How to Get FIRB Approval for Buying Property in Australia
How to Get FIRB Approval When Buying Property in Australia
The Foreign Investment Review Board (FIRB) is an Australian Government advisory board that examines the purchase of residential or commercial real estate by non-citizens, non-permanent residents, or non-approved migrants. Reviewing foreign investment ensures that it benefits the economy of Australia and controls stock within the property market. Often, foreign investors have limitations in investing only in new properties to prevent speculation from inflating local property values.
If you are considering buying property in Australia, it’s possible you will need FIRB approval if you are a temporary resident or foreign investor.
Foreign Investors: You may need to obtain FIRB approval as a foreign investor purchasing property in Australia. The investment property must be a new property or vacant land where development is proposed. If you are an overseas citizen residing outside Australia, it is unlikely you will be permitted to purchase property without a valid visa.
Temporary Residents: Unless you are on a temporary visa, such as a spouse visa, 457 visa, or student visa, FIRB approval will likely be required. In this instance, you must inform the FIRB of your intention to acquire a property. Temporary residents are defined as those holding a temporary visa or a bridging visa with an application for permanent residence.
If you buy a live-in residential property, you are permitted to acquire only one property and will be required to sell it if you no longer reside there. However, if you obtain Australian citizenship or permanent residency, this requirement is waived. Temporary residents can purchase an investment property, but it must be a new property or vacant land from a developer. No FIRB approval is needed if purchasing with an Australian resident as joint tenants.
Application Process: Any investment in Australian real estate requires correct paperwork and an accepted application. Briefly, the steps involved before filling the application include:
- Statement of Significant Actions: Explain the proposed actions under the Foreign Acquisitions and Takeovers Act.
- Entity Details: Information about the entity undertaking the transaction.
- Transaction Information: Business reasoning, description of purposes, timing, sale process information, and a diagram of steps.
- National Interest: Reasons the transaction meets Australia’s national interest and foreign investment policy.
- Applicant and Ownership: Details including country of origin, percentage ownership, and related foreign investors or managers.
- Structure Diagram: Direct and indirect holding entities and target group structure.
- Financial Statements: Audited financial statements for the last financial year or the latest period.
- Acquisition Details: Information on any acquisition by buy-back, unit redemption, or capital reduction.
- Land Information: Title details, map, land extent, consideration for titles, size, current usage, and proposed business plan.
- Additional Information: Patents, royalties, export franchises, licensing arrangements, regulatory approvals, post-implementation equity and debt instruments, and other relevant financing details.
Once the entire application is prepared, it can be lodged directly with FIRB.
Timeline of Decision: The Treasurer has 30 days to decide, extendable by written letter to 90 days, and further to 90 days if the order is interim. The maximum period for approval is 210 days (nearly seven months). Notification of the decision must be provided within 10 days from the decision date.
It is an opportune time for foreign investors to invest in Australian property, with the market growing and supportive government policies. The right real estate agent will be crucial upon approval of your FIRB application. The Australian real estate market can be overwhelming for foreign investors. Create Real Estate offers professional advice and tailored service to help you find the ideal property and succeed in your investment in Australia’s booming real estate market.
For more information, visit Create Real Estate.