Types of Properties that Foreign Investors can Purchase

Types of Properties That Foreign Investors Can Purchase

Australia is an attractive country for property investment. It has a stable economy and offers an engaging lifestyle for those who intend to stay here permanently. However, if you are a foreign investor interested in purchasing real estate, you need to understand that you cannot purchase just any property you set your eye on.


3 Types of Residential Property Investment Foreigner Can Opt For

To prevent confusion and possible heartache for not buying the house you fell in love with, you need to learn first which ones you are allowed to purchase. The types of properties that foreign non-resident investors can purchase are:


  1. Newly-built Properties

If you are looking to purchase a property free of any hassles, it is recommended that you purchase a freshly constructed property. Generally, there are no conditions for foreigner non-residents purchasing new dwellings, and there is no limit to how many new dwellings foreign investors can buy.

What is considered a newly-built property? For a property to be categorized as a new dwelling, it must be either:

  • Built on a residential land and has not had any occupants in the past; or
  • If the property is a part of a residential development of more than 50 dwellings AND was placed on sale by the developer AND has not been occupied for more than one year.

The following are not considered a newly-built property:

  • A renovated home;
  • A house or apartment building built on land which was previously occupied by a demolished building.

The reason behind this is that even though these are newly constructed properties, they do not increase the housing supply in Australia. Foreigners are only allowed to purchase properties that can be considered “in excess” of what is available to locals in order to be consistent with the national interests.

Types of Properties that Foreign Investors can Purchase


  1. Vacant Lots

Foreign investors are allowed to buy vacant lands subject to conditions. These conditions are:

  1. The land is purchased for residential dwelling development;
  2. The construction of the residential property must be accomplished within four years, starting from the approval date;
  3. Proof of completion of the construction of the residential property must be submitted within 30 days of completion. A final occupancy document and a builder’s completion certificate are acceptable evidences for this purpose.

If the development of the residential property cannot be completed within four years, foreign investors can submit an application for a variation of the condition. This can only be done under exceptional circumstances and will be approved on a case to case basis. The application must be submitted no less than two months before the end of the four-year period and will be subjected to fees.

An unoccupied land that used to have a residential dwelling which was demolished is not categorized as a vacant land. If you mean to purchase such land with the intention of building more houses or dwellings than it had in the past, you will be increasing the housing supply and might be approved for such purchase.


  1. Established Real Estate Properties for Redevelopment

In keeping up with Australia’s goal of making sure the housing market is readily available for locals, foreigners are only allowed to purchase established real estate properties that are planned for redevelopment. This is still subject to the condition that the redevelopment plan will increase the housing stock. For example, one residential home can be re-constructed to build two or three new homes.

Types of Properties that Foreign Investors can Purchase

Other conditions for such property investment include the following:

  • The existing property cannot be rented out or occupied prior to redevelopment;
  • The redevelopment process must be completed within four years of the approval date;
  • Proof of completion of the construction of the residential property must be submitted within 30 days of completion. A final occupancy document and a builder’s completion certificate are acceptable evidences for this purpose.

Remember that whichever residential property you’d like to purchase, you would still need to go through the FIRB’s approval process and pay equivalent fees. Read our article on the FIRB approval process for more information.


2 Types of Commercial Real Estate Properties Foreigners Can Purchase

Foreigner investors have also come in droves in Australia because of its great real estate investment climate in the commercial sector. Foreigners are allowed to purchase commercial land and properties, subject to certain conditions.


A commercial property is any real estate in Australia except:

  • Land that is used fully and solely for a primary production venture;
  • Land that can accommodate no more than 10 reasonably sized dwellings;
  • Land that houses at least one building or home that is not commercial residential premises.

The seabed in Australia’s offshore area is also considered commercial land.


Two general classifications of commercial land are as follows:

  1. Vacant Commercial Lot

A piece of land is said to be vacant if it does not have any buildings, personal properties or livestock in the space. Whatever the value of the land may be, foreign investors are required to notify the FIRB. Notifications of no objection must include agreement of the foreign investor to the following:

  • The land must undergo development within five years after approval date;
  • The land cannot be sold until the construction has been completed.


  1. Developed Commercial Property

Developed commercial properties come in two forms: the first one is the obvious commercial property such as malls, office, factories, retail outlets and more; the second one is the commercial residential property.


Commercial residential properties are as follows:
  • Hotels, motels, hostels, inns or boarding houses;
  • Serviced apartments purchased solely for renting out;
  • Bed & Breakfasts wherein less than 10% of the property’s space and less than 10% of the property’s value will be used as owner’s residence.

If the serviced apartment will be used for occupancy by the owner and will only be rented out occasionally or privately, it will be considered as residential real estate. In the same light, if the foreign owner will use more than 10% of the bed & breakfasts’ property as residence, it will also be considered a residential property.


Though policies on foreign investment in both residential and commercial real estate properties have become stricter in the recent years, foreign investors continue to pour in for good reason. The recent policies were only able to filter out investors who are serious in entering the Australian real estate market. If you need assistance in acquiring a real estate property in Australia, whether for residential or commercial purposes, don’t hesitate to contact us.