The adjusted plan will see a tripling of foreign investment fees for established home purchases, the doubling of vacancy fees for all foreign-owned dwellings and an enhanced compliance regime to ensure adherence to these rules.
Additionally, only certain visa holders who study or work in Australia will be able to purchase existing homes.
The government will also make sure foreign investment application fees for build-to-rent projects are at the lowest commercial level.
“The government wants to add 1.2 million homes in Australia over the next five years, and the levers they’ve pulled here make sense to help direct foreign investment and aid in achieving those goals,” said Realmark managing director, John Percudani.
“There’s no one way to solve the housing crisis, but I believe this move will incentivise overseas investment, which assists in adding stock in significant volume while increasing access to affordable housing and rental options.
“With what we’re seeing on the ground at Realmark, the forces of demand and supply will continue to impact the housing market, particularly here in WA, well into 2024 and beyond.”
In a statement, the Property Council of Australia has also welcomed the changes while encouraging further adjustments.
“The Property Council notes that more settings need to change to unlock the potential of global institutional investment into new Australian housing, including critical areas where governments can save money through service aggregation such as retirement living communities and purpose- built student accommodation,” it said.
“The National Cabinet needs to think holistically about the tax settings that can help or hinder investment in creating more homes for Australians – including looming Federal ThinCap changes and finalising the detail of build-to-rent MIT withholding rate changes.”
Treasurer Jim Chalmers said the government welcomed foreign investment where it increased housing supply.
"There are too many properties empty around Australia, part of the challenge here is we do have these tough foreign investor rules but we want to make them tougher," Mr Chalmers said.
"Every extra house that is built in this economy, every extra property that goes onto the rental market is welcome."
If you are considering buying a home or investing in Western Australia our team at Realmark can assist in navigating the process.