Liberal MP and Chairwoman of the Parliamentary Inquiry into Foreign Investment in Residential Real Estate Kelly O’Dwyer believes the Foreign Investment Review Board (FIRB) has failed to enforce laws restricting investment in real estate by foreign investors.
Ms O’Dwyer told a forum last week that there was evidence presented at the inquiry that suggested the restrictions on foreign buyers, who cannot buy established homes without approval, were not being adequately enforced by the Board.
Ms O’Dwyer also added that while there have been suggestions the Board is under-resourced, she does not think that’s enough justification on why they have failed to follow through on enforcing standards.
“FIRB have demonstrated that they have not been doing their job in that regard,” Ms O’Dwyer said.
“I think there’s been a failure of leadership at FIRB.”
Ms O’Dwyer is leading a joint Coalition and Labor committee that is considering changes such as imposing extra stamp duty on foreign buyers or a charge on FIRB approvals.
She also criticised the Board for the lack of data compiled about offshore investment.
The committee has heard evidence that data published by the Board reflected only gross approvals by foreign buyers. The sale of these properties to Australian citizens or permanent residents, required for instance when temporary residents vacate the property, was not included.
Ms O’Dwyer said that rather than having enough timely or accurate data, there was a compilation of board approvals that did not always equate to sales and Australian Bureau of Statistics data.
“Policy needs to be made not by anecdote but by evidence,” she said.
She said the federal inquiry into offshore investment was not focused on cash inflow from one country, it includes every country that has people buying into Australian residential property.
The final report is due in October 2014.