Federal Budget 2025-2026: FIRB snapshot

Foreign home buyers lose out, as the Federal Budget announcements confirm two-year acquisitions ban, while vacant land acquired for development will face greater scrutiny.

While the two-year ban on foreign persons acquiring established dwellings will grab the headlines, the reality is that what is being targeted is a relatively small number of acquisitions. Based on the Foreign Investment Review Board’s (FIRB) reporting for the period 1 July 2022 to 30 June 2023, there were 5360 purchases of Australian residential real estate with a level of foreign ownership reported to FIRB, and of these 34 per cent (approximately 1822) related to established dwellings.

The biggest impact will likely come from the accompanying announcement that the Australian Taxation Office and Treasury will be given extra funding to implement an audit and compliance program targeting land banking. This serves as a warning to foreign property developers that they will come under greater scrutiny as the government seeks to ensure the requirements for the residential and commercial development of vacant land are met.

The announced Budget measures aim to make it easier for Australians to buy homes without competition from foreign purchasers, while encouraging foreign persons to instead make investments that boost Australia’s housing stock.

This audit and compliance program will place added pressure on foreign landholders to ensure requirements to put vacant land to use for residential and commercial development within reasonable time frames are met.