Foreign home buyers race to beat April ban

Buyers from Hong Kong and Taiwan were also approved for $100 million respectively, taking to $600 million the total from that region. That accounts for close to half the $1.3 billion approved foreign investment in residential real estate in the first quarter of the 2025 financial year.

Since then, the Albanese government has announced a ban on temporary residents buying existing homes, countering a similar Coalition election promise made by Peter Dutton last year. Announced this month, the federal government ban comes into effect on April 1 and will run for two years.

Fiona Yang, executive partner of Plus Agency, a project marketing agency, said her business had experienced a seasonal jump in sales last September and October and expected a fresh rush in the next few weeks as the April ban nears.

“The persistent foreign buying, especially from China, is a matter of timing,” she said.

“We call it ‘Golden September and Silver October.’ Those two months have always popped compared to other months of the year.

“It’s a combination of holidays, people wanting to be able to move in by the end of the year. By then, people already know what their finances will look like for the year.”

Under existing rules, overseas investors are mostly barred from buying existing homes in Australia, save for limited circumstances. Under the new policy, people living temporarily in Australia, either for work or study, will be barred between April 1 this year and March 31, 2027.

Permanent residents are exempt from the ban and the ban doesn’t apply to purchases of new dwellings.

Buyers from China were approved for 396 residential purchases, the highest of any nationality, over the September quarter, according to FIRB.

Indians were granted 153 approvals and Britons were given 54 approvals. However, foreign purchases constitute just a tiny fraction of the estimated 663,000 residential sales struck in the five mainland states in the 2024 financial year.

Those sales were worth around $585 billion, according to PEXA, an e-conveyancing platform.

Nonetheless, Plus Agency’s Yang expects a surge in coming weeks.

“You will have a significant increase in FIRB transactions, as they want to catch the last train,” she said.

“They worry that this is their last chance to buy. Now, it is true the letter of the law doesn’t ban purchasing of new homes, but many buyers only see the headline.

“Also, many unscrupulous agents are using the ban as a selling point to urge buyers to move quickly.”

Jason Roach, a former investment banker turned agent with The Agency on Sydney’s Upper North Shore, said the majority of buyers of Chinese heritage that he dealt with had permanent residency.

“My view as a boots-on-the-ground real estate agent for more than a decade is that it won’t make an ounce of difference. They all have PR and are allowed to buy.

“I couldn’t tell you the last time I sold an existing home to a buyer that required FIRB approval.”

In any case, the FIRB figures reveal the enthusiasm of buyers from China has cooled somewhat in recent quarters, with a total of $2.6 billion for the financial year of 2024 well down on the previous year at $3.4 billion.

Last November, on the sidelines at the G20 summit in Brazil, China’s President Xi Jinping urged Prime Minister Anthony Albanese to loosen restrictions on Chinese foreign investment.

Relations with China are being tested again this month after the Chinese conducted naval exercises in international waters between Australia and New Zealand. Live-fire drills forced commercial flights to divert from trans-Tasman routes last week.

According to the FIRB data, commercial real estate is the biggest single industry attracting foreign investment, with $24.1 billion approved. The services sector attracted $10.3 billion and mineral exploration $5.8 billion.