Australia im­poses fees on for­eign prop­erty buy­ers

China Daily (Canada) - - FRONT PAGE - ByMUCHEN muchen@chi­nadaily.com.cn

Chi­nese and other for­eign na­tion­als buy­ing res­i­den­tial real es­tate in Australia face ad­di­tional fees as the gov­ern­ment in Can­berra seeks to curb soar­ing prop­erty prices and il­le­gal home buy­ing.

Aus­tralian Trea­surer Joe Hockey said on Wed­nes­day that the pro­gram will mean fees of A$5,000 ($3,940) for homes val­ued un­der A$1 mil­lion and they will in­crease by A$10,000 for each ad­di­tional A$1 mil­lion.

The­moveis ex­pected to raise A$200 mil­lion a year, which will help fund stronger en­force­ment of the coun­try’s for­eign in­vest­ment laws.

Inad­di­tion, for­eign­ers found to have bought prop­erty il­le­gally will be fined as much as 25 per­cent of the value of the prop­erty, saidHockey. source of for­eign in­vest­ment in real es­tate with A$5.92 bil­lion, of which A$1.96 bil­lion was in res­i­den­tial real es­tate.

Aus­tralian Prime Min­is­ter Tony Ab­bott said the is­sue was that the rules, where for­eign­ers can only buy new res­i­den­tial prop­ertyand­not ex­ist­ing prop­erty, have not been en­forced in re­cent years.

“The idea is not to de­ter for­eign in­vest­ment; the idea is to en­sure that the rules are en­forced,” Ab­bott said.

Aus­tralian real es­tate firm Domain Group said Syd­ney recorded its high­est auc­tion clear­ance rate of 84.6 per­cent with more than 600 prop­er­ties un­der the ham­mer on Satur­day.

The rush to se­cure a her­itage­house in the Ro­seville sub­urb of Syd­ney led two sep­a­rate Chi­nese buy­ers to knock on its door with com­pet­ing bids of A$4.75 mil­lion and A$4.8 mil­lion, re­ported the Syd­neyMorn­ingHer­ald.

Ahead of the an­nounce­ment of the new mea­sures, in­ter­na­tional pur­chases of Aus­tralian real es­tate were fore­cast to grow 15 to 20 per­cent in 2015, ac­cord­ing to China’s largest in­ter­na­tional prop­erty web­site, Juwai.

Lu Ming, re­search manager at Cush­man and Wake­field, said that tougher en­force­ment of the for­eign in­vest­ment laws is good for the Aus­tralian gov­ern­ment, but the new mea­sures are un­likely to have a big ef­fect on Chi­nese buy­ers.

“Chi­nese buy­ers who are will­ing to fork out a few mil­lion Aus­tralian dol­lars for a home are un­likely to be de­terred by a few thou­sand dol­lars in ex­tra fees,” said Lu. “Chi­nese de­mand for Aus­tralian prop­erty will con­tinue to rise in 2015.”

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