If you’re moving to Australia for work or leisure and plan to buy property in the nation, there are a few important tips to take to heart so that the purchase process goes as smoothly as possible.
Making a financial decision as big as purchasing property in a foreign country should take time, allowing you to weigh up the pros and cons of sinking your funds into such a solid investment. With this in mind, it helps enormously if you really research every angle of your potential purchase. For example, if you are travelling alone to Australia to work, chances are that a flat will suit your needs far better than a large house, while moving over with a family is likely to require more spacious accommodation to keep everyone happy.
In the UK, the season of winter is December, January and February, while summer crosses June, July and August. In Australia, however, these distinctions are reversed and while ‘winter’ is still the coldest season in the nation, the average temperature in Australia is far higher than the average temperature in the UK throughout the year. Adjusting to the high-temperatures prevalent in Australia can take some time, especially if you are acclimatised to the UK’s milder weather conditions.
There’s no better way to get a sense of how a place suits you than visiting it in person, and when it comes to buying property, the process is no different. Australia has an ‘eVisitor’ visa (subclass 651) available for the purpose of short-term stays in the country of less than three months. This visa type is free for passport-holding British citizens and can be used for the purpose of taking a holiday in Australia while you learn how the country differs to the UK. This can be a good way to get to grips with different ways of doing things and you can use your research trip to seek out your perfect property.
Since December 2015, the purchase of property in Australian by foreign citizens has been under the jurisdiction of the Foreign Investment Review Board (FIRB). The FIRB evaluates attempts to purchase property by non-Australians based on their potential contribution to the national economy. In the case of buying a building to set up a business, for example, the plan has to be viable and job creation is a high priority. The FIRB is a complex system to navigate, so it may be worth contacting an Australian lawyer to ensure that you have every box ticked when presenting an application.
Buying sight unseen is, simply put, a major risk, but this doesn’t mean that you have to jet all the way across the world just to look around a house that you might not think is right. Thanks to new technologies in the field of home viewing, it is possible to take a look around display homes as if you were there yourself via ‘Streetview’-esque viewing options on the internet. Use an estate agent who offers virtual house tours if you want to make sure you’re getting what you’re paying for.
If you can’t purchase a property upfront and plan to use a mortgage to fund your house buy, then getting involved in a Regular Overseas Payment scheme (ROPs) can be immensely useful. This service, offered by some currency brokers, automates transfers overseas and allows you to benefit from competitive exchange rates and fee-free transfers. With payments geared up to be made on a day of your choosing, meeting regular mortgage payment is not only a doddle but more cost-effective.
Buying a property for the purpose of doing it up and selling on is a tried-and-tested practice, but it is worth researching the area to make sure this action will pay off. If there isn’t much demand for housing in the area, for example, or wages are particularly low, then it may be better off looking somewhere with greater demand.
If you have your heart set on the perfect property, such as a beachfront retreat for your retirement, but don’t want to immediately commit to such a momentous decision due to a lack of funds, for example, there is always the option of taking out a Forward Contract with a currency broker. This type of contract essentially ‘locks in’ an exchange rate for up to two years ahead of the transfer date. With a forward contract you’ll know in advance how much your transfer is worth and can budget more effectively.
While in the UK, London is far and away the most expensive place for property, in Australia this distinction is shared between Melbourne, Sydney, Brisbane and Perth. In addition to this factor, in Australia, describing a property as ‘rural’ usually translates to ‘remote’, which can be quite a shock when you have to trek out into the Outback to find it.
With urban and rural environments often meeting sharply in Australia, taking on a property may also mean that you are also taking on a sizable expanse of workable soil or shrub. Whether it’s setting up a lawn or establishing conditions for crops, high levels of irrigation are a must, owing to the general dryness of the country as well as the often long periods between heavy rainfall.
If you bear these tips in mind when making the key decisions around a property purchase in Australia, you can’t go far wrong. As with any major financial decision, it’s worth doing your homework beforehand, so that any potential issues are identified in advance and you get your money’s worth out of what could well be the investment of a lifetime.