Following on from yesterday’s agreement to all of the recommendations arising from the House of Representatives Inquiry into Foreign Investment in Australian Real Estate, AAP is reporting that Treasurer Joe Hockey will introduce legislation into parliament today to give effect to the new laws.
Included in the new regime will are:
- Tougher penalties for non-compliance, including stripping investors of any capital gain made when they’re ordered to sell their homes, and fines of $135,000 or three year’s jail for individual’s that break the rules, as well as third parties that assist in breaking the rules; and
- Establishment of a centralised register to track foreign ownership, along with better data matching systems across regulatory agencies.
Speaking on 3AW radio, Treasurer Hockey told listeners that foreign investors have until November 30 to sell their properties under an “amnesty” or face hefty fines, and admitted that the tougher regime could lower house prices:
“In the last few weeks I’ve announced the forced sale of seven properties,” he said on 3AW Mornings.
“We are investigating 462 and I can tell you 207 investigations are underway in Victoria which is the highest in any state.
“What’s happened is some foreigners have either bought existing real estate and they are not allowed to do that, or they have got permission to buy existing real estate and when they have left the country they haven’t sold them and they have to do that.
“What we did was set up an amnesty and they’ve got until the 30th of November to notify us.
“After November 30 we will claim any capital gain they have made or 25 per cent of the value of the property.”
Neil Mitchell said there could be “tens of thousands of houses sitting around illegally owned” and questioned what would happen when they go on the market.
“It might bring down the price of real estate for people,” he said.
Well done Joe Hockey.
