The Australian government is cracking down on foreign investors who have illegally purchased properties in the country, Reuters reported. Authorities have told the perpetrators to declare themselves by December or risk facing tough new penalties including three years’ jail and fines of up to AUS637,500.
The new measures recently unveiled by the Federal Government after finding that authorities had failed to properly police laws making it illegal for foreigners to buy established homes in Australia. Real estate agents, developers and other third parties who knowingly help those buyers may also be penalized with fines of up to AUS42,500 for individuals and AUS212,500 for companies.
Foreign buyers who are forced to sell a property under the new laws will be prevented from profiting from the sale, the Government also announced. Australian Treasurer Joe Hockey said investors could avoid prosecution if they come forward by the 30th November deadline.
“I say to foreign investors, you have until the end of the year to declare yourselves,” Hockey added. “If you do not come to us, we will come to you because eventually we will find those people that have engaged in unlawful acquisition of Australian real estate and we will prosecute you and we will be very hard about it.”
Reuters added that Prime Minister Tony Abbott claimed, “there was no doubt” that foreign investors who illegally bought existing homes were “driving up” house prices.
“If all foreigners are doing is adding to the housing stock, that tends to reduce prices but once foreigners come into existing housing stock, that tends to increase prices,” Abbott noted. “So what we want to do is ensure that illegal foreign investment is not unnecessarily driving up prices.”
It is estimated that the government is investigating around 100 cases at the moment with foreign investment rules now be enforced by the Australian Tax Office rather than the Foreign Investment Review Board.
