A raft of new measures to kerb the negative impact of foreign investment on the nation's property market also look set to affect those in real estate roles. Treasurer Joe Hockey released details of the Foreign Acquisitions and Takeovers Legislation Amendment Bill 2015
on August 20, in a bid to "add integrity to the system" and discourage fraudulent transactions.
"The package delivers a robust and enforceable regulatory framework and provides a predictable and welcoming environment for investors," Mr Hockey told members of parliament.
It won't just be the investors who are held to account for their actions, but also any third parties that assist them during the property acquisition process. The Bill will therefore encompass lawyers, real estate agents, conveyancers and migration agencies, each of whom will face civil or criminal penalties if they fall foul of the law.
The Australian Taxation Office (ATO) has been given $47.5 million of funding over the next four years, which will be used to ensure greater compliance and rule enforcement. Through its data matching programs, the ATO will be capable of analysing 600 million transactions a year, with a view to recognising any that fall short of the required standards.
Regulations are due to come into effect on December 1 and anyone who has knowingly carried out non-complaint transactions is urged to come forward prior to this date. Mr Hockey revealed that reduced fines and penalties would be on offer until November 30 before these more stringent measures are put in place.
This is the latest strategy to have been introduced to kerb investment by overseas parties. Late last year, the Australian Prudential Regulation Authority (APRA) acknowledged that it would be clamping down on residential mortgages granted to investors.
It won't just be the investors who are held to account, but also any third parties that assist them during the property acquisition process.
APRA supervisors will be keeping a close eye on institutions that are lending large amounts to investors, and especially those with portfolio growth that exceeds 10 per cent.
These measures have already started to take effect, as the latest figures from the Australian Bureau of Statistics show that in June this year, the value of lending for investment housing was down 0.7 per cent from the previous month. This was against the backdrop of a 5.5 per cent increase in the value of owner occupied housing commitments.
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