25/09/2015

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Australia intensifies crackdown on illegal foreign investments

The Australian government has intensified its crackdown on illegal investments in local real estate, with nearly 500 properties worth A$1 billion under investigation, reported The Wall Street Journal.

As such, more foreign buyers have been forced to sell their projects.

The crackdown comes as pressure mounts on the authorities to rein in investment-driven buying, amidst growing criticism that wealthy buyers from Asia are pushing up property prices in Australia’s two largest cities of Melbourne and Sydney.

Treasurer Joe Hockey revealed that divestment orders have already been served on five properties across the country, which forced their owners who hail from Singapore, the UK, China and Indonesia, to sell.

The properties sold include homes located in the cities of Sydney, Adelaide, Brisbane, Gold Coast and Perth.

“The purchase prices of the properties range in value from A$265,000 to A$8.1 million,” said Hockey.

“The foreign investors involved either purchased established property without Foreign Investment Review Board approval, or had approval but their circumstances changed, meaning they were breaking the rules.”

However, he noted that all five owners voluntarily came forward to detail their investments. The move enabled them to sell their homes within a year instead of the usual three months, under a reprieve announced by the government in May.

The central bank has warned that the property boom is unbalanced and possibly dangerous to a fragile economy, as economists become increasingly anxious of the possibility the country is heading towards recession for the first time in 24 years.

Picture Source & Source copied from: http://www.propertyguru.com.sg/property-management-news/2015/9/108126/australia-intensifies-crackdown-on-illegal-foreign

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