Home News Market Watch: Foreign buyers to be hit by fee hikes

Market Watch: Foreign buyers to be hit by fee hikes

Font size :
Foreign buyers to be hit by fee hikes
The property industry has reacted to federal government plans to change the rules on foreign investment in Australian real estate. Under the proposals foreign buyers of property up to $1 million would pay an application fee of $5,000 and those buying in the $1-2 million range would pay a $10,000 fee. There would then be an additional $10,000 payable for every million dollars above $2 million. There has been speculation that the fee would be in the region of $1,500.

Industry bodies have been quick to react with the Real Estate Institute of Australia welcoming the government’s resolve to strengthen compliance and enforcement of foreign investment in the property market but concerned that the fees will discourage it. Although Hong Kong and Singapore have higher fees the UK, US and Canada have none and in other countries such as Switzerland they are lower than the proposed levels. REIA CEO Amanda Lynch is pleased however that the proposals support the institute’s proposal for penalties imposed for breaches of regulations to be increased.

Meanwhile the Property Council of Australia has strongly rejected the proposed new fees with CEO Ken Morrison calling them “a new federal stamp duty by stealth.” He warns that the entire residential property market will suffer and that first-home buyers will be among those that suffer: “It would be an extension of one of the worst, most inefficient state taxes and Australians are the ones who would ultimately pay the price,” he said. Morrison believes that the basis for the tax is itself flawed: “It is an outright myth that foreign investment makes houses more expensive for Australians, quite the opposite.”
Source: REIA, Property Council of Australia

Housing prices are not a risk says treasury chief

The new federal treasury chief John Fraser does not believe that high housing costs are a risk to Australia’s economy. He told a Senate estimates committee that although pockets of high prices, such as those in Sydney, are not healthy they are a contained risk and should not be of concern to the economy at large. Fraser highlighted the lack of land supply as a problem and also believes that plans by the Australian Prudential Regulation Authority to curb investment lending would be successful.
Source: Sky News

Australian households increase spending
There has been a slight increase in spending by Australian households according to the latest figures from the Commonwealth Bank. January saw a 0.2 per cent rise in trend terms from the month before. Craig James from the bank’s subsidiary CommSec commented: “With household finances improving following the fall in petrol prices and recent interest rate cut, we can expect many consumers to slowly start opening their wallets and increasing their spending as we progress through 2015.” The largest growth in spending was in the ACT (0.7 per cent) while NSW saw the largest decline (2 per cent).
Source: Commonwealth Bank

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

House prices return to more affordable levels in mining towns House prices return to more affordable levels in mining towns

While the end of the mining boom has had a negative impact on property prices, homes in the region have become more affordable Read more

Borrowers should anticipate a possible rate hike Borrowers should anticipate a possible rate hike Some experts advise borrowers to look for a fixed loan that allows extra repayments so that they can whittle down the balance sooner ... Read more

Why choosing the right mortgage is hard for first-home buyers Why choosing the right mortgage is hard for first-home buyers Many feel overwhelmed by the sheer range of products and interest rates on offer, a new survey reveals ... Read more

Mortgage applications drop in second quarter Mortgage applications drop in second quarter This marks the “beginning” of a downward trend, says Equifax executive ... Read more

More mortgage news and articles

Sponsored Links

Wednesday, Jul 26, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Whether you're a first homebuyer, looking to refinance, or investing, it's important to have the right loan for your needs. Just fill in a few details below and one of our trusted mortgage advisers will contact you.

A quick & easy way to find the right home loan
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords