Tony Abbott continues to make all the right noises on foreign property investment, backing-up his recent assurances that the Government would implement the recommendations from the parliamentary inquiry by ordering Treasury to force immediate sales on foreign property investors. From The Daily Telegraph:
The crackdown will be directed though an elite audit and compliance unit which will be tasked with finding illegal investments and forcing immediate sales…
“If it comes to our attention that someone has bought a property that they are not legally entitled to buy then our intention is issue divestment notices,” the PM said…
“Not once in the last six years of the previous government were these rules enforced,” Mr Abbott said.
“A succession of Labor treasurers were asleep at the wheel.
“In the next couple of weeks you can expect to see more from us in regards to residential land. We want housing to be affordable … we appreciate that if there is illegal competition that is obviously going to make it much more difficult.”
The parliamentary inquiry’s recommendations to improve the surveillance/enforcement of foreign property investment will go before Cabinet within the next two weeks are are widely expected to be endorsed, thus ending the open slather approach that has existed since the Rudd Government opened the sluice gates to foreign buyers during the GFC.
While there will always be loopholes, the reforms should put an end to a large portion of foreigners buying-up Australia’s pre-existing housing stock, inflating housing and land costs, and shafting first time buyers in the process.
They should also assist in lowering the dollar as it acts as an additional prudential headwind to prevent the RBA rate cut campaign from inflating housing further.
In short, it’s a perfect example of good public policy contributing to equity, market transparency, macroeconomic consistently and national welfare, and the Abbott Government should be congratulated.