How Can Foreign Investors Buy Property in Australia? Rules & Restrictions Explained

Australia remains an attractive destination for international investors due to its stable economy, legal system, and strong property market. However, if you’re a foreign national looking to invest in Australian real estate, it’s essential to understand the rules — especially with new restrictions taking effect from April 2025.

Can Foreign Investors Buy Property in Australia?

Yes, foreign investors can buy property in Australia — but there are strict rules in place. Approval from the Foreign Investment Review Board (FIRB) is mandatory before purchasing residential real estate, and the types of properties that can be purchased are limited.

Important Update: Temporary Ban on Established Property Purchases

The Australian Government has announced a temporary ban on the purchase of established residential properties by foreign investors, starting 1 April 2025 and lasting for two years. This measure aims to improve housing affordability and increase availability for Australian residents.

What Types of Properties Can Foreign Investors Buy?

Under current FIRB rules (as of March 2025), foreign investors can generally purchase the following:

• New developments and off-the-plan properties – These are actively encouraged to support housing supply.

• Vacant land – Must be developed into new housing within a specific timeframe (typically within four years).

• Established dwellings – Only allowed under limited conditions, such as:

  • If you’re a temporary resident buying one home to live in during your stay.

  • If you’re redeveloping the property to increase housing stock (e.g., replacing one house with multiple dwellings).

From 1 April 2025:
Purchasing established dwellings will be banned for foreign investors (excluding temporary residents buying to live in), and this rule will remain in effect for two years.

FIRB Approval Process and Fees

To purchase property, foreign investors must:

• Apply for approval via the FIRB website.

• Pay an application fee based on the property’s value.

• Await FIRB’s decision — processing generally takes a few weeks, but longer for complex cases.

Restrictions and Key Considerations for Foreign Buyers

• Cannot buy established homes for investment – Only allowed for redevelopment or temporary residence (and soon to be fully restricted).

• Multiple new properties may be allowed, particularly off-the-plan apartments.

• Stamp duty surcharges apply – Most states charge an additional 7%–8% for foreign buyers.

• Temporary residents must sell their property when they leave Australia permanently.

Tax and Financial Considerations

Foreign investors must also consider ongoing tax and compliance responsibilities:

• Capital Gains Tax (CGT): Foreign sellers pay CGT on gains but don’t receive the 50% CGT discount available to residents.

• Land tax surcharges: Additional charges may apply depending on the state.

• Rental income: Any income earned from the property is taxable in Australia and may need to be reported in your home country.

Can Foreigners Get a Mortgage in Australia?

Yes — but borrowing is more complex.

• Higher deposits are usually required (30–40%).

• Foreign income is assessed conservatively and may be discounted.

• Fewer lenders are available, so finding finance may take more time.

Solution: Work with a mortgage broker who has experience with international clients and understands FIRB and lending rules.

Should Foreign Investors Consider Buying Property in Australia?

Despite these restrictions, Australia continues to attract global investors due to:

• Strong long-term capital growth potential.

• Stable political, legal, and financial environment.

• Consistent rental demand in key urban areas.

Final Thoughts

Foreign investment in Australian property remains possible — but the rules are changing. Understanding FIRB restrictions, upcoming bans, and your tax obligations is critical to making a sound investment. With the right strategy and expert guidance, international buyers can still find long-term value in Australia’s property market.

Looking to invest in Australian property as a foreign buyer? Book an investment session with PropVest today.