The Federal Government has announced changes to foreign investment rules for residential housing which basically takes things back to where they were pre 2008. That is, many of the exceptions to FIRB applications have now been removed so that even Temporary Residents seeking a home loan and  purchasing property in Australia to live in (which was an exception) will fall within the regime and an FIRB application will need to be made.

Temporary residents that are looking to move into the property though should not be concerned. Whilst its an extra hurdle with a few extra forms the fact is that the government does not generally oppose such purchases so FIRB approval should just be a technicality. The new rules however will require that temporary residents sell the property when they leave Australia (presuming of course they are still temporary residents and have not been given permanent residency or citizenship). All of my clients thus far have always been temporary residents whose intention was to make Australia their home so the requirement to sell on leaving I dont expect to be an issue.

It is important though that any contract for purchase is now signed "subject to Foreign Investment Review Board approval". This can be frustrating when it comes to a negotiation point of view. If the seller has another buyer at the same price without this condition then the likelihood is they will go with that other buyer.

The FIRB website has yet to be updated fully so the exact details are not available. This blog is all based on my discussions this morning with the FIRB and I will continue to provide updates as more information is provided.

To summarise, whilst this is an inconvenient step introduced by the government it is still business as usual. Any questions do not hesitate.