Buying Property in Australia for Foreigners

Published on November 26, 2025 and written by Cyril Jarnias

Navigating the Australian real estate purchasing process can seem complex, especially for foreigners looking to invest in this dynamic and promising market. Understanding the specific government regulations for non-residents, as well as the administrative procedures to follow, is essential to avoid potential complications. In this article, we’ll guide you through the crucial steps, from key regulatory authorities to tips for maximizing your purchasing opportunities, ensuring a smooth and successful acquisition experience in this country of vast landscapes and innovative cities.

Understanding Regulations and Obligations for Buying in Australia

Main Regulations and Legal Obligations for Foreign Real Estate Purchases in Australia:

• Any acquisition by a foreigner requires prior approval from the Foreign Investment Review Board (FIRB). This step is mandatory for non-residents and most temporary residents.
• Real estate purchases by foreigners are strictly regulated by the Australian Foreign Acquisitions and Takeovers Act of 1975 (FATA).
• Failure to comply with FIRB rules can result in significant financial penalties, or even forced sale of the property.

Summary Table: Foreign Buyer Categories, Permitted Properties, and Restrictions

Buyer Category	Permitted Properties	Main Restrictions
Non-resident	New dwellings, vacant land for building	Prohibited on established homes (existing dwellings) except for exceptions (e.g., Integrated Tourism Resort)
Temporary resident	New dwellings, some established properties	Mandatory sale upon leaving Australia, must be used as primary residence
Foreign company	Commercial real estate	FIRB review, restrictions based on sector and investment size
Permanent resident	No specific restrictions (treated as Australian citizen)	–

Accessible Property Types and Restrictions:

• New dwellings: Accessible to all foreigners, subject to FIRB approval.
• Established dwellings: Generally prohibited for non-residents, except rare exceptions (e.g., certain tourist complexes or special approval).
• Vacant land for building: Accessible if the project involves new construction within a set timeframe.
• Commercial real estate: Subject to FIRB approval, rules vary based on property value and business sector.

FIRB Approvals and Procedures:

• Submit an online application through the official FIRB website.
• Pay a FIRB application fee that varies based on property value (from $4,000 AUD to $150,000 AUD or more in 2025).
• Wait for FIRB approval before any final signing or property transfer.

Additional Taxes and Fees:

• FIRB application fees: Mandatory, non-refundable.
• Stamp Duty: Applicable to all real estate purchases, often with a surcharge for non-residents (Foreign Purchaser Surcharge), with rates and terms varying by Australian state.
• Other fees: Legal fees, property transfer fees, potential vacancy tax for unoccupied properties.

Summary of Key Steps for Foreign Buyers:

• Verify eligibility of desired property (new, land, commercial use…).
• Obtain FIRB pre-approval.
• Sign a sales contract conditional on FIRB approval.
• Pay applicable taxes and duties.
• Finalize the transaction with professional support (lawyer or licensed real estate agent).
• Comply with post-purchase obligations (especially regarding leasing or resale).

Importance of Professional Support:

Real estate acquisition in Australia involves numerous regulatory and tax specifics.

The involvement of a specialized lawyer or licensed real estate agent is essential to:

• Verify transaction compliance.
• Secure contract drafting.
• Optimize taxation and anticipate potential resale or reporting obligations.

Professional support helps avoid financial penalties or disputes, ensuring compliance with local laws at every process step.

Key Takeaway: Any acquisition by a foreigner in Australia requires FIRB authorization, specific taxes, and strict adherence to restrictions on accessible property types. Professional guidance is strongly advised to secure the operation and remain compliant with Australian legislation.

Exploring International Taxation: What Foreign Buyers Need to Know

When acquiring property in Australia, foreign buyers face a series of specific taxes and regulatory procedures. These elements directly impact the total acquisition cost, investment profitability, and administrative obligations to fulfill.

Main Taxes to Consider

Tax	Description	Rates/Examples for Foreigners	Specifics
Stamp Duty	Purchase tax, varies by state and property value	+7% to +8% surcharge in some states	Surcharge for foreign buyers
FIRB Application Fee	Filing fee for foreign purchase approval	$4,000 to $150,000 AUD based on property value	No exemptions
Land Tax	Annual tax on land value	Potential surcharges by state	Surcharge for non-residents
Capital Gains Tax (CGT)	Tax on resale profit	Higher rates for non-residents	No main residence exemption
Goods and Services Tax (GST)	Value-added tax for certain new real estate properties	10% on new constructions	Generally not applicable to established properties

Stamp Duty and Foreigner Surcharges

• Stamp Duty is a mandatory purchase tax, calculated on property value, ranging from 2.5% to over 5% depending on the state.
• Foreign buyers pay an additional surcharge (“Foreign Buyer Surcharge”), typically between 7% and 8% of the property price, on top of standard stamp duty.
• Real example: For a $1 million AUD property in New South Wales, a foreign buyer will pay approximately $40,000 AUD in standard stamp duty + $80,000 AUD surcharge, totaling $120,000 AUD.

Role of the Foreign Investment Review Board (FIRB)

• Any real estate acquisition by a non-resident must be approved by FIRB.
• The process involves an official application with fees ranging from $4,000 AUD (for low-value properties) to $150,000 AUD (for high-value properties).
• FIRB approval is mandatory, with no possible exemptions for foreigners, and must be obtained before finalizing the purchase.

Goods and Services Tax (GST)

GST (10%) applies mainly to purchases of new real estate properties or vacant land for building.

Generally not applicable to established real estate, but it’s essential to verify the property type to avoid budget surprises.

Capital Gains Tax (CGT) Upon Resale

• Non-residents are subject to CGT on the entire capital gain realized upon resale.
• Exemptions for main residences do not apply to foreign investors.
• When selling a property worth over $750,000 AUD, the buyer must withhold and remit 12.5% of the sale price to the tax authority under the “foreign resident capital gains withholding” rule.

Example of Budget Impact

Assume purchase of a new apartment in Melbourne (Victoria) for $1.5 million AUD:

• Standard stamp duty: ~$55,000 AUD
• Foreign buyer surcharge: ~$120,000 AUD (8%)
• FIRB fees: $27,100 AUD (for this price range)
• GST (if applicable, new property): $150,000 AUD (10%)
• Total initial taxes and fees (excluding ancillary fees, excluding land tax): $352,100 AUD

Upon resale, a $300,000 AUD capital gain will generate CGT calculated based on non-resident status, with no holding period discount.

Reporting and Payment Obligations

• Australian Tax File Number (TFN) mandatory for any rental income or capital gains declarations.
• Annual declaration of rental income and capital gains to the ATO (Australian Taxation Office).
• Proof of fund source required by banks and authorities.

International Tax Treaties

• Australia has signed numerous bilateral tax treaties to avoid double taxation of property income and capital gains.
• Depending on the country of tax residence, these treaties may allow a tax credit or partial exemption on taxes paid in Australia.
• It’s crucial to consult the specific tax treaty between Australia and your home country.

Practical Tips to Optimize Your Tax Situation

• Get assistance from a tax specialist in Australian international taxation.
• Check eligibility under tax treaties and anticipate obligations in your home country.
• Plan the acquisition structure (individual, company, trust) based on wealth and succession goals.
• Anticipate resale taxes and plan necessary cash flow for CGT withholding.
• Avoid common pitfalls: lack of FIRB approval, misassessment of surcharges, non-declaration of rental income or capital gains.

Key Takeaway

Acquiring real estate in Australia as a foreigner involves significant tax surcharges, strict administrative procedures, and enhanced reporting obligations. Meticulous preparation and professional support are essential to secure and optimize your investment.

Essential Documents for Acquiring Real Estate in Australia

Essential documents to prepare for real estate purchase in Australia by a foreigner:

Document	Role / Purpose	Notes
Valid passport / National ID	Buyer identity verification	Required for all procedures and signatures
FIRB (Foreign Investment Review Board) Approval	Purchase authorization for non-residents and foreigners	Application must be submitted and obtained before final signing, conditional clause to include in contract
Proof of financing / savings	Justifies purchasing capacity (bank statements, proof of deposit, fund certificates)	Required by banks and authorities
Proof of income / employment	Creditworthiness assessment for loan approval	Employment contracts, pay slips, tax returns
Credit report	Borrower risk assessment	Often requested by banks, if available from home country
Sales contract	Formalizes agreement between seller and buyer, sets conditions and timelines	Must include “subject to FIRB approval” clause
Title Deed	Attests to ownership and legal transfer	Provided upon transaction completion
Tax declarations (direct and indirect)	Tax obligations related to purchase, notably stamp duty and other local taxes	Vary by state/territory

Key Steps and Points of Attention:

Prior verification by a specialized lawyer:

• Essential to validate contract document compliance and transaction legality
• Lawyer ensures presence of all essential clauses (conditional terms, deadlines, FIRB compliance, absence of property encumbrances)
• Verifies local specifics (rules specific to each Australian state/territory)

Meeting deadlines:

• Documents must be submitted within specified timeframes (e.g., FIRB submission and response before sale conclusion)
• Missing these deadlines can lead to sale cancellation or financial penalties

Differences by Australian States or Territories:

State/Territory	Documentary and Tax Specifics
New South Wales (NSW)	Specific stamp duty, cooling-off periods, particular disclosure requirements
Victoria (VIC)	Different tax declarations, disclosure obligations
Queensland (QLD)	Different filing procedures and titles, settlement timelines
Western Australia (WA)	Separate registration system, land ownership specifics

List of Documents to Prepare:

• Valid passport or national ID
• FIRB approval
• Proof of financing (bank statements, fund certificates)
• Proof of income and credit report (if applying for loan)
• Sales contract with appropriate conditional clauses
• Title deed (provided at sale completion)
• Tax declarations and proof of stamp duty payment
• Proof of address
• Australian Tax File Number (TFN) or proof of application (recommended)

Best Practices:

• Always request certified translations if documents are not in English
• Keep digital and physical copies of all submitted documents
• Anticipate response times from authorities (FIRB, banks, lawyers) to plan purchase without rush

Real Estate Ownership in Australia: Can Foreigners Buy?

Real estate purchases by foreigners in Australia are strictly regulated and subject to significant restrictions, particularly since the temporary ban on existing home purchases by non-residents took effect (April 2025 to March 2027).

Main Laws and Regulations

• Real estate purchases by foreigners are governed by the Foreign Acquisitions and Takeovers Act 1975 (FATA), which aims to channel investment toward new housing construction and avoid speculation on existing properties.
• Non-resident foreigners cannot purchase existing residential properties (apartments or houses already built and occupied), except for rare exceptions.
• Since April 2025, this prohibition is total and applies at least until March 2027, under penalty of severe sanctions (fines, imprisonment, profit confiscation).

Role of the Foreign Investment Review Board (FIRB)

• The FIRB is the Australian body responsible for reviewing and approving foreign real estate investment applications.
• Any residential acquisition by a non-resident or temporary resident requires prior application to FIRB.
• The application must be submitted and approved before final purchase deed signing; the contract must contain a conditional clause contingent on this approval.

Property Types Accessible to Foreigners

Property Type	Non-residents	Temporary Residents (visa >12 months)	Permanent Residents
New property	Yes	Yes	Yes
Vacant land (for building)	Yes (with obligation for quick construction)	Yes	Yes
Existing property	No (except exceptions)*	Yes (if primary residence, with obligation to sell after departure)	Yes

*Exceptions: significant property transformation, redevelopment, or special circumstances (rare).

Additional Taxes and Fees for Foreign Investors

• FIRB fees: from $4,000 to $150,000 AUD based on property value.
• Stamp duty surcharge: each state applies a specific surtax for foreigners (averaging 7 to 8%).
• Land Tax Surcharge: some states impose an annual surtax on real estate holdings by foreigners.
• Deposits: foreigners typically must provide a 20% to 30% deposit of purchase price.
• Proof of funds: obligation to demonstrate funds come from buyer’s own resources.

Administrative and Financial Steps

1. Verify eligibility and choose authorized property type.
2. Apply for FIRB approval, pay corresponding fee.
3. Negotiate and sign sales contract, with “Purchase conditional upon FIRB Approval” clause.
4. Pay deposit into an Australian account.
5. Pay stamp duty (and surcharges), finalize financing with bank (loans often more restrictive for foreigners).
6. Finalize property deed (settlement), register transfer with local land administration.

Recent Example

Between April 2025 and March 2027, any purchase of existing residential housing by non-resident foreigners is prohibited in Australia.

A foreign investor wanting to acquire an already-built apartment in Sydney in 2025 had their application rejected by FIRB, in accordance with the new law. They were, however, able to invest in a new real estate development, subject to FIRB approval, payment of stamp duty surcharge, and compliance with construction obligations.

Key Takeaways:

• Only new properties, under construction, or vacant land for building are generally accessible to foreigners.
• FIRB approval is mandatory and costly.
• Procedures, taxes, and restrictions vary by Australian state and applicant status.
• Any violation is heavily penalized.

Important:
Any attempt at illegal purchase exposes the investor to high fines, prison sentences, and profit confiscation.