Buying property in Australia

It is a relatively easy process to buy in Australia, even as a foreigner, but there are few things to remember. The government, through the Foreign Investment Review Board, or FIRB ( www.firb.gov.au ), must approve all sales of property to foreigners. This process takes approximately 30 days, and any purchase contract must have this review period written into the contract unless approval has been received prior to entering into the contract.

The FIRB has a few restrictions on foreign purchase of property to keep in mind. For complete procedures, regulations and forms refer to their website, but the basics are as follows. Temporary residents may purchase property for their time in Australia, but they must agree to sell it when their residency ends. For permanent purchases, you may buy a new or under-construction building, as well as new apartments, flats, townhouses and condo units. If you want to purchase a house or building that was previously owned, then you must add at least 50% of its cost to it through renovations or additions. Vacant residential land may be purchased; however, you must begin construction on a residency within 12 months of the land purchase.

Once you find a property, an offer is made verbally or on paper. After the price is agreed upon, a holding fee, usually 10%, is given to the owner while the contract is being finalized and FIRB approval is undertaken. With FIRB approval, the contract is almost always binding and you must finance or pay for the property outright or you lose your 10%. Taxes and fees usually amount to at least 5% of the purchase price in addition to it, and are different for every state and territory.

Mortgages in Australia are fairly easy to obtain, even for oversees purchasers. The banking system is modern and there are any number of lenders and types of mortgages. Rates today average from 6% - 9% typically, and the standard minimum amount to borrow is $100,000 AUD. Terms are usually for 25 years.