A north shore councillor believes foreign property investors are the “elephant in the room” when it comes to housing affordability in Australia, with many outbidding local residents in buying apartments.
Lane Cove councillor Scott Bennison, who is also an accountant, argued that the competition foreigners bring to the property market helps keep young Australians from being successful at real estate auctions.
“[I’ve received] a number complaints by younger people who simply turn up to auctions and are consistently outbid by foreigners,” he was quoted as saying by the Daily Telegraph.
“You’re looking at two bed units at St Leonards now costing well close to one million dollars, which is excessive. If you start to look at the average income of people who leave university ... it will take these people about 18 years save for deposit, and that in today’s dollars. It’s just totally unaffordable.”
Bennison proposed the council write to the Federal Treasurer Joe Hockey recommendations on how tightening regulations to restrict foreign ownership could help young people afford to buy their own home.
The councillor also believes real estate agents should be brought under the anti-money laundering legislation and be required to obtain tax file numbers from purchasers.
“If the real estate agents were brought under that legislation and as a proof of identification the purchases had to provide tax file number, they’re actually in the system,” he said.
“Then it gives the opportunity for the tax office to, on the future sale of those properties, ensure there is tax clearance.”
For Neville Sanders, president of the Real Estate Institute of Australia, the proposed changes to foreign investment legislation would aid the crackdown on tax avoidance. These shall also create a national register of land ownership that would provide information directly to the tax office.
“Shifting responsibly to the ATO to register the actual owners is the key to making sure everybody complies with tax laws,” said Sanders.