Introduction
All foreign persons — including temporary residents, foreign companies, and foreign trusts — must obtain approval from the Foreign Investment Review Board (FIRB) before purchasing residential real estate in Australia. This requirement is enforced under the Foreign Acquisitions and Takeovers Act 1975 and applies regardless of the purchase price. The application fees alone can run into tens of thousands of dollars for higher-value properties, and state-level foreign owner surcharges on stamp duty and land tax can add significantly to the cost. According to FIRB’s Annual Report for 2024-25, the Board received approximately 7,200 residential real estate applications from foreign buyers, with a total proposed investment value of AUD 11.6 billion. The compliance and enforcement division issued 82 disposal orders (forcing the sale of unlawfully acquired property) in the same period. This article explains the FIRB application process, fees, what foreign buyers can and cannot purchase, and the additional state-level surcharges they will face in 2026.
Who Needs FIRB Approval
FIRB defines a “foreign person” broadly. The definition includes: an individual not ordinarily resident in Australia (i.e., someone who has not been in Australia for 200 days or more in the preceding 12 months and does not hold a permanent visa or a special category visa); a corporation or trustee of a trust in which a foreign person (or foreign persons collectively) holds a substantial interest of 20% or more; and a foreign government or foreign government investor. Temporary residents — including holders of temporary skilled visas (subclass 482), student visas (subclass 500), working holiday visas (subclass 417/462), and bridging visas — are treated as foreign persons for FIRB purposes and must obtain approval.
Australian citizens (regardless of where they live), permanent residents, and New Zealand citizens who hold a Special Category Visa (subclass 444) and are ordinarily resident in Australia are not foreign persons and do not need FIRB approval. However, if an Australian citizen is purchasing property jointly with a foreign spouse or partner, FIRB approval is still required because one of the purchasers is a foreign person.
What Foreign Buyers Can Purchase
Foreign buyers face the most significant restrictions when purchasing established (existing) dwellings. Temporary residents may purchase one established dwelling for use as their principal place of residence, provided they sell the property within 3 months of it ceasing to be their principal residence (e.g., if they move out, rent it out, or their visa status changes). Foreign buyers who are not temporary residents — including foreign investors living overseas — are generally prohibited from purchasing established dwellings entirely. The exemption is for large-scale redevelopment: a foreign investor may purchase an established dwelling if the intention is to demolish it and build multiple new dwellings, thereby increasing the housing stock.
There is no restriction on foreign buyers purchasing new dwellings (including off-the-plan apartments and house-and-land packages where the dwelling has not been previously occupied) or vacant residential land with the intention of building a dwelling. The government’s policy rationale is that buying new dwellings adds to housing supply, whereas buying established dwellings simply transfers existing housing stock and can contribute to price inflation without increasing supply. Foreign buyers purchasing vacant land must commence construction within 4 years of obtaining FIRB approval, and must complete construction and make the dwelling available for occupancy within a reasonable time.
FIRB Application Fees 2026
FIRB application fees are tiered by property value and were significantly increased from 1 July 2025. For residential real estate valued at AUD 1 million or less, the application fee is AUD 14,100. For properties valued between AUD 1 million and AUD 2 million, the fee is AUD 28,300. Between AUD 2 million and AUD 3 million: AUD 56,600. The fee escalates through tiers up to AUD 1,130,000 for properties valued at AUD 40 million or more. For temporary residents purchasing an established dwelling as their principal place of residence, the same fee schedule applies. For vacant land, the fee applies based on the purchase price of the land.
The application fee is non-refundable regardless of whether the application is approved or rejected. FIRB’s stated processing time is 30 days from the date the application fee is paid, but in practice, most straightforward residential applications (individual temporary resident purchasing a new apartment) are processed within 2-4 weeks. More complex applications — such as those involving large developments, agricultural land, or foreign government investors — may take 90 days or more, and FIRB may request additional information during the review period.
State-Level Foreign Owner Surcharges
In addition to the FIRB application fee, foreign buyers must pay foreign owner surcharge stamp duty (also called additional duty or surcharge purchaser duty) in most states, plus an annual foreign owner land tax surcharge. These are state-level charges separate from the federal FIRB process.
As at 2026, NSW charges an 8% foreign owner surcharge stamp duty on top of the standard stamp duty (which ranges from approximately AUD 10,000-55,000 depending on the property value and type). This means a foreign buyer purchasing a AUD 800,000 new apartment pays approximately AUD 31,000 in standard stamp duty plus an additional AUD 64,000 in foreign surcharge — total stamp duty AUD 95,000. NSW also charges a 4% foreign owner land tax surcharge annually on the taxable land value. Victoria charges an 8% foreign purchaser additional duty plus a 4% absentee owner surcharge (for land tax purposes) rising to 4% in 2026, from 2% in 2024. Queensland charges a 7% Additional Foreign Acquirer Duty plus a 2% foreign owner land tax surcharge. WA charges a 7% foreign buyer surcharge. SA charges a 7% surcharge. Tasmania charges a 3% surcharge.
The combined cost of the FIRB application fee and state surcharges means that a foreign buyer purchasing a AUD 800,000 new apartment in Sydney might pay approximately AUD 14,100 (FIRB fee) + AUD 95,000 (total stamp duty including surcharge) = AUD 109,100 in upfront approval and tax costs alone, plus annual land tax surcharge of approximately AUD 2,000-4,000 per year depending on the land value component of the property.
Common Reasons for FIRB Rejection
FIRB rejects or imposes conditions on applications for several recurring reasons. Purchasing an established dwelling without meeting the principal place of residence requirement is the most common trigger for rejection or subsequent enforcement action. The ATO’s FIRB compliance division uses data-matching with state land titles offices, immigration records, and utility usage data to detect unlawfully acquired properties. Purchasing multiple established dwellings (even if the purchases are years apart) also triggers review — temporary residents are limited to one established dwelling at any time. Failure to commence construction on vacant land within 4 years is another common compliance issue. Purchasing a property through a company or trust structure in which a foreign person holds an undisclosed beneficial interest triggers enforcement under the “association” and “tracing” provisions of the Act.
FAQ
Do I need FIRB approval if I am buying property with my Australian citizen partner?
Yes, if you are a foreign person. FIRB approval is required for the entire transaction if any one of the purchasers is a foreign person. The application must include both your details and your partner’s details, and the fee is calculated on the total purchase price. Your Australian citizen partner does not change the requirement.
How long does FIRB approval last, and can I apply before finding a property?
FIRB approval is typically valid for 12 months from the date of the approval letter (for established dwellings and new dwellings), with a possible 6-month extension upon request. You can apply for FIRB approval before signing a contract of sale, and this is recommended — you can then bid at auction or make an offer with the FIRB approval already in hand, which removes the risk of being unable to complete the purchase. However, the property you ultimately purchase must fall within the scope of the approval (e.g., if you obtained approval for a new dwelling but end up buying an established dwelling, the approval does not cover it).
What happens if I buy property without FIRB approval?
The ATO can issue a disposal order requiring you to sell the property within a specified period (typically 6-12 months). The ATO may also seek civil penalties of up to AUD 82,500 for individuals and AUD 412,500 for companies per breach, and criminal penalties (fines of up to AUD 166,500 for individuals and imprisonment for up to 10 years for the most serious and deliberate breaches). Any capital gain made on the sale of an unlawfully acquired property is forfeited to the Commonwealth.
Does FIRB approval apply to commercial property and businesses?
Yes, but the rules are different. Foreign investors must obtain FIRB approval for acquisitions of “substantial interests” (generally 20% or more) in Australian companies and businesses valued above certain monetary thresholds. The thresholds vary by country of origin (investors from free trade agreement countries such as the US, UK, China, Japan, and South Korea benefit from higher thresholds of AUD 1,362 million for non-sensitive businesses, while investors from other countries face a lower threshold of AUD 50 million for agricultural land and AUD 336 million for non-sensitive businesses).
Are there any exemptions from FIRB fees?
Very few. The primary exemption applies to New Zealand citizens purchasing residential property in Australia under the Trans-Tasman mutual recognition arrangements. New Zealand citizens who hold a Special Category Visa (subclass 444) and are ordinarily resident in Australia are treated as not being foreign persons and do not require FIRB approval for residential property. New Zealand citizens living overseas are still treated as foreign persons.
Data Sources
- Foreign Investment Review Board, Annual Report 2024-25 (firb.gov.au)
- Australian Taxation Office, FIRB Application Fees Schedule 2025-26
- Revenue NSW, Foreign Owner Surcharge Rates 2026 (revenue.nsw.gov.au)
- State Revenue Office Victoria, Absentee Owner Surcharge 2026 (sro.vic.gov.au)
- Queensland Revenue Office, Additional Foreign Acquirer Duty 2026
- Foreign Acquisitions and Takeovers Act 1975 (as amended)
Disclaimer: This article provides general information about the FIRB approval process and foreign ownership charges in Australia and does not constitute legal, migration, or financial advice. FIRB fees, state surcharges, and approval rules are subject to change. Foreign buyers should consult a qualified Australian conveyancer, property lawyer, or migration agent before entering into any property transaction.