Hi there. Property ownership in Australia is heavily regulated, and there are strict ownership rules around who can buy property. Temporary residents and foreign non-residents, including temporary visa holders, are subject to strict rules and fees when purchasing residential property, that Australian citizens and permanent residents are not. It is not clear whether you are looking to purchase a new dwelling or an established dwelling. This distinction is very important as different restrictions, fees and responsibilities apply.

New dwelling

If you are looking to purchase a ‘new dwelling’, you will not be subject to any conditions, other than gaining approval from the Foreign Investment Review Board (FIRB), and there is no limit on the number of these properties you may purchase. However, before purchasing one, you should find out more information from FIRB (www.firb.gov.au) to avoid a penalty.

Established dwelling

If you are looking to purchase an established dwelling, you must gain approval from FIRB and satisfy additional conditions. Temporary residents are only allowed to purchase one established dwelling to live in as their principal place of residence in Australia. That property cannot be used for investment, renting, or holidaying purposes. In your case, once your visa expires and you leave Australia, you are required to sell the property within three months.

FIRB approval

As a temporary resident, you will be required to apply to FIRB before purchasing any property. If, while you are waiting for your application to be approved, you purchase a property, you may be found to have broken the law. There is no standard processing period in which to expect an outcome of your application, although, the maximum is 40 days from the date of lodgement and payment of fees. The fee that must be paid depends on the price of the property that you are purchasing – starting at $5,000 for a purchase valued at $1 million or less.

Fees for NSW

In NSW, a temporary resident who purchases a property, whether existing or new, is required to pay a 4 per cent surcharge duty as well as a 1.5 per cent land tax surcharge. These fees are not applicable to permanent residents and citizens. You will also be required to pay a transfer of land duty, which is a fee that is calculated on the value of the property being purchased, and is paid by both foreign and permanent residents. These fees apply whether or not you will be living at the property. As a holder of a temporary visa, there is little that you can do to eliminate any of the charges that will apply to your purchase.

Suggested way forward

Purchasing property can be complicated, and knowing your responsibilities as a potential owner of property is important. To ensure that you comply with the laws that cover foreign purchases of property in NSW you should speak to a property lawyer who will be able to assist you with your purchase. By pressing the “Consult a Lawyer” button, LawAdvisor can help you search for experienced lawyers and obtain fee proposals for their services. Costs for legal advice and representation will vary between providers based on experience and the scope of services.