Indian investors can not buy property in Australia as govt puts a 2-year ban: New rules here

Australia will impose a two-year ban on foreign investors purchasing existing homes, starting April 1, 2025, in a bid to address the country’s worsening housing crisis. The measure, expected to free up around 1,800 properties annually for local buyers, will be reviewed before its scheduled end on March 31, 2027.

A move to ease housing affordability pressures

Announcing the decision, Treasurer Jim Chalmers and Housing Minister Clare O’Neil emphasized that the ban aims to curb foreign competition in the housing market, particularly as affordability remains a pressing issue ahead of the general elections.

Foreign investors, including temporary residents such as international students and foreign-owned companies, will be barred from buying established dwellings. However, they will still be permitted to purchase newly built homes to encourage housing supply.

To further discourage "land banking"—where investors hold onto undeveloped land, limiting supply—the government will require foreign buyers of vacant land to develop it within a set timeframe. Additionally, foreign-owned properties left vacant for more than six months in a year will be subject to an annual vacancy fee.

Housing market impact and concerns

The policy aligns with similar restrictions introduced by the previous Coalition government and is part of broader efforts to stabilize the housing market. Housing prices in major cities have skyrocketed in the past decade, with Sydney’s median dwelling price reaching A$1.2 million, according to CoreLogic data cited by The Straits Times.

Foreign investors purchased A$4.9 billion worth of residential real estate in the year ending June 30, 2023, with one-third of that spent on existing dwellings, the Australian Taxation Office reported.

While the ban is expected to ease demand pressure and improve access for local buyers, some experts warn that restricting foreign investment could slow new housing development and impact the broader economy. The government plans to assess the policy’s effects before deciding whether to extend it beyond 2027.