Australia has announced a two-year ban on foreign investors purchasing existing homes, aiming to tackle the escalating housing prices that have become a major concern, particularly among young voters. The ban will come into effect on April 1, 2025, and will remain in place until March 31, 2027. The policy will then be reviewed to assess its impact and determine if an extension is necessary.
Housing Minister Clare O’Neil emphasized that the policy would help “free up thousands of properties for Australians,” addressing the country’s ongoing housing crisis. She pointed out that successive governments have failed to build enough homes for the growing population over the past 30 years, leading to the affordability issues faced by many Australians today.
The policy targets foreign investors, including temporary residents such as international students and foreign-owned companies, who will be restricted from purchasing homes during the two-year period. In addition to the foreign ownership ban, the government will also introduce stricter regulations on land banking, compelling foreign investors to develop vacant land within a specific timeframe. O’Neil highlighted the need to prioritize homeownership for young Australians, though she acknowledged that the policy would not serve as a “silver bullet” to resolve the crisis.
The move comes in the midst of political debates about housing affordability, with opposition leader Peter Dutton criticizing the policy. Dutton, whose party proposed similar measures last year, accused the government of copying the idea in the lead-up to the upcoming elections. Despite this, O’Neil defended the policy, calling it a crucial part of the broader housing agenda.
While the foreign investor ban is expected to have a limited immediate effect on property prices—since foreign buyers represent a small portion of the market—it reflects the government’s determination to ease pressure on the housing market while also increasing housing supply. In the 2022-23 period, foreign buyers accounted for just 5,360 residential property transactions, with only a third of those involving existing homes.
The government has pledged to further support the initiative by allocating additional funding to the tax office to ensure effective enforcement of the policy. As the country prepares for elections by May 17, both major parties have prioritized addressing housing affordability, with O’Neil emphasizing that the policy is just one part of a larger, comprehensive housing strategy.
