FIRB issued just 17 divestment orders to foreign buyers over past decade
The Foreign Investment Review Board (FIRB) has issued just the 17 orders for foreign investors to divest illegally acquired property in Australia since 2003, data obtained by Kelly O'Dwyer's parliamentary committee has revealed.
The FIRB had failed to prosecute a single matter since 2006 for illegally acquiring property in Australia.
The lack of divesture orders has been a cause for criticism of the FIRB to monitor the investment rules.
Some of its divestment orders have related to the failure of the overseas buyer from developing the property within the designated time. There was one known case on the Gold Coast.
The Cubbie Station sale was approved with divestiture orders requiring the buyers to seek partners by 2015.
Property Observer has reported two Sydney cases where purchases have been stopped from proceeding, in Strathfield and Bellevue Hill.
Australia allows foreign investment in new housing to stimulate supply, but prohibits foreigners from buying fixed homes in all but a narrow range of circumstances.
New rules mean temporary residents must dispose of property they have bought within three months of departing Australia.
The House of Representatives economics committee’s inquiry has heard evidence that the rules are being flouted, with foreigners happy to take the risk of not being caught.
The Australian reports the committee is poised to recommend that foreign investors pay a fee to apply for permission to purchase real estate in Australia.
It is also likely to recommend changes to data-collection policies to ensure the nationality of buyers is recorded and fines for those local agents, lawyers and accountants who assist in illegal purchasing.
O’Dwyer has flagged considering stamp duties to be imposed on foreign buyers to cool the money flow from China into Australian residential property markets.