It’s easy to see why people from all over the world are flocking to invest in the Australian property market. Why invest in real estate you ask. Property has long been a measure of wealth and is a proven method to grow wealth. Wealthy people use property as the cornerstone of their investments. Why? Real Estate is a win win investment, it will grow in value, you can control it, plus it has great tax incentives. In Australia, the value for residential property have generally maintained their value whilst other countries have suffered huge losses. Population growth and strong prices have led to increased demand from the rental sector.

Latest figures show that nearly 80 billion dollars was spent by overseas investors into the Australian Property Market, the majority of which came from the UK.

This does not mean the average Aussie is missing out. Being an Australian citizen obviously has advantages over a foreign investor. An Australian citizen is able to move quickly when an opportunity arises. They are also able to buy any type of real estate anywhere they desire. Whilst it is obviously desirable for foreigners to invest in Australian property there are certain criteria to satisfy.

Requirements of Foreign Investors

The Foreign Investment Review Board (FIRB) has set down some strict guidelines that need to be adhered to by foreign investors. A foreign investor must notify the Australian Government prior to purchasing any residential real estate in Australia, be it a home or vacant land (New Zealand residents are exempt from this).

A foreign buyer can buy an established home for themselves to be used as their own residence. They cannot buy an established property for rental/investment purposes. If this home ceases to be the principle place of residence in Australia or is empty for more than 6 months of the year it must be sold.

If a foreign buyer wished to purchase real estate with the view to growing an investment portfolio they may only do so following certain criteria. They must sign a contract that includes a clause advising that the purchase is subject to approval by FIRB. The Treasurer has 30 days to consider the application. In some cases an extension period of up to 90 days may be imposed by publishing an interim order. A foreign investor will typically be informed within 10 days of the decision being made along with any conditions that may be imposed.

A foreign investor can only invest in residential property that adds to the property pool. i.e. they can only buy new residences or purchase vacant land with the understanding that construction must commence within 24 months of purchase.

Sound Guidance from a Reputable Team

Fountain Property Group has a staff of specialists from the finance and real estate fields with close ties to financial planners. Their team source and research all properties thoroughly to ensure rental potential, capital growth and superior construction. They have vast experience in real estate, financial planning and mortgage lending so you know you are dealing with quality and experience when you purchase a property from Fountain Property Group.

Whether you are an Australian citizen or a foreign investor looking at buying investment property, the Fountain Group can guide you through the sometimes complex negotiations involved. Contact them now at www.fountain.com.au and set yourself on a course to financial freedom.
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Dorian Traill is the current Director of Grand Capital Finance Group and Fountain Property Group. He specialize in home loans for people as well as helping them build wealth through quality investment properties that ultimately lead to long term financial freedom.