FIRB Update: What does the ban on foreign persons acquiring established Australian residential land mean for you?

Earlier this year, the Federal Government announced that a temporary ban will be introduced on foreign persons (including temporary residents and foreign‑owned companies) purchasing established dwellings in Australia, effective from 1 April 2025 and will run until 31 March 2027. The aim is to ease pressure on Australia's housing market and increase the availability of existing homes for local buyers by restricting foreign investment. This ban coincides with stricter compliance measures and higher fees for foreign landowners.

A review will be undertaken by the government to determine whether the ban will stay in place after 2027.

What is being banned?

Under the new policy, foreign persons will be banned from purchasing established dwellings in Australia, which include existing residential properties that have been previously occupied or sold.

What are the exceptions?

• Projects increasing housing supply: foreign persons who seek to purchase and redevelop an existing property which will result in at least 20 additional dwellings. The previous policy included an exception for a redevelopment that would result in one additional dwelling.
   
• Commercial Scale Housing: foreign persons who seek to purchase an established dwelling where the acquisition supports the availability of housing on a commercial scale, including interests in retirement villages, aged care facilities and student accommodation.
   
• Build to Rent: foreign persons seeking to purchase existing build-to-rent developments.
   
• Employee Living Quarters: foreign controlled companies that employ workers from Pacific island countries and Timor-Leste and are required to provide housing for them, including those participating int the Pacific Australia Labour Mobility scheme.

What does this change?

Prior to this new ban, foreign persons were generally prohibited from purchasing established dwellings.

1. Temporary residents can no longer apply for approval to purchase an established dwelling, even if it is their principal place of residence.
    
2. ‘Projects increasing housing supply’ will only apply in limited circumstances, with the number of new dwellings needed to enliven the exception, raised from 1 to 20.
    
3. The ATO will carry out a full audit of foreign investors who have approval for vacant residential land development.

If you think you might be impacted by the introduction of this new ban, please get in touch with our team.

Further reading

Minister's Announcement from the Treasurer detailing the reforms, as an initial overview.

On 14 March 2025, the Treasury released an updated Residential Land guidance note which sets out these changes in greater detail.

ATO Guidance which can help understand the Tax Office's position on the changes.