Andrew Gee (Calare, Independent) Share this | Hansard source

I move:

That this bill be now read a second time.

I rise to introduce the Prohibition on the Purchase of Residential Property by Foreign Entities Bill 2024.

The great Australian dream of home ownership was once the birthright of every Australian.

But in recent times, hardworking Australians, no matter how hard they strive and no matter how much they save, have been locked out of the residential property market.

The great Australian dream is slipping away before our eyes.

It's clear: immediate action is needed to ease demand and crack this housing crisis.

Boosting housing supply is going to take a long time, perhaps decades. A ban on cashed-up foreign buyers purchasing Aussie homes would take pressure off the market straight away, and that is the aim of this bill.

Clause 6 of the bill introduces a prohibition on non-Australians and foreign entities purchasing residential property during the two-year period starting on commencement of the act.

Noncitizens, non-permanent residents and foreign controlled companies will be included in this prohibition.

It covers the purchase of residential property either directly or indirectly, alone or jointly.

It does not apply if a non-Australian is purchasing property jointly with a spouse or de facto partner who is an Australian citizen or permanent resident.

Properties purchased for diplomatic or consular purposes are also not caught by the prohibition.

There obviously need to be penalties for breaching the provisions of this bill, and these are also provided in clause 6.

The penalty for contravening the prohibition is 800 penalty units, which equates to $250,000.

This in itself is a substantial monetary penalty; however, for wealthy offending foreign corporations this may not be a large enough fine.

In this regard, it's important to note that pursuant to section 4B(3) of the Crimes Act 1914, a penalty of five times this amount may be imposed upon an offending foreign corporate entity, which equates to $1.25 million.

Importantly, the bill also provides for the Federal Court of Australia to order the disposal of foreign-held residential property that contravenes the prohibition in the bill.

An application for disposal would need to be made by the minister, and the court would have the power to make such an order in such a manner and under such conditions as the court deemed appropriate.

In keeping with paragraph 51(xxxi) of our Constitution, the order for disposal could not contravene our Constitution and could not be otherwise than on just terms—that's an important safeguard.

This bill is not about turning our backs on the wider world.

Rather, it's about making thousands more homes available to hardworking Australians.

It's about helping Australian homebuyers, especially first-home buyers, finally get a foothold on the residential property ladder.

It's about helping more Australians get their shot at the great Australian dream.

The latest available data on foreign investment in residential real estate covers the 12 months to June 2022. This period included the COVID-19 pandemic global lockdowns, which undoubtedly would have affected the number of homes bought by non-Australians, given that they could not travel here.

In the years since June 2022, regularity has returned to the housing market, so anecdotally the current figures would be much higher. In any case, the data reveals a real problem that this bill aims to help solve.

In the year to June 2022, 4,228 homes were snapped up by foreign buyers. That scarce housing stock could have gone to 4,228 Aussies, desperate for a home to call their own, who are being crowded out of the market.

Now, more than 75 per cent of these properties sold for less than $1 million. The year before, in the 12 months to 2021, 83 per cent of the homes purchased by foreign buyers were under $1 million.

That shows that foreign buyers and foreign speculators are snapping up entry-level homes.

That's a shocker of a statistic for young families and first homebuyers trying to get their first start.

And in the five years to June 2022, almost 37,000 residential properties on our shores were snapped up by foreign buyers. That's a huge number of homes that could've been the first rung on the property ladder for Australians.

Constituents of the Calare electorate are frequently contacting me to indicate just how difficult it is to find an affordable place to purchase or rent in our area.

The fact is, when demand increases in a city, speculators look to park their wealth in properties located in regional centres and thriving towns—causing regional house and rental prices to skyrocket.

Allowing foreign buyers to snap up Aussie homes adds unnecessary heat to the housing market that so many are finding themselves locked out of.

It's a vicious cycle.

By banning foreign buyers from the residential property market for two years, more housing would be available for Australians, which would be part of the solution to the housing affordability crisis.

Importantly, this is a measure that can make a real difference quickly—it's much faster to implement this bill than build tens of thousands of new homes to make up for those bought by foreign investors.

The government needs to bring this bill on for debate on the double.

In these difficult economic times, we need to be putting the interests of Australians ahead of wealthy foreign property speculators.

The bill would bring the goal of home ownership into reach for thousands more Australians each year by banning foreign buyers from snapping up homes on our shores.

It has been modelled upon a similar piece of legislation that was passed into law by the Trudeau government in Canada.

This month, Canada announced it would be extending its ban on foreign home purchases in Canada for two extra years to 2027.

They are not our only Commonwealth cousin to do so. New Zealand has a similar measure, as does Singapore.

It's not enough just to believe in the great Australian dream.

It's our role as members of parliament to empower Aussies to achieve it. This bill does just that.

I commend the bill to the House, and I cede the rest of my time to the member for Mayo.

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