One of the few good outcomes from Monday’s National Press Club speech by Prime Minister, Tony Abbott, was his assurance that the Government would implement the recommendations from the parliamentary inquiry into foreign investment in Australian real estate, which among other things recommended:
- Improving the internal processes at Treasury and the Foreign Investment Review Board (FIRB) and removing barriers to enable adequate audit, compliance, and enforcement of the foreign investment framework.
- Applying a modest administrative fee to the current screening of foreign purchases of residential real estate to better resource FIRB audit, compliance and enforcement activities.
- Introduction of a civil penalty regime for breaches of the foreign investment framework, including for third parties that facilitate such activities (e.g. lawyers and real estate agents).
- Amending Australia’s Foreign Investment Policy to explicitly require a temporary resident to divest an established property within three months if it ceases to be their primary residence.
- Establishing an alert system for the expiry of temporary visas to ensure homes are divested.
- Establishing a national register/database of land title transfers that records the citizenship and residency status of all purchasers of Australian real estate.