Australia will impose a two-year ban on foreign buyers purchasing existing homes to increase housing availability for local buyers. The policy will start on April 1, 2025, and run until March 31, 2027.
Treasurer Jim Chalmers and Housing Minister Clare O’Neil announced the decision, aiming to reduce pressure on the housing market. Under the ban, foreign investors, including foreign-owned companies and temporary residents, cannot buy established homes. However, the ban won’t apply to new developments with 20 or more properties.
Foreign buyers spent $3.1 billion on 5,360 residential properties in 2022-23. This represents less than 1% of all sales, according to the Foreign Investment Review Board.
Minister O’Neil stated that the ban would not solve the housing crisis overnight, but it would free up thousands of homes for local buyers. This move is part of broader efforts to improve housing access for Australians facing rising property prices.
Interestingly, Opposition Leader Peter Dutton proposed a similar plan last year in his budget reply. Some view the government’s action as an effort to address concerns about housing affordability.
However, some economists believe the ban will have a limited impact. Foreign buyers only own about 2% of Australia’s housing stock, and the ban might not significantly alter the overall market.
It remains to be seen whether this policy will bring about the changes needed to improve housing availability in Australia.
