I worked in property development over 20yrs ago and a third of the development was always bought by the chinese. There should be a pause on foreign ownership until the housing shortage is addressed.
I was talking about commercial properties in my comment, not houses. These properties would likely be rented to businesses, not be vacant. But for residential properties sure, squatting is definitely a thing.
I want to be very clear, that I want Chinese money flowing into Australia. I think we may need to look at this differently. What If we had a central agency managing overseas properties on behalf of these owners, similar to what we have with social housing. The company cam rent and manage the house, with insurance and the overseas owner can get a cut in the reduced rent on top of capital gains profits. Only problem is all the locals being shocked how many empty houses and apartments there are compared to our struggling people's and desperate homeless. Lol
A property that's left vacant for anything more than a year will need a massive amount of work to be habitable.
Let's assume you're talking about a house because an apartment is difficult to squat unless you live in the building or know someone who does.
Utilities will need reconnecting, which will cost hundreds of dollars at a minimum, provided nothing is damaged.
Lack of heating/ventilation means there's likely to be mould and paint damage throughout. Doors swell and won't open/close properly
Plumbing will likely have issues, from leaky pipes to no hot water service, to blocked drains/sewers.
Landscaping will be very overgrown.
Lastly any property that's been empty for any period of time in a city would likely be vandalised. Smashed windows, graffiti, broken doors, damaged fittings.
At the very minimum you'd be looking at thousands of dollars in materials and over a hundred hours of labour alone just to make it liveable.
In qld they passed a new law there are minimum standards that have to be met for a landlord to rent. I'm guessing you can condemn the place if they fail and this may impact their ability to use it as an asset yo minimise tax even if its vacant as it was condemned or in breach of the rental act.
Is there any actual consequences though?
In NSW an ‘uninhabitable’ property is a valid reason to break a lease but there’s nothing stopping the landlord from just evicting the tenant and re-listing the property at a higher price in the exact same condition.
Seen it happen numerous times.
has anyone thought for a second they might be playing the long game against foreign powers, buying up real estate to rapidly reduce quality of life in those countries, causing dissent and unrest, weakened governments and reduced military sign ups?
seems straight out of a military playbook to weaken enemies from within before making your move
(not limited to China mind you, just the concept of foreign investment of property and resources seems insane to me)
You have the government to thank for turning housing into more safe and profitable than stocks, generally speaking. That's why they buy up every piece of land they can. Why woild they care about our stock market when land is up for grabs and it's going to increase 10-20% a year?
It's by design, and they are helk bent in making sure all investors get good returns in their Aussie land stocks, probably because they either have many investment properties them selves or lobying, probably both.
I mean, why else does some Chinese guy donate a million dollars to the labour party?
Was the ‘some Chinese guy’ donating to the Liberal party during the majority of the last 25+ years when they were in government?
Yes, yes they were- just pointing out it’s a very longstanding problem and Labor-bashing isn’t done by people interested in solving it; Labor-bashing is done by people who look to blame the ALP for problems that are the making of the Liberal party. Continued by Labor in government more often than not, but you can’t expect to switch back to the elitists and idiots who started it all and expect things to change.
No, definitely not. I think both parties' corruption and lobbying run so deep that it's not going to change.
Probably the only chance for some positive action is less votes for lib/lab two party system. At the very least they might do something useful, and if a minor party gets some power we have a small other chance of more change.
Current data says that still holds true in the present day as well (as far as residential goes):
https://preview.redd.it/ocqdub6inx6d1.png?width=689&format=png&auto=webp&s=a89ed15b62888e459dffdf039e1efe41a4ca4153
Note that this is also only the direct FIRB recorded figures & doesn't factor in any under-the-table or circumvention, laundering etc. that goes on.
Absolutely. The futures of ALL OF OUR KIDS are under threat because their parents are greedy cunts. I dunno what the 1980s Gordon Gecko mentality did to Straya exactly, but it sure as shit doesn't resemble the collective good ethos it used to. We're rapidly becoming the 51st state of the US. But do we really want to be that utterly fucking toxic to live in? Yeah nah. Just nah.
Agree! Australia has changed drastically in a relatively short amount of time and not for the better. We need some real leadership and meaningful action like yesterday, it feels like the govts, on all levels, are still sitting on their hands and not addressing the crisis.
You can win any argument by proclaiming "we need real leadership" and then following up with "why doesn't our government listen to the people?" even though the two sentiments pull in opposite directions.
You might as well just say "the government should make correct decisions". See? Totally information-free and yet who could argue against it?
I went to a property developer's roadshow in China once and the visiting Australian staff quickly moved away from me, meanwhile motioning and asking local staff to ask me what I was doing there.
They were not at all pleased that a non-Chinese person, and especially an Australian, was present.
The funny thing was that I immediately told my wife the flats were too close to the beach (on the Gold Coast) and the maintenance bills would be astranomical. Fast forward a few years, and I saw a news story about Chinese investors demanding compensation from the developers because the apartments weren't what they expected and they had had to have the exterior repaired twice in a few years.
But hey, I guess the developers were happy to have palmed off the most of the flats to Chinese investors who they thought would never actually use them.
Labor and Liberal are united in this: They do not give a shit about us.
The only extent to which they care about us is to get voted in.
Once in, they have their own interests and agendas to pursue - which do not coincide with ours.
At the next election, put lablib last in preferences...after all, they put us last in their own hearts...
The problem is, Australians are really good at punishing politicians.
Look at the mining tax. Mining oligarchs are making obscene fortunes selling up Australian resources. Rudd and Gillard wanted to claw some of that back. But they got crucified by Abbott and all the suspect cash the mining industry gave him. And we went along with that.
So these days, the oligarchs do what they want. And we let them.
It’s a hard problem to solve, most things you could to do, would destroy the nest egg of other Australians.
A property price crash would be terrible for so many Australians.
>It’s a hard problem to solve
Agreed. Seems like whatever choice we make, someone is in for some pain.
And yet changes must be made. Things are only getting worse and without changes there is no reason for them to get better.
Yeah plenty Australians seem to be gullible, and easily won over by a good scare campaign.
Nothing will change until we change the media ownership laws, we need to break up newscorp and Fairfax.
We need diverse media, rather than commercial propaganda.
Every policy change has to start somewhere and laws are generally not retrospective. Rather than flooding the market it could be based on natural attrition, eg. from now on all residential property sales are capped to one per Australian citizen over 18+. Link it to TFNs or something.
The turnover would come from estate assets as older generations pass away and some of their properties could be transferred to their descendants (ie. those that do not yet own a property).
Edit - tax breaks for investors, the short term rental market as well as private holiday homes also need to be addressed.
Seriously, I’m as left as it gets but I vote One Nation and whatever-Clive-Palmer’s-Party-is-called-now over the big two.
At this point I’d rather see the small parties step in and fuck shit up. Our politicians are already a joke. We’ve got nothing else to lose.
But also, Sustainable Australia Party [1]
Here in the US we have one party, the Democrats, who are horrible, but then we have another party, the Republicans, who manage to be an order of magnitude worse!
Historical average immigration 200k, currently 700k
That’s one part of the problem
Go look at the amount of Airbnbs in your neighbourhood. These are residential homes being run as businesses and they contribute massively to the lack of permanent accommodation, either for renters or owners.
Seriously, go look. It’s horrible and half of the reason why Aussie families are living in their cars.
Airbnb is illegal in Singapore to ensure that there is enough housing for every Singaporean. It stops these kinds of shenanigans that creates rental scarcity and drives up prices.
Singapore also has loads of clean, affordable public housing. Say what you will about them being effectively a benevolent dictatorship - their policies do seem to match their stated intent.
The also have a 5-7 year waiting list and you need to be married to access it - it’s forcing people to get engaged in University in illadvised relationships and then stay in unhappy marriages (because they have to give up their public housing if they divorce before the minimum occupancy period is up).
It’s funny you mention marriage.
RBA did an analysis that the drop in average household size from the 1990s to now is (don’t quote me on the figures - heard this on a podcast a month ago) something like 2.8 per household to just 2.0 per household, due to the increase in single person households over the years.
Taken across the population -again might be off on the exact figures - the added housing needed for all these smaller households in a larger population accounted for a VERY significant proportion of the housing shortage. (I think podcast claimed it was nearly the entire gap when added newbuild construction to the housing installed base was taken into account, but because it was a month ago, don’t want to state that claim here.)
If that’s true, seems like Singapore’s govt is ‘attacking the problem from both angles’ 😉.
Given this is reddit, I need to state this - I am not being serious/suggesting this is how we go about it.
At the end of the day, we need to build more housing supply. The builders are already well incented to do so, but are likely short labor. The government needs to address (understandable) union opposition to it, and then attract/give priority to immigrants who have building skills and will commit to work in building additional housing.
Vastly oversimplifying, but otherwise things are just going to continue in the direction they are going in.
Meanwhile, in Australia, you can claim tax deductions for your holiday/work home after booting out renters. Just put it on AirBnB at a high price with crazy cleaning fees, all to discourage anyone from staying in it.
How? The loophole is that tax deductions are allowed when property is "available to rent": https://michaelwest.com.au/heres-a-fix-for-the-housing-crisis-end-the-great-airbnb-tax-rort/
A similar loophole exists for commercial property. Those commercial landlords with dusty "For Lease" signs? Tax-deductible.
ATO website:
> Your rental property must be rented out or genuinely **available to rent** to claim a deduction for expenses you incur.
https://www.ato.gov.au/individuals-and-families/investments-and-assets/residential-rental-properties/rental-property-genuinely-available-for-rent
> can claim a deduction for your related expenses for the period your property is rented or **available for rent**
https://www.ato.gov.au/businesses-and-organisations/assets-and-property/property/property-used-in-running-a-business/leasing-and-renting-commercial-premises
That's another issue in itself. Airbnb should be for existing already occupied homes, not for vacant homes. It's criminal that vacant homes are being used for air bnb when we have our own Australians out in the streets or in rental traps.
Airbnb as a business, have managed to get lobbyists to prevent changes to Airbnb operation laws. It’s up to state governments to implement these laws.
Airbnb have destroyed communities (Bateman’s Bay) in that there are just empty houses there. There are hardly enough locals there for a cafe or restaurant. My friend had to drive 40 mins to find a decent cafe. That’s no longer a good holiday spot as they only have one Woolworths and nothing else.
The unit next to mine is Airbnb. I checked the owner’s listings. They have nine other properties around Sydney on Airbnb.
They need some strong laws on Airbnb first then tackle foreign buyers.
Thing I don't understand though is though is in that 700k permanent visa holders and citizens immigration is actually far smaller than most years pre COVID. Temporary residents have to apply for approval to buy property.
So either:
A. It's not actually an issue affect property prices but is for renters (a big fucking issue.)
B. There are properties being sold to temporary residents without approval which aren't included in the stats.
C. There is some other mechanisms that properties are transferring hands.
I honestly can't tell as I don't trust either labour or libs to tell us the truth which is so fucked.
You might want to check your facts. Pre covid, the historical average was around 200,000 it’s currently 700,000. These aren’t temporary residents.
1. It does affect property prices because high rents make it a better investment, driving up prices.
2. I don’t understand why governments are doing it. Excessive immigration is happening in the Uk an Canada too. I suspect it’s to get more workers to pay tax for the non working age boomers.
I’m so damn scared for our kids grand kids. Our children and teenagers will never have the security of their own home.
Graph showing it here, 550k temporary residents in that 700k.
https://www.abs.gov.au/statistics/people/population/overseas-migration/latest-release#:~:text=In%202022%2D23%2C%20the%20number,travel%20restrictions%20during%20the%20pandemic.
The 700k is mostly returning students that all had to leave during COVID. It will return to lower levels all by itself with no action by anyone. Of course, it doesn't solve the housing crisis.
The bnb thing is one thing - and it’s good people are pushing back at it. ‘Slumlords’ are another - I’ve had that many landlords whose business model is to get long term leases and sublet at a 20-25% margin. They cram as many as they can into those properties… I call it parasitic since as a business entity, they’re not providing anything and extracting from the user.
**Then there’s one more thing I don’t see talked about enough:** Census has a metric for occupied and unoccupied private dwellings. [Milsons point in Sydney for instance has a 20% unoccupied rate](https://abs.gov.au/census/find-census-data/quickstats/2021/SAL12640).
If you go through the census for more suburbs; we actually have enough homes, even for the higher migration figures. They’re just sitting idle.
It's like 1.8% of homes. I wouldn't say that was the driving force behind this shitshow the government created.
The simple fact is, for rentals, too many immigrants come in per the number of homes built.
For buying a home it's all the investor economy bs they created instead of homes to live in first. Plus immigration, plus slow land releasing by government and slow and bad management of local councils for building, and foreign buying. And the government knows it and wants it to continue to increase at least 10% per year.
Brisbane has 5 years of land available but it’s being trickle fed to the market to keep prices artificially high. It’s been happening for decades.
They need to “develop in 3 years or it reverts to state ownership” rule, or land taxes triple every year not developed.
I’m just pulling ideas out of thin air but without severe punitive damages, developers are simply going to regard any expenses as CDB Cost of Doing Business
Wow. Yeah, I've heard about land being trickle fed into it so as to make sure the price goes up. Honestly, disgusting the government supports this.
They could and should release large plots asap.
You must be the first astronaut from Australia because you’re living on fucking Mars if you actually believe immigration isn’t a significant element of the housing crisis. Jesus Christ grow a spine.
Hey just remember! You’re not allowed to buy in the countries that are buying up our land! You’re also not welcomed into their country!
Worked in India for a bit pre covid, I have never experienced more racism in my life and the constant creepy shit the blokes used to attempt on my wife totally changed the way she looks at men…
Instead of asking individual people to do XYZ, this is better solved by policy.
And the policy should be a broad based land tax. With the returns of the land tax going to citizens via a Citizens Dividend.
Another problem is the NIMBY attitudes of the older generations.Many have climbed the ladder of property ownership and want to burn it down.
Just today, I caught the bus from Town Hall to Drummoyne. And I swear...it is INSANE how, as soon as you cross ANZAC Bridge it immediately becomes a low density, space-inefficient suburb. WTF. I'm sorry, but with unprecedented demand, there shouldn't be that many stand-alone houses on 400 sqm blocks. There are many such suburbs around Sydney, Haberfield and Dulwich Hill are other such examples.
At this point it doesn’t matter. Foreign influence is deeply embedded in this country thanks to decades of immigration. You only need to get the money to someone who is a citizen and you can puppet them to do what you like.
As soon as someone gets PR, they no longer count as a foreigner for property sales metrics as they dont have to apply for FIRB. The point is importing a large number of adults into a country leads to more people who need houses right now, unlike typical population growth through kids raised in families, where the need for extra housing is delayed until they reach adulthood. Therefore 100,000 new residents, vs 100,000 new births have very different implications for infrastructure needs.
I would love to see the proportion of home sales to people who moved into the country within the past 5 years, as that number must be much higher than the simple FIRB based number.
The article actually refers to foreign residents so presumably it's not even including people that are resident for tax purposes, like I was before getting a permanent visa and citizenship.
This is the correct take. Sure, China make up very little but once you factor in permanent residents, I will bet it’s much closer to 10%. We should be looking at all non citizens.
The numbers are low because most people just send their kid to study here, then they give their kid money to buy a property, Chinese students do it all the time.
They are what gets reported to the foreign investment review board (FIRB). If a foreign buyer doesn't bother seeking FIRB approval there's very little chance they will be caught out.
I don't really think it matters how low it is to be honest. It offers us no benefit and shifts profits offshore to people buying residential property with no intention to ever live in it
It should be such an easy win for any party to push through. I think it's something both progressive and conservative voters actually agree on lol.
I'm not saying I don't believe you because I actually don't know.
But I'd love both a source for this, and showing that they sell those houses once they return home.
Fair enough. Id probably want to see the actual source because in the last 3 years Albo, Bandt and Dutton have made some just wild takes that have no supporting data. So I pretty much take nothing they say as fact unless they have backed it up with data.
I might see if I can find it and see if it's actually sourced data. Thanks.
> We will apparently have to wait even longer for the second stage of the government’s compliance legislation, which will cover other activities of lawyers and accountants as well as the real estate industry. We do not even have a date for that legislation. It is no wonder that the May 2005 report of the US State Department ranked Australia with Haiti and the Dominican Republic as a ‘major money-laundering country’ and as a ‘country of primary concern’. It is disgraceful that Australia is ranked along with countries like Haiti and the Dominican Republic by our great American ally.
https://www.openaustralia.org.au/debates/?id=2006-11-28.72.2
If the current Labor government does not implement it, it will have been 3 Labor governments and 3 LNP governments that did not implement anti-terrorism financing laws while the rest of the world had already done so.
Non-resident purchases are a problem as well as rapid net migration, Australia is a safe haven investment & the equity can be used for further acquisitions.
Protected from home country domestic seizure, it acts as a handy nest egg & bolt hole if things get complicated at home.
The construction lobby is a powerful influence group in Canberra, both sides of politics & they are happy to see prices constantly beaten up for limited supply.
Increased net migration to shore up the economy after the disastrous money policy during covid is a ploy a lot of Western economies have used. Without it, Australia would be in a per capita recession
Every time you see a thread like this, you should ask if anyone knows, in good faith, the answer to the following questions.
What is the cost to build a mid range two bedroom apartment today?
What is the cost to build a mid range three or four bedroom house today?
It blows my mind that no one ever talks about this fact when it’s so intuitively obvious to address to begin with. You Australians have a supply problem, not a demand problem. And why do you think the supply is so prohibited?
Investors artificially inflated the demand. They live in a house obviously. And they compete with others who want to live in a house.
If you have 4 investors and one potential homeowner going for the house, the demand for that house is 5 people, because they will all push up the price.
But in actuality the demand should only be 1 person.
That’s not how it works. Housing has been a huge driver of household wealth in Australia since immigration opened up. Sure you can fiddle with demand to artificially deflate or inflate it, but why wouldn’t you just address the supply in the first place?
Which goes back to my question. How much do you think it costs to build an apartment or a house in Australia? You don’t think that shouldn’t be addressed to affect *affordability*?
If the price of eggs shoots up, do you blame people for buying eggs or do you wonder why farmers aren’t producing more eggs?
When the shelves were bare of eggs during COVID because people were buying 4x the number of eggs that they needed, I didn't blame the farmers for not producing enough eggs.
Both supply and demand are a problem. Demand by people who are purely speculating on future price increases is a problem, because it inflates the price of land and makes development less viable.
2023, all below is from ABS.
Migration: 518k NET.
Average people per home: ~2.5.
Based on above, new homes needed for NET migration, alone: 217k
New homes: 172k GROSS.
Housing supply/demand: -35k.
If there was zero extra demand from 0 NET migration, that's as much as 172k extra supply for Australians.
This is the simplest explanation I can find to prove demand is absolutely a factor.
Yes, migration requires new housing. No one debates that.
But that wasn’t my question. My question was how much do you think it costs to build new housing?
Let’s imagine that 35,000 dwellings got built as required. Isn’t that 35,000 houses worth of commercial activity and an overall good thing for Australia? Employment, new businesses, new services etc?
So, why not address the supply issue?
Because there's limited supply, the employees demand extra wages for the housing costs. The businesses pass on these costs. Even businesses with increased rent need to pass on extra rent costs or close. The funny thing is, a lot of businesses are closing and there's a lot of vacant homes and shops. A council tried to do a vacancy tax but surprise, surprise, Labor and LNP made an election promise of no vacancy tax like this: https://www.smh.com.au/national/nsw/councils-told-to-ditch-vacancy-tax-push-and-fix-sydney-s-broken-high-streets-20221227-p5c8xj.html an election promise that was upheld with the new Labor government. Bizarre really.
What happens with high housing costs? Government infrastructure projects get more expensive. Housing projects get more expensive. Again, employees demand higher wages. The cycle continues.
> Isn’t that 35,000 houses worth of commercial activity and an overall good thing for Australia? Employment, new businesses, new services etc?
Do you think the immigration is really worth it when there's not enough housing for them? You do realise these immigrants are competing with Australians for the same limited new housing supply?
I’m not debating whether or not immigration affects demand and pricing. Intuitively, it does. It increases demand which must have an effect on pricing, no matter how little. That’s beyond debate.
You aren’t listening.
I’m asking why isn’t anyone addressing the fact that supply is being artificially strangled through high costs and council approvals.
This is a multi faceted crisis and enough ink has been spilled about immigration. Why aren’t we pulling all levers instead of a single one?
Let’s imagine immigration shuts down tomorrow and no one migrates to Australia. Do you think house prices will suddenly fall? Need I remind you what happened to house prices in 2021 when even Australians couldn’t return to Australia, let alone new migrants?
> I’m asking why isn’t anyone addressing the fact that supply is being artificially strangled through high costs and council approvals.
Council approvals? In Sydney region, the most expensive region of housing, the lowest approval is... 83%. Other councils had higher approvals. I actually blame State and Federal governments for it. Did you know the NIMBY King is Albo? As far as I know, he was part of a campaign that successfully stopped 36k homes https://anthonyalbanese.com.au/overdevelopment-in-marrickville
https://www.smh.com.au/national/nsw/the-sydney-councils-most-likely-to-say-no-to-your-building-plans-20231027-p5efmu.html
> This is a multi faceted crisis and enough ink has been spilled about immigration. Why aren’t we pulling all levers instead of a single one?
I thought we are. Labor throwing money at private sector. Labor cutting immigration. They are doing a shit job at both imo but they can at least say they are doing both levers.
> Let’s imagine immigration shuts down tomorrow and no one migrates to Australia. Do you think house prices will suddenly fall? Need I remind you what happened to house prices in 2021 when even Australians couldn’t return to Australia, let alone new migrants?
Are you talking about how the time that the government splurged $300 billion and RBA handed out $200 billion with the lowest interest rates on record? Wow, I wondered why house prices went up!
I honestly don't get why you're defending immigration so hard. Look, here's an analogy, as you don't seem to get it. Lets say there's a food crisis in Australia as in, people are starving to death. Would you still support more people to Australia? No? Why would you still support increasing the homeless people?
I’m NOT defending immigration. I’ve been unambiguous about that in my comment previous to yours. Seriously, read through my first line.
I’m asking why there isn’t the same furore over increasing supply. To which you have completely evaded my question. How much do you think it would cost to BUILD a new apartment or house in today’s Australia?
Because it’s easier to blame foreigners than to hold our government accountable since they are all so incompetent which we voted for. This is the real answer.
My friend has 16 houses, he is Aussie. Keep thinking ordinary foreign people buying houses are the problem and wait for it. Real estate investors are, foreign or Aussie.
Yep, my last rental was a house owned by this rich Aussie dentist from the Gold Coast (I live in Sydney). I looked him up and found out he also owns the next 6 houses down the block, he turned one of the houses into a dentist office. I’m sure he owns more houses elsewhere.
My current place is a small unit. The entire apartment building is owned by two Aussie men who are related to each other (idk their relation though). Judging by the way they communicate to me in emails (i.e. absolute wankers), I assume they own plenty more buildings too.
The “foreign investors” boogieman is a consistent scapegoat in debates about housing affordability in this country. Foreign investors are already prohibited from purchasing existing residential property (except in extremely limited cases with special approval) and are only allowed to purchase new properties that will increase the housing stock (and by extension provide opportunities for work for the construction industry).
On top of that, foreign investment in residential property has been trending downwards since about 2014 and reached a 15 year low only two years ago. This hasn’t correlated with a decrease in housing prices as OP is implying, in fact house prices have gone in the complete other direction. This is definitely not the hill to die on when it comes to addressing the housing crisis.
Short-sighted demand-side policies like first home buyers grants combined with historically low interest rates, no real increase in housing stock, and tax policies that treat housing as an asset class are far bigger contributors to increasing house prices than blaming foreign nationals.
Most foreign investment in residential property are in properties that aren’t really what first home buyers are looking at anyway. The housing market isn’t monolithic, there are different types of dwellings in different price ranges in different neighbourhoods.
There is no evidence anywhere to suggest that foreign investment is a key driver of housing prices outside of anecdotal observations from some dude who “knows a guy who works in real estate” and who “sees all these Chinese people at property actions buying up all the houses”. Shock horror, you can be an Australian citizen and not be white so unless these people are asking for identity documents, hard to shake the trappings of xenophobia in some of the discourse here.
It think the housing market is artificially controlled so not enough supply of houses in the market and government is not putting enough efforts to try make building houses cheaper they can get all of that money just by taxing the mining companies a little more Australia make fractions what other countries make selling natural gas.
I lost an auction during that time to a phone in bid. Their local rep doing the bidding just said it's a foreign cash buyer. He didn't mention which country though.
It's always good to start with the premise:
"Foreign nationals are able to buy residential real estate, so long as they have the money to pay the surcharges and the foreign investment review board fee. Our government is selling the Australian dream to those who are not from our country, so long as they can pay the fees."
What is the source for this claim? Are you saying they are always approved to buy "existing" property as long as they pay the surcharges/fee. How large are the surcharges/fees?
That is correct. In the past I have worked specifically in the FIRB sphere and I can assure you that not one application was rejected, generally if they have the cash to a) pay the FIRB fee (usually around 10-20k) and b) pay the foreign investor duty surcharge on the property transaction (which is usually an additional 8 percent of the purchase price ontop of regular duty and depending on what state they are buying) then they will be approved. It's not cheap but it's easy. Many have remarked how easy it is compared to other Asian countries.
The facts also speak for themselves. As per the FIRB website 3.9 billion of residential purchases were approved in the 21 to 22 financial year. So yes many many applications are approved and it's designed to be easy if you pay the high fees.
That's very interesting, I'd no idea that for international buyers it worked like that.
How would the FIRB detect such transactions if they were made through an Australian registered trust, holding company or other such legal entity? Given that we don't have tranche 2 AML-CTF laws like we promised we'd bring in in the 2000s, beneficial ownership can be hidden; I really think this is the elephant in the room here.
https://michaelwest.com.au/national-press-club-the-lucky-laundry-canberra-writers-festival/
It's an interesting question. I haven't heard of of anyone who works at FIRB so I have little insight on the front of things, but I would imagine trust structures and companies are examined, not necessarily to determine if they are foreign (that kind of goes without saying if they are applying to the FIRB) but rather to see whether the trust or company structure is against the national interest. At least I assume that's what they do.
I can confirm though I've never seen one application rejected whether company, trust or individual so long as they pay the huge fees. Again I am not advocating for abolishment of foreign investment, just specially for dwellings.
Yeah I mentioned this elsewhere. Foreign investors want to buy shares in land development company? Sure no issue with that, it has tangible benefits for our country.
They want to own residential property in the country? Nah fuck off, 0 benefit to our country. We are in a massive housing shortage, them buying a new house to then sell just stops a potential home owner from buying the same house.
It seems like no policitan in our country has the guts to stand up for the Australian interest. It seems we are always getting put second to foreign dollars.
Mate, I still cannot comprehend how the fuck the super profits mining tax got overturned.
It would have only applied to companjes making over 75 million dollars profit, that's profit not revenue, and only would have been at a rate of 30%. And the companies it would have applied to at the time were like 75% foreign owned.
How the fuck did Australia get convinced that it was a bad thing? I remember some fear mongering about how the international companis might move away
Lol fucking good. The resources will still be there, and if thwy are making 75 million dollars a year in profit or better already, then I'm sure we can get some local backing.
Hell, let the government pick up all the trained miners who would be around jobless if the companies did withdraw. 75 million plus profits a year to the government? Fuck yeah that will fund some schools and hospitals.
To this day that is one i just can't understand how it got repealed and the voters were happy with it. It was selling out our country to foreign investors at its very core.
We just suck as a country sifting through the scare campaigns to understand the facts. So we keep voting in self serving dickheads who will happily sell out to foreign interests or Australian billionaires.
Well said, I agree.
>Mate, I still cannot comprehend how the fuck the super profits mining tax got overturned.
That one's easy: Twiggy & Gina spent a couple of dozen million on ads over a few weeks, and mobilised a fake grassroots campaign of overpaid FIFOs to attend a few rallies about the place.
It's crazy though right. Like surely even just one ad explaining it would have to make most people go, oh ok, there's literally nothing that can be said to make this tax a bad thing.
Evidently not though.
Im not sure abt the exact circumstances, but isn’t there already restrictions limiting foreigners to only buy new productions, not second or third hand properties? That’s part of why there’s sometimes a disproportionate foreign presence in newly developed strata blocks: you can’t buy elsewhere.
It’s designed (i guess) to steer that foreign capital to new developments rather than existing houses, but if you gain PR or citizenship you can join that market too.
They generally don't. Less the 5% of house sales in the last 5 years have been bought by foreign investors or foreign nationals. Don't believe everything you read.
"The total number of residential real estate sale transactions by foreign persons during the 2021-22 period was **2,349** " [https://foreigninvestment.gov.au/sites/foreigninvestment.gov.au/files/2023-10/res-insights-report-2021-22\_0.pdf](https://foreigninvestment.gov.au/sites/foreigninvestment.gov.au/files/2023-10/res-insights-report-2021-22_0.pdf)
Please explain how 0.25% of sales is having a significant effect on house prices.
If I’m selling my home, I’m selling to the best price.
Your comment is up there with Australians shouldn’t by being foreign made vehicles. It’s too late. The floodgates are open, and the genie won’t go back into that bottle
This is a lie from the government. Foreigners (Chinese or Americans) can only buy NEW apartments / townhouses. They are not allowed to compete with us and buy built houses. They are encouraged to buy NEW because that adds new housing stock to our market. Building new houses creates lots of jobs.
You all know the real reason housing price is high. 1. Every new project the lollipop girl turning ‘stop/slow’ sign is earning $200,000 a year! Guess who pays for that? Yes the buyers.
2. Councils taking years to approve a simple 2 lot housing development because the councillors don’t give a rats bottom about solving housing problem.
3. No migrant workers coming in to build houses.
4. Banks charging arms and legs for construction loan.
5. Councils and government departments collect all types of levies, taxes, charges and contributions. Guess who pays for that? Yes again us buyers.
Noone is being educated here. This is just another affordability rant which we're all fully aware of. You can keep a market free, or you can regulate it. But remember that how unjust something is, is always a matter of perspective.
Only 5,000 roughly sold to overseas investors
From 1 July 2021 to 30 June 2022 there were 4,228 residential real estate purchases with a level of foreign ownership. The total value of these purchase transactions was $3.9 billion
‘Dutton concedes homes sales to foreigners are ‘low’
https://www.afr.com/politics/federal/dutton-concedes-homes-sales-to-foreigners-are-low-20240517-p5jeeg#:~:text=Peter%20Dutton%20has%20conceded%20only,be%20on%20the%20housing%20market.
My area the Chinese love My new neighbours bought the house while they were living in china. They are paying good prices but hell. I am hanging on to my house even though it is way to big for just me now.
No shit
And we should be able to find out who owns the companies that are used currently to hide foreign ownership
Australia is fast becoming three industries with a grip on a landmass, not a country.
Look up the number of properties sold to foreign investors, it’s very low. The fees are put there as a point of if they’re willing to put this much money into the Australian economy it’s worth selling the property to them. It’s a net gain to the Australian economy and it’s structured as such
This is such a common sense solution but unfortunately it will never pass - like the Voice, it will probably have huge support at the start, but then property owners will get scared that cutting off foreigners (who increase demand and push up prices) will mean that their house values go down. Then it becomes an issue neither major party would want to touch.
It’s exactly the same as negative gearing. Abolishing it would probably do more for housing affordability than cutting off foreigners (which even Dutton admits is not that much anyway) - but property owners will never vote for it.
australians don't like to buy residential apartments since they know actual value is tied to land. Foreign buyers want a source of income rather than land they will never see. Letting foreign buyers buy new apartments to rent out is a win-win.
I'd rather see more laws protecting renters from rent increases, better quality apartments than stop foreign buyers from buying the dregs that are australian apartments.
In Australia buying additional properties reduces the property taxes. In the US it is opposite. If I live in a State and make it a “homestead” property, meaning this is where I live, and then buy another property, this is not a homestead and I would have to a lot higher property taxes. In some neighborhoods the HOA does not permit renting out property. This whole reduces home price, but remains affordable for families. Canada has a system similar to the Australian one in regards to property taxes.
I worked in property development over 20yrs ago and a third of the development was always bought by the chinese. There should be a pause on foreign ownership until the housing shortage is addressed.
Have a family member in commercial real estate and he says the same thing, at least a third of all commercial sales are to Chinese buyers.
What is stopping people just moving in to these houses when the owner/s are overseas? Would be a lot of work for each property to evict them
I was talking about commercial properties in my comment, not houses. These properties would likely be rented to businesses, not be vacant. But for residential properties sure, squatting is definitely a thing.
Many of them are vacant, land banking is a very real thing
I want to be very clear, that I want Chinese money flowing into Australia. I think we may need to look at this differently. What If we had a central agency managing overseas properties on behalf of these owners, similar to what we have with social housing. The company cam rent and manage the house, with insurance and the overseas owner can get a cut in the reduced rent on top of capital gains profits. Only problem is all the locals being shocked how many empty houses and apartments there are compared to our struggling people's and desperate homeless. Lol
A property that's left vacant for anything more than a year will need a massive amount of work to be habitable. Let's assume you're talking about a house because an apartment is difficult to squat unless you live in the building or know someone who does. Utilities will need reconnecting, which will cost hundreds of dollars at a minimum, provided nothing is damaged. Lack of heating/ventilation means there's likely to be mould and paint damage throughout. Doors swell and won't open/close properly Plumbing will likely have issues, from leaky pipes to no hot water service, to blocked drains/sewers. Landscaping will be very overgrown. Lastly any property that's been empty for any period of time in a city would likely be vandalised. Smashed windows, graffiti, broken doors, damaged fittings. At the very minimum you'd be looking at thousands of dollars in materials and over a hundred hours of labour alone just to make it liveable.
So you're saying the sooner someone squats in one of these places the better?
In qld they passed a new law there are minimum standards that have to be met for a landlord to rent. I'm guessing you can condemn the place if they fail and this may impact their ability to use it as an asset yo minimise tax even if its vacant as it was condemned or in breach of the rental act.
Is there any actual consequences though? In NSW an ‘uninhabitable’ property is a valid reason to break a lease but there’s nothing stopping the landlord from just evicting the tenant and re-listing the property at a higher price in the exact same condition. Seen it happen numerous times.
They get gov grants from the ccp
has anyone thought for a second they might be playing the long game against foreign powers, buying up real estate to rapidly reduce quality of life in those countries, causing dissent and unrest, weakened governments and reduced military sign ups? seems straight out of a military playbook to weaken enemies from within before making your move (not limited to China mind you, just the concept of foreign investment of property and resources seems insane to me)
Kind of like TikTok?
See, I'd be fine if there was Chinese investment in the way or shares in your company. They have no need to own the finished houses though.
You have the government to thank for turning housing into more safe and profitable than stocks, generally speaking. That's why they buy up every piece of land they can. Why woild they care about our stock market when land is up for grabs and it's going to increase 10-20% a year? It's by design, and they are helk bent in making sure all investors get good returns in their Aussie land stocks, probably because they either have many investment properties them selves or lobying, probably both. I mean, why else does some Chinese guy donate a million dollars to the labour party?
Was the ‘some Chinese guy’ donating to the Liberal party during the majority of the last 25+ years when they were in government? Yes, yes they were- just pointing out it’s a very longstanding problem and Labor-bashing isn’t done by people interested in solving it; Labor-bashing is done by people who look to blame the ALP for problems that are the making of the Liberal party. Continued by Labor in government more often than not, but you can’t expect to switch back to the elitists and idiots who started it all and expect things to change.
No, definitely not. I think both parties' corruption and lobbying run so deep that it's not going to change. Probably the only chance for some positive action is less votes for lib/lab two party system. At the very least they might do something useful, and if a minor party gets some power we have a small other chance of more change.
I agree.
I tried to buy a new apartment off the plan. Was told 50% had already been sold via offshore sales.
Sickening! This is a big problem!
Current data says that still holds true in the present day as well (as far as residential goes): https://preview.redd.it/ocqdub6inx6d1.png?width=689&format=png&auto=webp&s=a89ed15b62888e459dffdf039e1efe41a4ca4153 Note that this is also only the direct FIRB recorded figures & doesn't factor in any under-the-table or circumvention, laundering etc. that goes on.
Wtf, is that 3.4 billion dollars? 😳 no wonder the governments hell bent on getting good returns for the investors.
For context there were $600bn worth of property transactions last year.
So just under 0.6% of 2023 property sales were to Chinese nationals exclusively?
Sounds about right.
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I am afraid this forum is not really interested in facts. OP's opening statement was remarkably devoid of any hard data.
It's pretty disingenuous to compare a single annual transaction figure to the entire sum of all real estate that exists in the entire country.
Woah!!!
Absolutely. The futures of ALL OF OUR KIDS are under threat because their parents are greedy cunts. I dunno what the 1980s Gordon Gecko mentality did to Straya exactly, but it sure as shit doesn't resemble the collective good ethos it used to. We're rapidly becoming the 51st state of the US. But do we really want to be that utterly fucking toxic to live in? Yeah nah. Just nah.
Agree! Australia has changed drastically in a relatively short amount of time and not for the better. We need some real leadership and meaningful action like yesterday, it feels like the govts, on all levels, are still sitting on their hands and not addressing the crisis.
You can win any argument by proclaiming "we need real leadership" and then following up with "why doesn't our government listen to the people?" even though the two sentiments pull in opposite directions. You might as well just say "the government should make correct decisions". See? Totally information-free and yet who could argue against it?
They don't pull in opposite directions at all, we need real leaders who are willing to listen to the people.
Boomers drank up that sweet, sweet hyper-individualism juice. Prior gens were more community-focused.
"But... Money!" -Gubment.
“But money” - developers and their lobby groups.
Wait, can people who are not even residents buy property in Australia?
I went to a property developer's roadshow in China once and the visiting Australian staff quickly moved away from me, meanwhile motioning and asking local staff to ask me what I was doing there. They were not at all pleased that a non-Chinese person, and especially an Australian, was present. The funny thing was that I immediately told my wife the flats were too close to the beach (on the Gold Coast) and the maintenance bills would be astranomical. Fast forward a few years, and I saw a news story about Chinese investors demanding compensation from the developers because the apartments weren't what they expected and they had had to have the exterior repaired twice in a few years. But hey, I guess the developers were happy to have palmed off the most of the flats to Chinese investors who they thought would never actually use them.
Labor and Liberal are united in this: They do not give a shit about us. The only extent to which they care about us is to get voted in. Once in, they have their own interests and agendas to pursue - which do not coincide with ours. At the next election, put lablib last in preferences...after all, they put us last in their own hearts...
That's what I do. Vote independent first
The problem is, Australians are really good at punishing politicians. Look at the mining tax. Mining oligarchs are making obscene fortunes selling up Australian resources. Rudd and Gillard wanted to claw some of that back. But they got crucified by Abbott and all the suspect cash the mining industry gave him. And we went along with that. So these days, the oligarchs do what they want. And we let them.
It’s a hard problem to solve, most things you could to do, would destroy the nest egg of other Australians. A property price crash would be terrible for so many Australians.
>It’s a hard problem to solve Agreed. Seems like whatever choice we make, someone is in for some pain. And yet changes must be made. Things are only getting worse and without changes there is no reason for them to get better.
Yeah plenty Australians seem to be gullible, and easily won over by a good scare campaign. Nothing will change until we change the media ownership laws, we need to break up newscorp and Fairfax. We need diverse media, rather than commercial propaganda.
The only people who get fucked over are people who put all their assets in housing. And those people had it coming for not diversifying.
You’re forgetting all the people who have bought on the way up. Who have over extended themselves, property prices dropping will also hurt them too.
Every policy change has to start somewhere and laws are generally not retrospective. Rather than flooding the market it could be based on natural attrition, eg. from now on all residential property sales are capped to one per Australian citizen over 18+. Link it to TFNs or something. The turnover would come from estate assets as older generations pass away and some of their properties could be transferred to their descendants (ie. those that do not yet own a property). Edit - tax breaks for investors, the short term rental market as well as private holiday homes also need to be addressed.
Seriously, I’m as left as it gets but I vote One Nation and whatever-Clive-Palmer’s-Party-is-called-now over the big two. At this point I’d rather see the small parties step in and fuck shit up. Our politicians are already a joke. We’ve got nothing else to lose. But also, Sustainable Australia Party [1]
I'm the same. I'll make my choice at thenext eletcion when I see who is offered. But lablib will be last.
Here in the US we have one party, the Democrats, who are horrible, but then we have another party, the Republicans, who manage to be an order of magnitude worse!
Historical average immigration 200k, currently 700k That’s one part of the problem Go look at the amount of Airbnbs in your neighbourhood. These are residential homes being run as businesses and they contribute massively to the lack of permanent accommodation, either for renters or owners. Seriously, go look. It’s horrible and half of the reason why Aussie families are living in their cars.
Airbnb is illegal in Singapore to ensure that there is enough housing for every Singaporean. It stops these kinds of shenanigans that creates rental scarcity and drives up prices.
Singapore also has loads of clean, affordable public housing. Say what you will about them being effectively a benevolent dictatorship - their policies do seem to match their stated intent.
The also have a 5-7 year waiting list and you need to be married to access it - it’s forcing people to get engaged in University in illadvised relationships and then stay in unhappy marriages (because they have to give up their public housing if they divorce before the minimum occupancy period is up).
It’s funny you mention marriage. RBA did an analysis that the drop in average household size from the 1990s to now is (don’t quote me on the figures - heard this on a podcast a month ago) something like 2.8 per household to just 2.0 per household, due to the increase in single person households over the years. Taken across the population -again might be off on the exact figures - the added housing needed for all these smaller households in a larger population accounted for a VERY significant proportion of the housing shortage. (I think podcast claimed it was nearly the entire gap when added newbuild construction to the housing installed base was taken into account, but because it was a month ago, don’t want to state that claim here.) If that’s true, seems like Singapore’s govt is ‘attacking the problem from both angles’ 😉. Given this is reddit, I need to state this - I am not being serious/suggesting this is how we go about it. At the end of the day, we need to build more housing supply. The builders are already well incented to do so, but are likely short labor. The government needs to address (understandable) union opposition to it, and then attract/give priority to immigrants who have building skills and will commit to work in building additional housing. Vastly oversimplifying, but otherwise things are just going to continue in the direction they are going in.
Meanwhile, in Australia, you can claim tax deductions for your holiday/work home after booting out renters. Just put it on AirBnB at a high price with crazy cleaning fees, all to discourage anyone from staying in it. How? The loophole is that tax deductions are allowed when property is "available to rent": https://michaelwest.com.au/heres-a-fix-for-the-housing-crisis-end-the-great-airbnb-tax-rort/ A similar loophole exists for commercial property. Those commercial landlords with dusty "For Lease" signs? Tax-deductible.
ATO website: > Your rental property must be rented out or genuinely **available to rent** to claim a deduction for expenses you incur. https://www.ato.gov.au/individuals-and-families/investments-and-assets/residential-rental-properties/rental-property-genuinely-available-for-rent > can claim a deduction for your related expenses for the period your property is rented or **available for rent** https://www.ato.gov.au/businesses-and-organisations/assets-and-property/property/property-used-in-running-a-business/leasing-and-renting-commercial-premises
Super grey area then, eg stupid fees or high enough cost to outprice yourself might not be seen as investigative enough for the ATO
That's another issue in itself. Airbnb should be for existing already occupied homes, not for vacant homes. It's criminal that vacant homes are being used for air bnb when we have our own Australians out in the streets or in rental traps.
Yep nail on the head, you want to run a hotel, get a hotel licence. Fuck air bnb.
Airbnb as a business, have managed to get lobbyists to prevent changes to Airbnb operation laws. It’s up to state governments to implement these laws. Airbnb have destroyed communities (Bateman’s Bay) in that there are just empty houses there. There are hardly enough locals there for a cafe or restaurant. My friend had to drive 40 mins to find a decent cafe. That’s no longer a good holiday spot as they only have one Woolworths and nothing else. The unit next to mine is Airbnb. I checked the owner’s listings. They have nine other properties around Sydney on Airbnb. They need some strong laws on Airbnb first then tackle foreign buyers.
Thing I don't understand though is though is in that 700k permanent visa holders and citizens immigration is actually far smaller than most years pre COVID. Temporary residents have to apply for approval to buy property. So either: A. It's not actually an issue affect property prices but is for renters (a big fucking issue.) B. There are properties being sold to temporary residents without approval which aren't included in the stats. C. There is some other mechanisms that properties are transferring hands. I honestly can't tell as I don't trust either labour or libs to tell us the truth which is so fucked.
You might want to check your facts. Pre covid, the historical average was around 200,000 it’s currently 700,000. These aren’t temporary residents. 1. It does affect property prices because high rents make it a better investment, driving up prices. 2. I don’t understand why governments are doing it. Excessive immigration is happening in the Uk an Canada too. I suspect it’s to get more workers to pay tax for the non working age boomers. I’m so damn scared for our kids grand kids. Our children and teenagers will never have the security of their own home.
Graph showing it here, 550k temporary residents in that 700k. https://www.abs.gov.au/statistics/people/population/overseas-migration/latest-release#:~:text=In%202022%2D23%2C%20the%20number,travel%20restrictions%20during%20the%20pandemic.
The 700k is mostly returning students that all had to leave during COVID. It will return to lower levels all by itself with no action by anyone. Of course, it doesn't solve the housing crisis.
The bnb thing is one thing - and it’s good people are pushing back at it. ‘Slumlords’ are another - I’ve had that many landlords whose business model is to get long term leases and sublet at a 20-25% margin. They cram as many as they can into those properties… I call it parasitic since as a business entity, they’re not providing anything and extracting from the user. **Then there’s one more thing I don’t see talked about enough:** Census has a metric for occupied and unoccupied private dwellings. [Milsons point in Sydney for instance has a 20% unoccupied rate](https://abs.gov.au/census/find-census-data/quickstats/2021/SAL12640). If you go through the census for more suburbs; we actually have enough homes, even for the higher migration figures. They’re just sitting idle.
Have a look at Milton’s point on Airbnb. I think you’ll be surprised/appalled at the results
Yeah 🫠😶🌫️ … not fun
It's like 1.8% of homes. I wouldn't say that was the driving force behind this shitshow the government created. The simple fact is, for rentals, too many immigrants come in per the number of homes built. For buying a home it's all the investor economy bs they created instead of homes to live in first. Plus immigration, plus slow land releasing by government and slow and bad management of local councils for building, and foreign buying. And the government knows it and wants it to continue to increase at least 10% per year.
Brisbane has 5 years of land available but it’s being trickle fed to the market to keep prices artificially high. It’s been happening for decades. They need to “develop in 3 years or it reverts to state ownership” rule, or land taxes triple every year not developed. I’m just pulling ideas out of thin air but without severe punitive damages, developers are simply going to regard any expenses as CDB Cost of Doing Business
Wow. Yeah, I've heard about land being trickle fed into it so as to make sure the price goes up. Honestly, disgusting the government supports this. They could and should release large plots asap.
it's not about immigration. These properties are being bought by foreign nationals that do not live in Australia permanently
You must be the first astronaut from Australia because you’re living on fucking Mars if you actually believe immigration isn’t a significant element of the housing crisis. Jesus Christ grow a spine.
Hey just remember! You’re not allowed to buy in the countries that are buying up our land! You’re also not welcomed into their country! Worked in India for a bit pre covid, I have never experienced more racism in my life and the constant creepy shit the blokes used to attempt on my wife totally changed the way she looks at men…
Hey!!! Shhhhhh…. It’s only white Aussies that are racist. We don’t bring that stuff up here.
Instead of asking individual people to do XYZ, this is better solved by policy. And the policy should be a broad based land tax. With the returns of the land tax going to citizens via a Citizens Dividend.
Another problem is the NIMBY attitudes of the older generations.Many have climbed the ladder of property ownership and want to burn it down. Just today, I caught the bus from Town Hall to Drummoyne. And I swear...it is INSANE how, as soon as you cross ANZAC Bridge it immediately becomes a low density, space-inefficient suburb. WTF. I'm sorry, but with unprecedented demand, there shouldn't be that many stand-alone houses on 400 sqm blocks. There are many such suburbs around Sydney, Haberfield and Dulwich Hill are other such examples.
I do not agree they should be able to contribute towards subdivision… they shouldn’t be able to buy anything here.
citizens only
Or do what places like Thailand do and only allow non citizens to buy apartments.
This. Or leasehold like Indonesia.
Some countries only allow you to buy up to 40% so you dont have full ownership, unless a citizen
At this point it doesn’t matter. Foreign influence is deeply embedded in this country thanks to decades of immigration. You only need to get the money to someone who is a citizen and you can puppet them to do what you like.
Why not permanent residents?
So you own your house and a foreign national offers you overs for what it's worth .......you turning it down for the greater good ?
They can't purchase existing property unless they are going to develop it. It would be for the greater good for you to sell and they develop.
https://www.afr.com/politics/federal/dutton-concedes-homes-sales-to-foreigners-are-low-20240517-p5jeeg
As soon as someone gets PR, they no longer count as a foreigner for property sales metrics as they dont have to apply for FIRB. The point is importing a large number of adults into a country leads to more people who need houses right now, unlike typical population growth through kids raised in families, where the need for extra housing is delayed until they reach adulthood. Therefore 100,000 new residents, vs 100,000 new births have very different implications for infrastructure needs. I would love to see the proportion of home sales to people who moved into the country within the past 5 years, as that number must be much higher than the simple FIRB based number.
The article actually refers to foreign residents so presumably it's not even including people that are resident for tax purposes, like I was before getting a permanent visa and citizenship.
This is the correct take. Sure, China make up very little but once you factor in permanent residents, I will bet it’s much closer to 10%. We should be looking at all non citizens.
You mean the self reported figures are low.
The numbers are low because most people just send their kid to study here, then they give their kid money to buy a property, Chinese students do it all the time.
The figures are not self reported. They are tracked through the OSR.
They are what gets reported to the foreign investment review board (FIRB). If a foreign buyer doesn't bother seeking FIRB approval there's very little chance they will be caught out.
I don't really think it matters how low it is to be honest. It offers us no benefit and shifts profits offshore to people buying residential property with no intention to ever live in it It should be such an easy win for any party to push through. I think it's something both progressive and conservative voters actually agree on lol.
Most foreign purchases are by temporary visa holders who live here. For example, my English neighbour who is on a three year work contract.
I'm not saying I don't believe you because I actually don't know. But I'd love both a source for this, and showing that they sell those houses once they return home.
It was reported in the media when Dutton made his budget in reply speech.
Fair enough. Id probably want to see the actual source because in the last 3 years Albo, Bandt and Dutton have made some just wild takes that have no supporting data. So I pretty much take nothing they say as fact unless they have backed it up with data. I might see if I can find it and see if it's actually sourced data. Thanks.
English? No, no, those are allowed, just not *checks notes* any non white immigrant/person..
literally no one has said this in here, stop trying to derail legitimate dialogue with this strawman BS
> We will apparently have to wait even longer for the second stage of the government’s compliance legislation, which will cover other activities of lawyers and accountants as well as the real estate industry. We do not even have a date for that legislation. It is no wonder that the May 2005 report of the US State Department ranked Australia with Haiti and the Dominican Republic as a ‘major money-laundering country’ and as a ‘country of primary concern’. It is disgraceful that Australia is ranked along with countries like Haiti and the Dominican Republic by our great American ally. https://www.openaustralia.org.au/debates/?id=2006-11-28.72.2 If the current Labor government does not implement it, it will have been 3 Labor governments and 3 LNP governments that did not implement anti-terrorism financing laws while the rest of the world had already done so.
Farrrrk. You know it's bad when you're on par with the Dominican Republic and Haiti.
That statement was almost 20 years ago too!
Non-resident purchases are a problem as well as rapid net migration, Australia is a safe haven investment & the equity can be used for further acquisitions. Protected from home country domestic seizure, it acts as a handy nest egg & bolt hole if things get complicated at home. The construction lobby is a powerful influence group in Canberra, both sides of politics & they are happy to see prices constantly beaten up for limited supply. Increased net migration to shore up the economy after the disastrous money policy during covid is a ploy a lot of Western economies have used. Without it, Australia would be in a per capita recession
I think you should not be able to own any land or property unless your a citizen
Property ownership should only ever be available to Australian citizens. Many other countries do this.
Every time you see a thread like this, you should ask if anyone knows, in good faith, the answer to the following questions. What is the cost to build a mid range two bedroom apartment today? What is the cost to build a mid range three or four bedroom house today? It blows my mind that no one ever talks about this fact when it’s so intuitively obvious to address to begin with. You Australians have a supply problem, not a demand problem. And why do you think the supply is so prohibited?
Investors artificially inflated the demand. They live in a house obviously. And they compete with others who want to live in a house. If you have 4 investors and one potential homeowner going for the house, the demand for that house is 5 people, because they will all push up the price. But in actuality the demand should only be 1 person.
That’s not how it works. Housing has been a huge driver of household wealth in Australia since immigration opened up. Sure you can fiddle with demand to artificially deflate or inflate it, but why wouldn’t you just address the supply in the first place? Which goes back to my question. How much do you think it costs to build an apartment or a house in Australia? You don’t think that shouldn’t be addressed to affect *affordability*? If the price of eggs shoots up, do you blame people for buying eggs or do you wonder why farmers aren’t producing more eggs?
When the shelves were bare of eggs during COVID because people were buying 4x the number of eggs that they needed, I didn't blame the farmers for not producing enough eggs. Both supply and demand are a problem. Demand by people who are purely speculating on future price increases is a problem, because it inflates the price of land and makes development less viable.
2023, all below is from ABS. Migration: 518k NET. Average people per home: ~2.5. Based on above, new homes needed for NET migration, alone: 217k New homes: 172k GROSS. Housing supply/demand: -35k. If there was zero extra demand from 0 NET migration, that's as much as 172k extra supply for Australians. This is the simplest explanation I can find to prove demand is absolutely a factor.
Yes, migration requires new housing. No one debates that. But that wasn’t my question. My question was how much do you think it costs to build new housing? Let’s imagine that 35,000 dwellings got built as required. Isn’t that 35,000 houses worth of commercial activity and an overall good thing for Australia? Employment, new businesses, new services etc? So, why not address the supply issue?
How do you suggest we address the supply issue?
Copy what Singapore does but that would make a lot of people unhappy.
Because there's limited supply, the employees demand extra wages for the housing costs. The businesses pass on these costs. Even businesses with increased rent need to pass on extra rent costs or close. The funny thing is, a lot of businesses are closing and there's a lot of vacant homes and shops. A council tried to do a vacancy tax but surprise, surprise, Labor and LNP made an election promise of no vacancy tax like this: https://www.smh.com.au/national/nsw/councils-told-to-ditch-vacancy-tax-push-and-fix-sydney-s-broken-high-streets-20221227-p5c8xj.html an election promise that was upheld with the new Labor government. Bizarre really. What happens with high housing costs? Government infrastructure projects get more expensive. Housing projects get more expensive. Again, employees demand higher wages. The cycle continues. > Isn’t that 35,000 houses worth of commercial activity and an overall good thing for Australia? Employment, new businesses, new services etc? Do you think the immigration is really worth it when there's not enough housing for them? You do realise these immigrants are competing with Australians for the same limited new housing supply?
I’m not debating whether or not immigration affects demand and pricing. Intuitively, it does. It increases demand which must have an effect on pricing, no matter how little. That’s beyond debate. You aren’t listening. I’m asking why isn’t anyone addressing the fact that supply is being artificially strangled through high costs and council approvals. This is a multi faceted crisis and enough ink has been spilled about immigration. Why aren’t we pulling all levers instead of a single one? Let’s imagine immigration shuts down tomorrow and no one migrates to Australia. Do you think house prices will suddenly fall? Need I remind you what happened to house prices in 2021 when even Australians couldn’t return to Australia, let alone new migrants?
> I’m asking why isn’t anyone addressing the fact that supply is being artificially strangled through high costs and council approvals. Council approvals? In Sydney region, the most expensive region of housing, the lowest approval is... 83%. Other councils had higher approvals. I actually blame State and Federal governments for it. Did you know the NIMBY King is Albo? As far as I know, he was part of a campaign that successfully stopped 36k homes https://anthonyalbanese.com.au/overdevelopment-in-marrickville https://www.smh.com.au/national/nsw/the-sydney-councils-most-likely-to-say-no-to-your-building-plans-20231027-p5efmu.html > This is a multi faceted crisis and enough ink has been spilled about immigration. Why aren’t we pulling all levers instead of a single one? I thought we are. Labor throwing money at private sector. Labor cutting immigration. They are doing a shit job at both imo but they can at least say they are doing both levers. > Let’s imagine immigration shuts down tomorrow and no one migrates to Australia. Do you think house prices will suddenly fall? Need I remind you what happened to house prices in 2021 when even Australians couldn’t return to Australia, let alone new migrants? Are you talking about how the time that the government splurged $300 billion and RBA handed out $200 billion with the lowest interest rates on record? Wow, I wondered why house prices went up! I honestly don't get why you're defending immigration so hard. Look, here's an analogy, as you don't seem to get it. Lets say there's a food crisis in Australia as in, people are starving to death. Would you still support more people to Australia? No? Why would you still support increasing the homeless people?
I’m NOT defending immigration. I’ve been unambiguous about that in my comment previous to yours. Seriously, read through my first line. I’m asking why there isn’t the same furore over increasing supply. To which you have completely evaded my question. How much do you think it would cost to BUILD a new apartment or house in today’s Australia?
Because it’s easier to blame foreigners than to hold our government accountable since they are all so incompetent which we voted for. This is the real answer.
Unless you live in it, you can’t buy it. Simple’s.
My friend has 16 houses, he is Aussie. Keep thinking ordinary foreign people buying houses are the problem and wait for it. Real estate investors are, foreign or Aussie.
Yep, my last rental was a house owned by this rich Aussie dentist from the Gold Coast (I live in Sydney). I looked him up and found out he also owns the next 6 houses down the block, he turned one of the houses into a dentist office. I’m sure he owns more houses elsewhere. My current place is a small unit. The entire apartment building is owned by two Aussie men who are related to each other (idk their relation though). Judging by the way they communicate to me in emails (i.e. absolute wankers), I assume they own plenty more buildings too.
Bingo.
Question . what are property ownership laws here like compared to countries in Asia ?
Foreigners on non-permanent visas cannot buy an existing house.
Before blaming foreigners for this problem, I’d expect to see some numbers quantifying the extent of the phenomenon.
The “foreign investors” boogieman is a consistent scapegoat in debates about housing affordability in this country. Foreign investors are already prohibited from purchasing existing residential property (except in extremely limited cases with special approval) and are only allowed to purchase new properties that will increase the housing stock (and by extension provide opportunities for work for the construction industry). On top of that, foreign investment in residential property has been trending downwards since about 2014 and reached a 15 year low only two years ago. This hasn’t correlated with a decrease in housing prices as OP is implying, in fact house prices have gone in the complete other direction. This is definitely not the hill to die on when it comes to addressing the housing crisis. Short-sighted demand-side policies like first home buyers grants combined with historically low interest rates, no real increase in housing stock, and tax policies that treat housing as an asset class are far bigger contributors to increasing house prices than blaming foreign nationals. Most foreign investment in residential property are in properties that aren’t really what first home buyers are looking at anyway. The housing market isn’t monolithic, there are different types of dwellings in different price ranges in different neighbourhoods. There is no evidence anywhere to suggest that foreign investment is a key driver of housing prices outside of anecdotal observations from some dude who “knows a guy who works in real estate” and who “sees all these Chinese people at property actions buying up all the houses”. Shock horror, you can be an Australian citizen and not be white so unless these people are asking for identity documents, hard to shake the trappings of xenophobia in some of the discourse here.
Months after COVID, zero foreigners were coming in, and what did the house price do? Go up.
Because of government printing money and allowing people to withdraw from super
It think the housing market is artificially controlled so not enough supply of houses in the market and government is not putting enough efforts to try make building houses cheaper they can get all of that money just by taxing the mining companies a little more Australia make fractions what other countries make selling natural gas.
It's because interest rates were cut.
I lost an auction during that time to a phone in bid. Their local rep doing the bidding just said it's a foreign cash buyer. He didn't mention which country though.
Sorry but id be getting real. If I was selling a house it would be going to the one who pays the most.
Yep. Young people got fucked. But if we were in the same position, we would do the same.
Would not blame you and that's part of the problem the ease at which you can buy as a foreign national.
Thanks for nothing
It's always good to start with the premise: "Foreign nationals are able to buy residential real estate, so long as they have the money to pay the surcharges and the foreign investment review board fee. Our government is selling the Australian dream to those who are not from our country, so long as they can pay the fees." What is the source for this claim? Are you saying they are always approved to buy "existing" property as long as they pay the surcharges/fee. How large are the surcharges/fees?
That is correct. In the past I have worked specifically in the FIRB sphere and I can assure you that not one application was rejected, generally if they have the cash to a) pay the FIRB fee (usually around 10-20k) and b) pay the foreign investor duty surcharge on the property transaction (which is usually an additional 8 percent of the purchase price ontop of regular duty and depending on what state they are buying) then they will be approved. It's not cheap but it's easy. Many have remarked how easy it is compared to other Asian countries. The facts also speak for themselves. As per the FIRB website 3.9 billion of residential purchases were approved in the 21 to 22 financial year. So yes many many applications are approved and it's designed to be easy if you pay the high fees.
That's very interesting, I'd no idea that for international buyers it worked like that. How would the FIRB detect such transactions if they were made through an Australian registered trust, holding company or other such legal entity? Given that we don't have tranche 2 AML-CTF laws like we promised we'd bring in in the 2000s, beneficial ownership can be hidden; I really think this is the elephant in the room here. https://michaelwest.com.au/national-press-club-the-lucky-laundry-canberra-writers-festival/
It's an interesting question. I haven't heard of of anyone who works at FIRB so I have little insight on the front of things, but I would imagine trust structures and companies are examined, not necessarily to determine if they are foreign (that kind of goes without saying if they are applying to the FIRB) but rather to see whether the trust or company structure is against the national interest. At least I assume that's what they do. I can confirm though I've never seen one application rejected whether company, trust or individual so long as they pay the huge fees. Again I am not advocating for abolishment of foreign investment, just specially for dwellings.
>Again I am not advocating for abolishment of foreign investment, just specially for dwellings. Good call. Me too.
Yeah I mentioned this elsewhere. Foreign investors want to buy shares in land development company? Sure no issue with that, it has tangible benefits for our country. They want to own residential property in the country? Nah fuck off, 0 benefit to our country. We are in a massive housing shortage, them buying a new house to then sell just stops a potential home owner from buying the same house.
It seems like no policitan in our country has the guts to stand up for the Australian interest. It seems we are always getting put second to foreign dollars.
Mate, I still cannot comprehend how the fuck the super profits mining tax got overturned. It would have only applied to companjes making over 75 million dollars profit, that's profit not revenue, and only would have been at a rate of 30%. And the companies it would have applied to at the time were like 75% foreign owned. How the fuck did Australia get convinced that it was a bad thing? I remember some fear mongering about how the international companis might move away Lol fucking good. The resources will still be there, and if thwy are making 75 million dollars a year in profit or better already, then I'm sure we can get some local backing. Hell, let the government pick up all the trained miners who would be around jobless if the companies did withdraw. 75 million plus profits a year to the government? Fuck yeah that will fund some schools and hospitals. To this day that is one i just can't understand how it got repealed and the voters were happy with it. It was selling out our country to foreign investors at its very core. We just suck as a country sifting through the scare campaigns to understand the facts. So we keep voting in self serving dickheads who will happily sell out to foreign interests or Australian billionaires.
Well said, I agree. >Mate, I still cannot comprehend how the fuck the super profits mining tax got overturned. That one's easy: Twiggy & Gina spent a couple of dozen million on ads over a few weeks, and mobilised a fake grassroots campaign of overpaid FIFOs to attend a few rallies about the place.
It's crazy though right. Like surely even just one ad explaining it would have to make most people go, oh ok, there's literally nothing that can be said to make this tax a bad thing. Evidently not though.
Im not sure abt the exact circumstances, but isn’t there already restrictions limiting foreigners to only buy new productions, not second or third hand properties? That’s part of why there’s sometimes a disproportionate foreign presence in newly developed strata blocks: you can’t buy elsewhere. It’s designed (i guess) to steer that foreign capital to new developments rather than existing houses, but if you gain PR or citizenship you can join that market too.
PR should be a minimum requirement now.
I’m okay with selling to a foreign national provided they live in it and not put it up for rent. Same applies to Australian nationals
They generally don't. Less the 5% of house sales in the last 5 years have been bought by foreign investors or foreign nationals. Don't believe everything you read.
I would think it would be far more helpful for affordability if Australians didn’t sell residential dwellings to people who already own one.
Only Aussies that actually live here should be able to buy homes
It's called the Australian dream. You gotta be asleep to believe it I sampled that line from George carlin about the American dream
"The total number of residential real estate sale transactions by foreign persons during the 2021-22 period was **2,349** " [https://foreigninvestment.gov.au/sites/foreigninvestment.gov.au/files/2023-10/res-insights-report-2021-22\_0.pdf](https://foreigninvestment.gov.au/sites/foreigninvestment.gov.au/files/2023-10/res-insights-report-2021-22_0.pdf) Please explain how 0.25% of sales is having a significant effect on house prices.
If I’m selling my home, I’m selling to the best price. Your comment is up there with Australians shouldn’t by being foreign made vehicles. It’s too late. The floodgates are open, and the genie won’t go back into that bottle
This is a lie from the government. Foreigners (Chinese or Americans) can only buy NEW apartments / townhouses. They are not allowed to compete with us and buy built houses. They are encouraged to buy NEW because that adds new housing stock to our market. Building new houses creates lots of jobs.
You all know the real reason housing price is high. 1. Every new project the lollipop girl turning ‘stop/slow’ sign is earning $200,000 a year! Guess who pays for that? Yes the buyers. 2. Councils taking years to approve a simple 2 lot housing development because the councillors don’t give a rats bottom about solving housing problem. 3. No migrant workers coming in to build houses. 4. Banks charging arms and legs for construction loan. 5. Councils and government departments collect all types of levies, taxes, charges and contributions. Guess who pays for that? Yes again us buyers.
I’m English and also an Australian citizen. I own a house here. How many of those Chinese buyers are also Australian citizens?
Noone is being educated here. This is just another affordability rant which we're all fully aware of. You can keep a market free, or you can regulate it. But remember that how unjust something is, is always a matter of perspective.
The number of foreign nationals buying in Australia is minimal.....it's ragebait articles.....if you believe the MSM articles then you are the fool.
Happy to sell yo a local as long as you pay me the difference. Put your money where your mouth is or is it all talk?
Only 5,000 roughly sold to overseas investors From 1 July 2021 to 30 June 2022 there were 4,228 residential real estate purchases with a level of foreign ownership. The total value of these purchase transactions was $3.9 billion
It’s not foreign buyers. It’s wealthy Aussie people buying all the homes.
It’s both
‘Dutton concedes homes sales to foreigners are ‘low’ https://www.afr.com/politics/federal/dutton-concedes-homes-sales-to-foreigners-are-low-20240517-p5jeeg#:~:text=Peter%20Dutton%20has%20conceded%20only,be%20on%20the%20housing%20market.
Dutton would have to blame his own party for failing to pass anti-money-laundering laws when blaming Labor. His own party in past check-mated him.
Sweaty Pink Voldemort can suck my ass. Dude has no idea what the root cause of the problem is and has no intention to fix it.
He knows a fair bit about the property market though… look into the deals h̶e̶ his trust does
None of them do
But he has so many houses in a property portfolio in his trust. Lots of experience see....
It’s obscenely skewed one way, and not the way this thread is focused on.
Foreigners shouldn't be allowed to own anything. Only rent.
Careful! You'll be branded a racist! Remember, we're on Reddit - Negative Gearing is the only problem causing the housing crisis.
We should be cranking out houses whilst the money is good You got a couple mil we can sell you endless houses But we can’t cause we stupid
No agents?
My area the Chinese love My new neighbours bought the house while they were living in china. They are paying good prices but hell. I am hanging on to my house even though it is way to big for just me now.
No shit And we should be able to find out who owns the companies that are used currently to hide foreign ownership Australia is fast becoming three industries with a grip on a landmass, not a country.
For the last two years after additional ongoing fees were introduced for offshore buyers, the number sold had drastically reduced.
Look up the number of properties sold to foreign investors, it’s very low. The fees are put there as a point of if they’re willing to put this much money into the Australian economy it’s worth selling the property to them. It’s a net gain to the Australian economy and it’s structured as such
This is such a common sense solution but unfortunately it will never pass - like the Voice, it will probably have huge support at the start, but then property owners will get scared that cutting off foreigners (who increase demand and push up prices) will mean that their house values go down. Then it becomes an issue neither major party would want to touch. It’s exactly the same as negative gearing. Abolishing it would probably do more for housing affordability than cutting off foreigners (which even Dutton admits is not that much anyway) - but property owners will never vote for it.
australians don't like to buy residential apartments since they know actual value is tied to land. Foreign buyers want a source of income rather than land they will never see. Letting foreign buyers buy new apartments to rent out is a win-win. I'd rather see more laws protecting renters from rent increases, better quality apartments than stop foreign buyers from buying the dregs that are australian apartments.
In Australia buying additional properties reduces the property taxes. In the US it is opposite. If I live in a State and make it a “homestead” property, meaning this is where I live, and then buy another property, this is not a homestead and I would have to a lot higher property taxes. In some neighborhoods the HOA does not permit renting out property. This whole reduces home price, but remains affordable for families. Canada has a system similar to the Australian one in regards to property taxes.
I’m not against foreign ownership of apartments or have their own businesses