Andrew from Vista Financial

Changes for Temporary residents buying property/land

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    Hi

     

    Thought I would post this as it will be relevant to quite a few people.

     

    Below is taken from the FIRB website, probably the most appropriate point is that no FIRB approval will be required for temporary residents wishing to buy a residential home established or new from February 2009 (subject to amendments)

     

    CHANGES TO FOREIGN INVESTMENT POLICY – RESIDENTIAL REAL ESTATE

     

    FROM 18 DECEMBER 2008 THE POLICY HAS CHANGED AS FOLLOWS:

     

    Temporary residents purchasing second hand dwellings

     

    The definition of ‘temporary resident’ includes all foreign persons living in Australia on a valid visa, irrespective of the expiry date of that visa. This includes people on bridging visas pending the outcome of a substantive visa application (eg if they have applied for permanent residency) but, for example, does not include short-term visitors such as tourists, business people and those here for a medical procedure.

    Foreign students resident in Australia are no longer subject to a $300,000 limit on the value of an established dwelling purchased as their principal place of residence.

    Vacant residential land

     

    Acquisitions by foreign-owned companies, trust estates and non-resident foreign persons of single blocks of vacant residential land are required to build a dwelling within a period of 24 months (previously within 12 months and development expenditure of at least 50 per cent of land cost).

    The conditions previously applied to acquisitions by temporary residents of single blocks of vacant residential land no longer apply (such acquisitions will be exempt after the Regulations are amended in early 2009).

    ‘Single blocks’ of vacant land generally refers to a block of land on which only a single dwelling could be constructed. This does not include large tracts of land (eg for the purpose of subdivision) or multiple adjacent single blocks (eg to develop a multi-dwelling apartment complex) – additional development conditions may apply to such acquisitions.

    New dwellings

     

    The existing requirement that only 50 per cent of new dwellings can be sold to foreign persons on an ‘off the plan’ basis has been removed provided developers market locally as well as overseas. Vendors are no longer required to have concurrently developed a similar dwelling in order to be able to sell a new stand-alone dwelling to a foreign person. This will be reviewed after two years.

    A ‘new dwelling’ is currently defined as having never been occupied or sold; this now includes dwellings that have not been sold but that have been rented out for no more than 12 months.

    Foreign companies purchasing second hand dwellings

     

    Foreign-owned companies can now purchase established dwellings for the use of their Australian based staff provided that they sell or rent the dwelling if it is expected to remain vacant for more than 6 months. There is no limit to the number of established dwellings which can be purchased, where required for employee accommodation.

    Redevelopment of second hand dwellings

     

    A proposed redevelopment must increase the number of dwellings and no rental income can be obtained from the existing dwelling prior to demolition. Such redevelopments are required to demolish the existing dwelling and commence construction of the new dwellings within 24 months in line with vacant land (previously 12 months), and development expenditure must be at least 50 per cent of the purchase price of the property.

    FROM FEBRUARY 2009 – SUBJECT TO AMENDMENTS TO THE REGULATIONS:

     

    Temporary residents’ exemption

     

    Temporary residents will not be required to notify proposed acquisitions of:

    PicExportError an established dwelling for their own residence (not for investment purposes);

    PicExportError any new dwellings; and

    PicExportError single blocks of vacant residential land (other acquisitions of vacant land will require notification and will normally be approved subject to development within 24 months).

     

    The exemption will include acquisitions of property by temporary residents via their wholly owned trust or Australian incorporated company.

    The existing notification requirements will continue to apply to non-residents, who must notify all proposed acquisitions of residential real estate.

    Accommodation facilities

     

    Accommodation facilities such as resorts and hotels will be treated as commercial real estate rather than residential real estate. Acquisitions of such facilities – or individual units within them – valued below the relevant developed commercial property threshold ($5 million for heritage listed property, $50 million for non-heritage listed property or $953 million for US investors) will be exempt from the FATA and will not require notification and approval.

     

    Streamlined administrative procedures

     

    Streamlined administrative procedures will be established for foreign-owned companies, trust estates and non-resident foreign persons to notify and receive approval for proposed acquisitions of vacant residential land and newly constructed dwellings. New application forms and statutory notices will be introduced to facilitate the streamlined procedures.

    Developers will no longer be issued advance approval for sales of new dwellings to foreign persons – all non-resident foreign purchasers must submit individual applications (although developers may submit these on behalf of the purchaser/s). Temporary residents will be exempt and not required to notify.

    Regards

    Andy

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    Guest Lulujim

    Wow that's good news - now all we need is to be able to get the First Buyer's Grant etc - do you think this is the first stage in Temporary Visa holders being treated same as PR ones? :jiggy:

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    Guest rockpool crab

    Hi there,

     

    Great news Andrew, one less thing on the preverbial "to do" list....happy days :-)

     

    Carol Ann

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    Guest redfoxy
    Hi

     

    Thought I would post this as it will be relevant to quite a few people.

     

    Below is taken from the FIRB website, probably the most appropriate point is that no FIRB approval will be required for temporary residents wishing to buy a residential home established or new from February 2009 (subject to amendments)

     

    CHANGES TO FOREIGN INVESTMENT POLICY – RESIDENTIAL REAL ESTATE

     

    FROM 18 DECEMBER 2008 THE POLICY HAS CHANGED AS FOLLOWS:

     

    Temporary residents purchasing second hand dwellings

     

    The definition of ‘temporary resident’ includes all foreign persons living in Australia on a valid visa, irrespective of the expiry date of that visa. This includes people on bridging visas pending the outcome of a substantive visa application (eg if they have applied for permanent residency) but, for example, does not include short-term visitors such as tourists, business people and those here for a medical procedure.

    Foreign students resident in Australia are no longer subject to a $300,000 limit on the value of an established dwelling purchased as their principal place of residence.

    Vacant residential land

     

    Acquisitions by foreign-owned companies, trust estates and non-resident foreign persons of single blocks of vacant residential land are required to build a dwelling within a period of 24 months (previously within 12 months and development expenditure of at least 50 per cent of land cost).

    The conditions previously applied to acquisitions by temporary residents of single blocks of vacant residential land no longer apply (such acquisitions will be exempt after the Regulations are amended in early 2009).

    ‘Single blocks’ of vacant land generally refers to a block of land on which only a single dwelling could be constructed. This does not include large tracts of land (eg for the purpose of subdivision) or multiple adjacent single blocks (eg to develop a multi-dwelling apartment complex) – additional development conditions may apply to such acquisitions.

    New dwellings

     

    The existing requirement that only 50 per cent of new dwellings can be sold to foreign persons on an ‘off the plan’ basis has been removed provided developers market locally as well as overseas. Vendors are no longer required to have concurrently developed a similar dwelling in order to be able to sell a new stand-alone dwelling to a foreign person. This will be reviewed after two years.

    A ‘new dwelling’ is currently defined as having never been occupied or sold; this now includes dwellings that have not been sold but that have been rented out for no more than 12 months.

    Foreign companies purchasing second hand dwellings

     

    Foreign-owned companies can now purchase established dwellings for the use of their Australian based staff provided that they sell or rent the dwelling if it is expected to remain vacant for more than 6 months. There is no limit to the number of established dwellings which can be purchased, where required for employee accommodation.

    Redevelopment of second hand dwellings

     

    A proposed redevelopment must increase the number of dwellings and no rental income can be obtained from the existing dwelling prior to demolition. Such redevelopments are required to demolish the existing dwelling and commence construction of the new dwellings within 24 months in line with vacant land (previously 12 months), and development expenditure must be at least 50 per cent of the purchase price of the property.

    FROM FEBRUARY 2009 – SUBJECT TO AMENDMENTS TO THE REGULATIONS:

     

    Temporary residents’ exemption

     

    Temporary residents will not be required to notify proposed acquisitions of:

    PicExportError an established dwelling for their own residence (not for investment purposes);

    PicExportError any new dwellings; and

    PicExportError single blocks of vacant residential land (other acquisitions of vacant land will require notification and will normally be approved subject to development within 24 months).

     

    The exemption will include acquisitions of property by temporary residents via their wholly owned trust or Australian incorporated company.

    The existing notification requirements will continue to apply to non-residents, who must notify all proposed acquisitions of residential real estate.

    Accommodation facilities

     

    Accommodation facilities such as resorts and hotels will be treated as commercial real estate rather than residential real estate. Acquisitions of such facilities – or individual units within them – valued below the relevant developed commercial property threshold ($5 million for heritage listed property, $50 million for non-heritage listed property or $953 million for US investors) will be exempt from the FATA and will not require notification and approval.

     

     

    Streamlined administrative procedures

     

    Streamlined administrative procedures will be established for foreign-owned companies, trust estates and non-resident foreign persons to notify and receive approval for proposed acquisitions of vacant residential land and newly constructed dwellings. New application forms and statutory notices will be introduced to facilitate the streamlined procedures.

    Developers will no longer be issued advance approval for sales of new dwellings to foreign persons – all non-resident foreign purchasers must submit individual applications (although developers may submit these on behalf of the purchaser/s). Temporary residents will be exempt and not required to notify.

     

    Regards

     

    Andy

     

     

    Andy,

     

    Thanks for that info. Could you please make it clear and simple the procedure and rules about getting the first time buyers grant ? if a person is here on a SIR 495 temp visa can they purchase during the second year and then once PR is acheived claim the furst time buyers grant back ??

     

    Thanks Lynne

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    Hi Lynne

     

    As long as you apply within 12 months of entering in to the contract and you are PR at time of applying for the Grants then yes.

     

    Also the amount that you get is based on what the Grant amounts were when entering into the contract.

     

    So for example.

     

    If a temp visa holder purchased a property in January 2009 they then attained PR status in September 2009 they could apply for the Grants as it is within 12 months.

     

    In Sep 2009 if the Grants have reduced back to pre Oct 2008 i.e $7,000 they would still be entitled to the Grant amount as was at January 2009 date of contract i.e $14k est or $21k new.

     

    So effectively eligibility can be backdated for 12 months and the amount the grant is based on is also backdated to contract date.

     

    Andy

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    Guest redfoxy
    Hi Lynne

     

    As long as you apply within 12 months of entering in to the contract and you are PR at time of applying for the Grants then yes.

     

    Also the amount that you get is based on what the Grant amounts were when entering into the contract.

     

    So for example.

     

    If a temp visa holder purchased a property in January 2009 they then attained PR status in September 2009 they could apply for the Grants as it is within 12 months.

     

    In Sep 2009 if the Grants have reduced back to pre Oct 2008 i.e $7,000 they would still be entitled to the Grant amount as was at January 2008 date of contract i.e $14k est or $21k new.

     

    So effectively eligibility can be backdated for 12 months and the amount the grant is based on is also backdated to contract date.

     

    Andy

     

    Thank you for that Andy,

     

    So great care needs to be taken with the time frames of entering into contracts and the soonest date at which we can apply for PR.

     

    Thanks for you help

     

    Lynne

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    Guest covfan71
    Thank you for that Andy,

     

    So great care needs to be taken with the time frames of entering into contracts and the soonest date at which we can apply for PR.

     

    Thanks for you help

     

    Lynne

     

    So basically we need to wait until the second year to purchase a house in order to claim the grant back.

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    Guest caoimhe
    So basically we need to wait until the second year to purchase a house in order to claim the grant back.

     

    yep thats right and I only know this cause I spoke to Andrew on the phone and clarified this.

    Problem is do all of us on a temp visa want to hold out to get the grant after being here a year or buy now, if we buy now we may make that noney in equity in a year, Murphy's law as we say Ireland:biglaugh:

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    Does anybody know if there is any change on the mortgages granted for 475 visa holders, ie, can we still only get a 70% mortgage??

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    Guest caoimhe
    Does anybody know if there is any change on the mortgages granted for 475 visa holders, ie, can we still only get a 70% mortgage??

    PM Andrew Williams he can really fill you in on the differences between UK and OZ

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    Guest covfan71
    yep thats right and I only know this cause I spoke to Andrew on the phone and clarified this.

    Problem is do all of us on a temp visa want to hold out to get the grant after being here a year or buy now, if we buy now we may make that noney in equity in a year, Murphy's law as we say Ireland:biglaugh:

     

    Exactly, it will probably cost you about $15k in rent anyway for the first year.

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