Foreign home-owners ordered to sell up

The Federal Government has ordered foreign nationals to sell another 16 illegally purchased residential properties across the country.

It brings the total number of properties ordered to be sold as part of the crackdown on illegal foreign ownership to 43, two of which are in Perth.

The properties have a combined value of more than $92 million.

The Perth properties, in Langford and Ardross, were owned by Chinese and Indonesian investors respectively.

Real Estate Institute of Australia president Neville Sanders said Australia’s foreign ownership system was reasonably balanced.

“What we’ve seen recently is where there’s been more scrutiny of compliance,” he said.

“In recent years – up to about 12 months or so ago – there hadn’t been sufficient effort in compliance.

“The Real Estate Institute of Australia supports the government ensuring that there is compliance with its laws and regulations.”

Mr Sanders said most foreign property investors complied, but the government’s crackdown sent a strong message.

Gunning Real Estate principle Malcolm Gunning said most cases were caused by naivety or bad advice.

“Chinese don’t deliberately go out and look to break the law,” he said.

“What’s happened over the past few years with the flurry of investment is that a lot of those investors have had bad advice.”

Mr Gunning said there was negative press in the Chinese media following the crackdown.

“When we were clamping down, there was a lot of negative press about Chinese investment, that made front pages of a lot of dailies [newspapers] over there,” he said.

“If you’re going to make it difficult for foreign investors to buy off-the-plan home units, it will have a direct impact on the construction industry.”

The Australian Taxation Office has been responsible for enforcing regulations applying to foreign nationals purchasing Australian dwellings since 2015.

Australia’s foreign investment framework requires foreign nationals to apply for approval from the Federal Government before purchasing residential real estate.

According to the Foreign Investment Review Board’s website, non-resident foreign nationals generally cannot purchase established residential properties in Australia.