust in which two or more persons, each of whom is an individual not ordinarily resident in Australia, a foreign corporation or a foreign government, hold an aggregate substantial interest; or
  • a foreign government; or
  • any other person, or any other person that meets the conditions, prescribed by the regulations.

However, that is not to say that Australia allows any and every type of investment by foreign purchasers. Foreign ownership is still subject to several restrictions such as those set out in the Act and the Foreign Acquisition and Takeovers Regulations 1989. Non-compliance with Australia’s foreign investment framework may result in strict criminal and civil penalties.

If you want to invest in Australia from overseas, TNS Conveyancing can help you manage complex foreign investment transactions and government approvals.

Our foreign purchase conveyancing services cover:

The Foreign Investment Review Board requires foreign buyers to secure its approval before taking interest in an Australian residential property and entering into an unconditional contract of sale. The most common types of residential property that require FIRB approval are new dwellings, vacant land with a view to build, and new apartments.

TNS Conveyancing can assess whether you are obliged to seek FIRB approval. We can guide you through the approval process and give further legal advice about your property purchase to minimise the risk of heavy penalties.

With a dwelling exemption certificate, foreign purchasers do not need to secure individual FIRB approvals for the Australian property covered by the certificate. However, the exemption certificate only applies for purchases up to $3 million in a single development; otherwise, an individual FIRB approval will be required.

Similar to FIRB approval, applications for a new or near-new exemption certificate are considered on a case-by-case basis. Should you be eligible, our conveyancers can assist you with completing and submitting your applications to the Australian Taxation Office.

From the term itself, an unconditional contract is one that has no conditions attached to the sale. This means that once the contract is signed, both parties are legally obliged to follow through with the sale. Fair warning: entering into an unconditional contract may speed up the property sale but it carries a higher level of risk.

Foreign persons must not enter into unconditional contracts of sale prior to receiving FIRB approval. Otherwise, they may be liable for hefty penalties (civil and criminal) for failing to comply with our foreign investment rules. Our conveyancing team can review your contract of sale and make sure you don’t lock yourself into an unfavourable agreement.

Foreign persons can also enter an option agreement to buy or sell interest in a property within a specific period and on certain terms and conditions. The agreement may include a call option, put option or put and call option. With a call option, the prospective buyer can acquire the property by requiring the developer or owner to sell it. Meanwhile, a put option lets the property owner require a buyer to proceed with the purchase. Option agreements may also require FIRB approvals.

TNS Conveyancing can draft option agreements and facilitate negotiations to ensure that the terms and conditions meet each party’s requirements. We can also help you work out a plan of action for any contingencies that could arise between signing the option agreement and completing the foreign purchase of property.

Foreign persons may also acquire an interest in a property through lodging a caveat or mortgage. Be careful as this may also trigger FIRB issues and you may potentially also need FIRB approval prior to holding a security interest over a property.

Doing due diligence is even more important when buying real estate in a foreign country. The more you know about the property, the smarter your decisions will be at any point of the conveyancing. Contract review is just one of the many parts of the due diligence process. We can assist in investigating and assessing the advantages and potential risks of every legal and financial aspect of your real estate purchase.

Take advantage of our highly personalised and cost-effective conveyancing services. For legal advice and assistance in foreign purchase of property in Victoria, get in touch with our conveyancers by calling +613 9959 9850 or email us at info@tnsconveyancing.com.au.

Complete cost transparency

All conveyancing fees and charges are provided upfront and in writing. We give you exactly what is and is not included.

How it works

Enquire

Request a free, no-obligation callback and one of our conveyancers will get back to you within 24 hours. Tell us what’s going on with your conveyancing transaction so we can assess your situation and give you a no-obligation quote.

Correspond

If you decide to proceed with us, we will contact you straight away. We will ask for some money in trust and moving forward, our conveyancing team will keep in touch via email and phone throughout the process.

Review

At the end of every transaction, we will ask you whether we have met the high-level conveyancing service you deserve, the same standards to which we aspire. If not, we will work with you to address any shortcomings immediately.

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