The value of forced sales of property held by foreign nationals has surged above $100 million as the Federal Government moves to stamp out rorting of Australia’s real-estate ownership laws.
In his latest announcement, Federal Treasurer Scott Morrison announced that sales of fifteen properties across Victoria and Queensland which have a combined value of more than $14 million and which are owned by foreign nationals, saying that the properties in question had been acquired in breach of Australia’s foreign investment review framework.
Owners of the properties in question came from China, India, Indonesia, Iran, Malaysia, the United Kingdom and Germany.
The latest batch brings the total number of forced sales since the government announced a crackdown on illegal foreign buying activity to 61 properties worth $107 million.
A further 36 foreign nationals have sold properties during the course of Australian Taxation Office investigations.
In his statement, Morrison said the foreigners in question purchased their property without first obtaining approval to do so from the Foreign Investment Review Board, and in some cases held multiple established properties.
Under Australia’s foreign investment framework, foreigners generally need approval from the Board prior to purchasing residential real-estate in Australia.
Whilst foreigners are generally free to invest in newly built or under-construction housing stock, they are typically barred from purchasing established dwellings outside of purchases which are for their own residential use.
These rules are in place in order channel foreign purchasing activity toward activity which will result in the delivery of new housing stock rather than having foreign buyers competing with local buyers and bidding up the cost of established stock.
Hitting out at the previous Labour Government, whom he says enabled illegal foreign buying activity to continue unabated through a lack of enforcement action with regard to the rules, Morrison said the latest orders reflect the government’s desire to see the law enforced.
“The forced sale of over $100 million worth of Australia property underscores the Turnbull Government’s determination to enforce our rules so foreign nationals illegally holding Australian property are identified and illegal holdings relinquished,” Morrison said.
“Under the previous Labor government, no foreign nationals were forced to divest illegally held Australian property.”
According to Morrison, the latest breaches of the rules were identified by the Australian Taxation Office through data matching and information from the public.
He says the government’s crackdown has seen the ATO issues 388 penalty notices to foreign nationals in breach of the rules, attracting penalties of more than $2 million.
In addition, Morrison says the introduction of hefty fees for applications to the FIRB has raised $140 million in order to fund enforcement efforts.