UK investor who illegally bought $700,000 Perth home will sell

A UK investor has admitted to being part of dodgy deal on his Perth home, which has brought the ire of Australia’s foreign investment regulators.

perth smoke

WITHIN weeks of the Federal Government announcing a crackdown on foreigners buying Australian property, another investor has come forward admitting to breaking the rules.

The British investor is one of 24 who have confessed to breaching foreign investment rules.

According to The West Australian, the investor who bought a $700,000 home in Perth will give up the property as part of the crackdown.

Treasurer Joe Hockey revealed today the Australian Taxation Office was investigating 195 cases of possible breaches.

These properties ranged in price from as little as $300,000 to a staggering $40 million.

If the British investor sells the Perth property, it will be the second since the government started targeting foreign purchases of Australian homes in March, The West Australian reported.

There are also rumours in Perth real estate circles that people on temporary residency visas, who are entitled to buy established homes as long as they sell them when they leave the country, had kept their properties as investments.

Of the 80,000 houses in Australia owned by temporary residents, 22 per cent are in WA.

The percentage in NSW is 26 per cent while Victoria has 25 per cent.

It was also revealed today that, in another case, one foreigner has 10 properties across two states.

Mr Hockey told reporters that 40 cases were under investigation following tip-offs from members of the public.

“This is the tip of the iceberg,” Mr Hockey said. “We have put very significant additional resources into the investigations, building up to 60 people by the 1st of July.

“The Australian Taxation Office is finding increasingly that there is the likelihood of taxation fraud as well as unlawful purchase of real estate by foreign entities.

“Foreign investors have been using trusts and … the bigger [the] property value, the more sophisticated the arrangements seem to be in relation to hiding the true nationality of the individual who owns the property.”

Investors have until November 30 to go to authorities.

“Foreign investors who think they may have broken the rules should come to us before we come to them,” Mr Hockey said.

From December foreigners who illegally buy residential properties will face fines of up to $127,500 or three years’ jail. Third parties who knowingly assist them face fines of up to $45,000 for individuals and $225,000 for companies.