Australia’s left-wing Labor government will ban foreigners from buying existing homes for two years in an effort to ease the mass immigration-driven housing crisis.
The 2025 Federal Budget allocated $5.7 million to the Australian Tax Office (ATO) to enforce the ban, and $8.9 million over four years and $1.9 million per year afterwards to ATO and the Treasury to implement an audit program to target land banking by foreign investors.
The ban will prevent foreign persons, including temporary residents and foreign-owned companies, from purchasing existing dwellings for two years starting from April 1, and will decrease government revenue by $90 million due to foregone foreign investment application fees.
“Exceptions to the ban will include investments that significantly increase housing supply or support the availability of housing on a commercial scale, and purchases by foreign‑owned companies to provide housing for workers in certain circumstances,” Treasury said.
Labor sources said last month the government was looking to neutralise the issue of foreign home ownership ahead of the election as it resonates with voters, and the ban matches a proposal made by Opposition leader Peter Dutton in his 2024 budget reply speech, and mirrors One Nation’s housing policy.
Tuesday’s budget also revealed that only 45,000 new homes were completed in the first quarter of the government’s National Housing Accord out of a target of 1.5 million, and forecasts net overseas migration of 335,000 next year, 260,000 the year after that, and 225,000 in 2026-27.
According to the budget, net overseas migration for 2023-24 was 435,000, which is lower than the 446,000 recorded by the Australian Bureau of Statistics, but still far higher than last year’s budget forecast of 260,000 which was then revised upwards to 340,000 in December.
And the 335,000 forecast for 2024-25 is already an increase of 75,000 on last year’s budget prediction of 260,000.
“Arrivals are expected to continue to decline in 2024–25 before stabilising in 2025–26. Departures are expected to pick up from recent sustained lows as more people who arrived after the pandemic near the expiry of their visa,” Treasury said.
If Labor wins the election and the upcoming migration forecasts are accurate, it will mean a total net migration of 1.82 million over five years.
Mr Dutton will deliver his budget reply on Thursday night and has highlighted migration and housing as key issues.
Header image: A suburb of Melbourne (Geometric Photography – Pexels).
