Maybe it's so they can buy established — not necessarily brand new — dwellings?
That's what Gunna doesn't get. They can buy existing homes if they have permission, and they only have to ask. That's why I treat him as a joke. The FIRB isn't there to stop individuals buying houses under current policy, it's there to protect the national interest. Making it compulsory to ask means the FIRB has an opportunity to review significant transactions and enforce a compulsory sale if permission wasn't obtained in any sale, they really don't give a hoot about some house in the suburbs.
If a foreign individual does buy anything without approval, the FIRB can take it away, but not if they have approval. Seriously Real Estate Agents and Solicitors know this, why would they encourage buyers to avoid getting permission to buy when they know that permission will be granted. It's illogical. A solicitor could lose their practice over advice like that - why would they for a conveyance fee - it's just ludicrous to suggest they would.
Last year the FIRB only said 'no' on one occasion and that was for a significant purchase. I can't remember what, something in mining I think, not a house.
Chinese manufacturers and exporters have huge trade surpluses, they have to do something with that surplus. If we want cheap Chinese goods, then this is what we get - they will own our assets because they have to spend our dollars somewhere and they don't want $AUD in China - it's useless there. It's not like we manufacture anything that they want, so they buy our assets.
That's why I treat him as a joke. The FIRB isn't there to stop individuals buying houses under current policy, it's there to protect the national interest. Making it compulsory to ask means the FIRB has an opportunity to review significant transactions and enforce a compulsory sale if permission wasn't obtained in any sale, they really don't give a hoot about some house in the suburbs.
but not if they have approval. It's illogical. A solicitor could lose their practice over advice like that - why would they for a conveyance fee - it's just ludicrous to suggest they would.
Last year the FIRB only said 'no' on one occasion and that was for a significant purchase. I can't remember what, something in mining I think, not a house.
It's called 'trade'
Quote:
They can buy existing homes if they have permission, and they only have to ask.
How longs it take to get permission? Once a 'subject to FIRB approval' goes in a contract I imagine the price gets jacked up - everything gets delayed. Perhaps they work on 'it's easy to say sorry than ask permission' basis? What does FIRB do with transgressors?
Quote:
If a foreign individual does buy anything without approval, the FIRB can take it away,
But do they? I've seen no reports of enforcement from the FIRB. Is there any public released data around foreigners seeking/getting approval to buy resi property?
Quote:
Seriously Real Estate Agents and Solicitors know this, why would they encourage buyers to avoid getting permission to buy when they know that permission will be granted.
I'm not sure they encourage it. IIRC when I purchased, the broker/bank was the only one who required any sort of proof of residency/identiy and the agent/lawyer did not. Perhaps my white-ness influenced their id requirements.
Quote:
Chinese manufacturers and exporters have huge trade surpluses, they have to do something with that surplus. If we want cheap Chinese goods, then this is what we get - they will own our assets because they have to spend our dollars somewhere and they don't want $AUD in China - it's useless there. It's not like we manufacture anything that they want, so they buy our assets.
Couldn't we just write them an IOU on a serviette like the Americans do?
How longs it take to get permission? Once a 'subject to FIRB approval' goes in a contract I imagine the price gets jacked up - everything gets delayed. Perhaps they work on 'it's easy to say sorry than ask permission' basis? What does FIRB do with transgressors?
I don't think approval would hold up a normal contract if it was requested immediately. If approval isn't obtained the FIRB could force a sale. If finance is involved the lender won't be keen of a forced sale of security, that's why they insist on it. I don't believe the FIRB are actively out to get those who transgress, but they might, so why bother.
It's virtually a case of "ask and ye shall receive"
I was involved in a case where no one realised the buyer didn't have residency until it got to the lender. The lender then asked the buyer to obtain FIRB approval - the FIRB sanctioned the deal but wouldn't give approval officially because the contract didn't have the relevant clause in it, and so the lender refused to lend even though the FIRB had sanctioned the purchase. I haven't checked the standard mortgage terms and conditions but I would be surprised if the lenders didn't have that covered and the mortgagor would be in breach if they should have but failed to obtain FIRB approval.
Quote:
But do they? I've seen no reports of enforcement from the FIRB. Is there any public released data around foreigners seeking/getting approval to buy resi property?
I'm not sure they encourage it. IIRC when I purchased, the broker/bank was the only one who required any sort of proof of residency/identiy and the agent/lawyer did not. Perhaps my white-ness influenced their id requirements.
The Broker/Bank must obtain 100 points of ID and they will detect who is or isn't a resident. Real Estate agents are not required to check the nationality of buyers to my knowledge.
Quote:
Couldn't we just write them an IOU on a serviette like the Americans do?
Not sure what you mean.
snot bubbles
2 Sep 2014, 08:59 AM
First you told everyone that you couldn't get FIRB approval easily, Gunna and Chodley Wontok showed how easy it was
Not true, my position has always been that it's easy to get FIRB approval. Gunna made a laughing stock of himself when he applied for FIRB approval in circumstances where it wasn't even required.
Quote:
Then you said nobody could buy without FIRB approval and Gunna and virtually every other commentator since has shown that there is nowhere in the purchasing process where you would actually show any 'approval'
Try getting a loan for a non-resident without it.
Quote:
Then you said Austrac was ensured nobody moved money into Australia examined, Gunna said that was BS and the even Austrac have stated they don't look at real estate related funds.
There are two types of reports. Every transaction above $10,000 is reported and all suspicious transactions are reported. Large transactions that originate from outside Australia are considered high risk within the system. It comes under the "Anti-money laundering and Counter Terrorism Legislation" If you bring in enough funds to buy a house in one of our major cities it will be reported at least once. What AUSTRAC and the security agencies do with those reports is up to them.
Quote:
Then the other week you were out there saying Australian banks wouldn't lend to foreign nationals without FIRB approval and Gunna posted a page and a half of links saying they would.
Gunna and you continue to err, that's not my problem, it's yours.
The entire corrupt system is exposed in mainstream media on multiple occasions and yet the complete dis interest of our political representatives is astounding.
Ive seen articles in the local paper in Perth over years about real estate vendors marketing established dwellings to foreigners in clear violation of law, Multiple nation wide articles clearly depicting this illegal activity and they are all presented as some kind of congratulatory puff piece as the business genius of real estate spivs selling the country off a house at a time in clear violation of the law. Not a murmur of dissent from the authorities, not a single expression of outrage from our elected representatives. Its disgusting in the extreme.
It is disgusting in the extreme, and all aided and abetted by a MSM which profits from the process, all the while ignoring the damage caused the to the society whose interests they supposedly stand up for.
Whatever happened to the type of personal pride, integrity and compassion that prevented a person form selling out no matter the reward? It seems strength of character has become a weakness, and no matter how much money, influence, and power these people of “calibre” have, it is never enough.
The entire corrupt system is exposed in mainstream media on multiple occasions and yet the complete dis interest of our political representatives is astounding.
Ive seen articles in the local paper in Perth over years about real estate vendors marketing established dwellings to foreigners in clear violation of law, Multiple nation wide articles clearly depicting this illegal activity and they are all presented as some kind of congratulatory puff piece as the business genius of real estate spivs selling the country off a house at a time in clear violation of the law. Not a murmur of dissent from the authorities, not a single expression of outrage from our elected representatives. Its disgusting in the extreme.
It is disgusting in the extreme, and all aided and abetted by a MSM which profits from the process, all the while ignoring the damage caused the to the society whose interests they supposedly stand up for.
Whatever happened to the type of personal pride, integrity and compassion that prevented a person form selling out no matter the reward? It seems strength of character has become a weakness, and no matter how much money, influence, and power these people of “calibre” have, it is never enough.
They make me sick.
When does this end!!!
It will all make the Peoples Republic of Chinas case that much more easy won't it, that all that corruptly obtained PRC money was used to purchase houses against the laws of the Commonwealth of Australia.
It's amazing how the PRC is purchasing so much Australian residential property by proxy.
There have been two thought provoking commentaries from prestige Melbourne buyers' agents this week on the issue of prestige home sale to buyers of Chinese descent.
There was some silly coverage on the front page AFR on Monday. Quite inflammatory and mostly unhelpful as the AFR didn't address the easy way of solving the concern, that is 100 point required residential identification details within all contracts.
The more insightful perspective commentary has been published today on Property Observer from Mal James.
Under the online AFR headline, Foreigners illegally buy trophy homes in Sydney and Melbourne, or the printed version, Agents cash in on "illegal" foreign buyers, the high profile buyers’ agent David Morrell claimed foreign investment in Melbourne residential real estate was "rampant", particularly from mainland China with "real large scale flaunting of the current laws".
He said the lack of "cheques (sic) or balances was undermining and damaging the existing residential real estate market".
Particularly in the $10 million top end and in the $1.5 million to $3.5 million inner city Melbourne marketplace, said David Morrell.
But unfortunately he was very vague in actually assisting the parliamentary committee investigating foreign ownership with any documented examples.
He suggested there had been "many" transactions in the top end marketplace, in particular where a property has been on the market for 12 months and suddenly the Chinese national has purchased the property for a 20% premium to the relevant marketplace and local buyers.
"This of course causes a domino effect in the market where other vendors believe there properties are worth more and our prices local buyers."
His submission went onto say: "Clearly while there’s a law there’s no requirement in any contract that requires proof of residency to the person signing a document, we have seen on many occasions some distant relation actually sign a document that clearly has neither the ability or knowledge of what they’re actually doing.
"To give you some scale of the problem at a recent Toorak auction where the reserve was exceed by 30%, there were three Chinese nationals competing, neither spoke English or understood the process and literally just kept their hands in the air.
"This outrageousness is not only contained to an isolated incident," though his submission stopped at just this one unidentified example.
Meanwhile buyers agent Mal James wrote it was not just actual bidding that was "creating the near frenzied bidding response that we are seeing out there right now".
"Even when no Chinese Nationals are bidding, it’s the fear of Chinese nationals bidding that is also pushing prices up," he blogged.
"Ask any agent on an inner east home coming to auction and they will tell you we have some 'Chinese interest' – it is something firmly implanted in many agents’ “buyer scripts”.
"In other words, buyers not only bid as they do against Chinese national bidders but also on the fear that Chinese nationals may bid."
James went onto note that in his last 10 purchases he had been directly involved in (Kew, Camberwell, East Melbourne, Elwood, Camberwell, Glen Iris, Camberwell, Kew, Camberwell and Kew) that Chinese Nationals were the direct underbidder on five. They were used in the selling agents negotiating scripts twice. There was no Chinese bidding or no mention of Chinese bidders by agents on the other three.
James concluded by noting that Chinese nationals are also affected by the bidding or fear the bidding of other Chinese nationals.
The committee chair Kelly O'Dwyer represents Higgins, located in Melbourne's south-eastern suburbs.
It covers an area of approximately 40 sq km from Hughesdale in the south-east, South Yarra and Toorak in the north-west, Windsor in the south-west and Ashburton and Glen Iris in the east. The main suburbs include Armadale, Ashburton, Kooyong, Malvern, Malvern East, Prahran and Toorak along with parts of Carnegie, Glen Iris, Hughesdale, Murrumbeena, South Yarra and Windsor.
Getting up the 100 point identification initiative will require O'Dwyer to convince all the states and territories to adopt a uniform contract requirement which could coincide with the roll out of e-conveyancing which should allow greater transparency.
Her committee ought also introduce a foreign buyers' fee to assist in the compilation of better data on the occurrence, so that the authorities can monitor purchases and exit sales to ensure greater compliance, possibly even if the purchasing is via family members and companies.
Unfortunately until then we are left with mostly anecdotal snippets that don't always greatly assist our understanding amid the confusion between rightful local buyers of Chinese descent and those directly from mainland China who don't have any ownership entitlement.
Kelly O'Dwyer will deliver her findings by October 14.
Not all Chinese are really foreign investors. Local Chinese investors are also going crazy. I know of a couple who work in the health industry. One is a nurse and another is a physiotherapist, both are contacting for $100k p.a. each.
They have around 6 investment properties. Their strategy is to pay what ever price for large land and then build units. Using interest only loans and pretty much all the tricks in the book. Finally hope to sell at the end.
Now the amazing thing is that the husband also works at Woolworths several days a week after hours to be able afford lifes little extras like holiday and eating out.
Even more amazingly, the wife now just had a baby!
Chinese buyers are propping up the Australian economy. The old baby boomers are pocketing millions and are now either blowing that money on pokies or buying stuff to prop up Australian businesses. The rest of the money has probably now been invested in some Australian company. The income they make out of all that is now taxed. All I see is better outcome for all Australians. First home own buyers are not going to be buying $1+ million homes, they will be looking at $400k+ homes. Too bad they no longer exist near the CBD, it is not a “right” to live near the CBD.
Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.
Forum Rules:
The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.
Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.
Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.
This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.
Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ
Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy