The Australian government has enforced regulations with regards to foreign buyers purchasing property. This is after residents voiced concerns over the impact of foreign nationals buying homes and increasing property values. The Australian government wish to ensure that any sale to a foreign buyer is going to benefit the community or is in keeping with the community’s needs. Therefore, those wishing to buy a home must follow the strict regulations as laid out under these new guidelines.

Anyone wishing to buy a property if they are not permanent residents need to submit an application to the Foreign Investment Review Board (FIRB). You also need to apply if you are buying the property as a joint ownership with someone who is a legal resident of Australia. In this instance there is usually no problem but an application must still be made.

The application should be processed within 30 days and you will be advised if it has been granted or denied. You also need to submit an application for each individual property that you wish to purchase. If you are granted the request on one property then change your mind and wish to buy another, you must go through the process again. You must also state when you show an interest in a property that the sale would only go ahead with the FIRB approval, that way the vendors know the purchase is conditional and there will be a 30 day delay period while you seek the approval.

To satisfy the conditions for the FIRB approval you will need to prove that you are not buying the property to just rent it out. If you can show that your intention is to move to Australia in the near future then you are more likely to be granted the approval than if you cannot. This is because they will not want you to buy a property with the sole intention to make money, either in rental from tenants or from the resale value in the future. There is often a limit to the value of house that can be purchased also so that must be clarified prior to purchase to avoid disappointment.

If you are wishing to buy a property off plan from a developer, then it is up to the developer to apply for the FIRB. Once the property has been built then it can be rented out by the owner, lived in, or sold on, however the owner sees fit. As a foreign buyer you must ensure that the developer has this approval from the FIRB prior to purchase. Buying a home in a development or complex this way usually comes with regular maintenance payments (weekly, monthly or annually). These are to cover works to be done on the property, such as landscaping, maintenance of communal areas, such as lighting in hallway outside apartments and decorating. The more facilities your development has such as swimming pools and gyms will mean higher maintenance costs.

There will also be restrictions to this type of property too. Some will not allow pets, or only small pets such as cats. In developments that have communal laundry facilities, it may be that you are only allowed to use these facilities within certain times of the day, and there may also be restrictions on what colours you can use to paint your property. These maintenance charges and restrictions should be clearly outlined prior to purchase so you fully understand what you are agreeing to ahead of time.

Open houses are a popular way to view homes for sale in Australia. Open houses are when the home for sale is open to all members of the public who are interested in purchasing the house to have a look around and get a feel for the home. For those who are new to the area spending your time viewing homes in this way is also a good way to get to know the area and the types of property available within your price range.

If you have been granted permanent residence status then the house buying process should be much easier. As in the UK there are searches to be performed on the house prior to purchase. You should get an independent valuation prior to making an offer on the house. You are also wise to get a building inspection and get a pest inspection report also.

If you still want to proceed with the purchase you must first make your offer on the house. It is common for houses in Australia to be sold by auction. They are also sold by being offered at a list price as is more common in the UK. If you are making an offer on a home that has been listed with an estate agent, then the agent will give your offer to the vendors in writing along with all other offers received on the home. The home remains on the market and it is not customary to mark it ‘under offer’ as is the usual practice in the UK. The offer is then accepted, declined or countered by the vendor, but once an agreement is in place this will form a binding contract for both parties. If you have stipulated that there are conditions to be met before purchase and these conditions are not met then you can withdraw your offer. If all goes smoothly then a 10% deposit will be required with the final balance of the purchase price to be paid on the day of completion. From that moment the house is legally yours.

In the UK, selling your home via an auction is usually done because it will not sell any other way, in Australia that is not the case. Auctions take place both at the home or at the auctioneers room and are a way for the vendor to sell the home at hopefully a higher price, as bidders are competing with each other. Often a reserve price is set that in the event of this price not being met then the vendor does not need to sell the home. If you win the home at auction then you must pay your 10% deposit immediately. The balance is due on completion but if for any reason you drop out and the purchase does not go ahead you will lose your deposit.

Each state operates differently with regard to the legal paperwork and transferring the house ownership from one party to another, so you must seek legal advice from a lawyer practicing within the state you are looking to buy in. To find a lawyer that handles property sales you can consult the website of the Law Council, which has a handy search facility.