What is FIRB
The Foreign Investment Review Board is an Australian government body that regulates foreign investment in Australian assets, including residential property. If you are a foreign investor, you must obtain FIRB approval before purchasing residential property, unless you qualify for an exemption. This approval ensures that foreign investments align with national interests and support Australia’s housing market.
Who Needs FIRB Approval
Foreign investors must apply for FIRB approval before purchasing
- new or near-new dwellings that have never been occupied or have only been used for a short period in a newly developed project
- established dwellings are NOT allowed for temporary residents to buy after 1 April, 2025
- vacant land that does not contain any permanent structures and is intended for residential development
- off-the-plan properties, which are apartments or townhouses purchased in new developments before construction is completed
- properties for company staff housing, which are properties bought by foreign-owned companies to house Australian-based employees
When FIRB Approval is Not Required
FIRB approval is not required for
- Australian citizens, permanent residents, or New Zealand citizens
- foreign investors purchasing property with an Australian citizen spouse as joint tenants
- developers who hold a new dwelling exemption certificate, which allows foreign buyers to purchase without additional FIRB approval
How to Apply for FIRB Approval
Determine the right application type based on whether you are purchasing a specific property or seeking an exemption certificate.
Submit your application online through the Australian government’s online services for foreign investors platform.
Pay the application fee, which varies depending on the property value. The application will not be processed until payment is made in full.
Await approval, which typically takes up to 30 days, though complex cases may take longer.
Exemption Certificates
If you have not decided on a specific property, an exemption certificate may be a suitable option. This allows you to
- bid on multiple properties within a designated state or territory for up to 12 months
- avoid multiple FIRB applications if you do not succeed in securing your first-choice property
However, exemption certificates only allow the purchase of one property. Once a purchase is made, the certificate cannot be used again.
Approval Conditions
Each FIRB approval comes with conditions to ensure compliance with Australian investment rules. These may include
- using the property as a principal place of residence if the buyer is a temporary resident
- not renting out the property if purchased for personal use
- completing redevelopment projects within four years if the purchase is for redevelopment purposes
- meeting construction deadlines if buying vacant land
Failure to comply with these conditions may result in financial penalties or forced property sale.
Varying an Existing FIRB Approval
If your circumstances change, you may need to modify an existing FIRB approval. FIRB allows two types of variations
- simple variation for minor changes, such as correcting an error in the property address or buyer’s name
- complex variation for significant changes, such as extending approval validity, modifying conditions, or adding a new wholly-owned subsidiary to an application
If the modification is substantial, you may need to submit a new application instead of a variation request.
Mortgagee Interest
A mortgagee interest arises when a foreign lender provides financing secured by Australian residential property. Foreign lenders must obtain FIRB approval before acquiring a security interest in Australian real estate.
Paying FIRB Fees
FIRB fees vary based on property value and must be paid in full before your application is processed. Fees are non-refundable, even if the application is unsuccessful.
Vacancy Fee Obligations
Foreign property owners are required to lodge an annual vacancy fee return, proving that the property is being used. This discourages properties from remaining unoccupied, which can impact housing availability.
Penalties for Non-Compliance
Failure to comply with FIRB rules, such as failing to seek FIRB approval before purchasing, misusing an exemption certificate, or failing to meet development conditions, may result in fines, forced property sale, or being barred from future investment in Australia.
How Ensure Legal Can Help
Applying for FIRB approval can be complex, but Ensure Legal provides expert assistance, including
- legal consultation to assess FIRB requirements
- application preparation and submission to ensure compliance
- contract review to avoid legal pitfalls
- variation requests for modifying existing approvals
- exemption certificate guidance to determine the best investment strategy
For professional legal support with FIRB applications and Queensland property transactions, contact Ensure Legal today. Our experienced team will guide you through every step of the foreign investment approval process, ensuring compliance and a smooth property purchase in Australia.
