Tax Hikes for Foreigners Investing in Aussie Homes

Through these changes, the government is estimated to raise about half a billion dollars.

A ‘For Rent’ and a ‘For Sale’ sign is seen in Canberra, Australia on Feb. 27, 2023. AAP Image/Lukas Coch

Foreign investors will be slugged with higher fees and steeper penalties for buying existing homes and leaving them empty as the government aims to address housing affordability.

The federal government on Sunday announced new rules tripling taxes for foreigners who buy existing houses in Australia and a doubling in fees for those who leave dwellings vacant.

Through these changes, the government is estimated to raise about half a billion dollars.

The new rules would also encourage foreign buyers to invest in new housing developments and encourage them to make their unused properties available to renters, Treasurer Jim Chalmers said.

“It’s about boosting housing stock and getting more homes onto the rental market,” he told Sky News on Sunday.

“It recognises that the rules are already pretty tight, but we want to make them tighter.”

Foreign nationals are usually barred from buying existing property but can do so in limited circumstances such as working or studying.

They are required to sell the property once they leave the country if they have not become a permanent resident.

The government will, at the same time, encourage foreigners to invest in build-to-rent projects by cutting application fee costs to the lowest commercial level.