Foreign Buyer Home Loans Australia 2026-27: FIRB, State Surcharges & Lender Policies

Australia's stance on foreign property buyers has tightened significantly in 2026-27. The ban on foreign purchases of established dwellings has been extended to 30 June 2029. State-level surcharges on stamp duty now range from 7% to 9%, with annual land tax surcharges adding ongoing costs. FIRB application fees scale from $15,100 to over $272,700 depending on property value. And enforcement is ramping up, with approximately 300 divestment orders issued in 2024-25 compared to fewer than 50 in 2018-19.

Here is what foreign buyers — including temporary residents, expats, foreign investors, and non-resident borrowers — need to know about getting a home loan in Australia in 2026-27.

What Can Foreign Buyers Purchase?

The established dwelling ban, originally set to expire in March 2027, was extended by two years and three months in the 2026 Budget. It now runs to 30 June 2029.

Still allowed:

• New dwellings (off-the-plan, newly constructed)
• Vacant residential land (with 4-year build commitment)
• Commercial property (separate regime)
• Replacement dwellings (demolish an existing home and rebuild)

Still banned:

• Established homes
• Existing units and apartments
• Second-hand dwellings, even if renovated

Narrow exemptions exist for:

• Housing supply pathway: commit to rent or redevelop within 2 years
• Temporary residents buying a principal place of residence (must sell on departure)
• Inherited property
• Spouse of an Australian citizen or permanent resident

Both major parties have signalled they intend to further tighten rules. Foreign buyers should not expect a return to pre-2025 flexibility.

FIRB Fees: What It Costs to Apply

Foreign Investment Review Board application fees are indexed annually. For 2025-26 rates (expect indexation for 2026-27):

New or near-new dwellings:

• Up to $1,000,000: $15,100
• $1,000,001 to $2,000,000: $30,300
• $2,000,001 to $3,000,000: $60,700
• $3,000,001 to $4,000,000: $90,900
• $4,000,001 to $5,000,000: $121,200
• $5,000,001 to $10,000,000: $181,800
• Over $10,000,000: $272,700 plus scaling

Established dwellings: Approximately 3 times higher than new dwelling fees. A $1,000,000 established dwelling application (if permissible through an exemption) costs approximately $45,300.

Annual vacancy fee: Double the original FIRB application fee for foreign-owned dwellings not occupied or available for rent for more than 183 days in a vacancy year. This is enforced by the ATO with expanded funding and data matching.

State Surcharges: The 7% to 9% Layer

On top of FIRB fees and standard stamp duty, every state except NT imposes a foreign buyer surcharge. These are calculated on the full dutiable value and paid at settlement.

Example: NSW foreign buyer purchasing a $1,000,000 new apartment.

• Standard stamp duty: approximately $40,535
• Foreign surcharge (9%): $90,000
• Total stamp duty at settlement: approximately $130,535
• FIRB application fee: approximately $15,100 (up to $1M)
• Annual land tax surcharge: 5% of unimproved land value with no threshold

The surcharge alone on a $1 million property is equivalent to a 9% deposit — a significant barrier.

Foreign Buyer Home Loans: What Lenders Offer

Most major Australian banks and non-bank lenders offer home loans to foreign buyers, but with restrictions:

Loan-to-Value Ratio (LVR): Typically capped at 60% to 70% for foreign borrowers, meaning a 30% to 40% deposit is required. Some lenders go to 80% in specific circumstances.

Interest rates: Foreign buyer loans are priced higher than domestic owner-occupier loans, typically 0.5% to 1.0% above standard variable rates.

Income assessment: Foreign income is assessed at 60% to 80% of its face value by most lenders, reflecting currency risk and verification challenges. Income in countries with strong banking systems and tax transparency (UK, US, Singapore, Hong Kong) is more favourably assessed than income from other jurisdictions.

Accepted visa types: Temporary residents on 457/482 visas, student visa holders, and foreign investors without an Australian visa are all eligible, but lender policies vary significantly. A broker with foreign-buyer expertise is essential.

Enforcement Has Escalated

The ATO administers foreign investment compliance with expanded funding and data matching capabilities. Penalties include:

• Civil penalties: Up to $4.7 million for corporations, $940,000 for individuals
• Criminal penalties: Up to 10 years imprisonment
• Divestment orders: Approximately 300 issued in 2024-25 (up from under 50 in 2018-19)

The message is clear: compliance is being enforced at a level not previously seen.

The NT: The Foreign Buyer Exception

The Northern Territory is the stand-out jurisdiction for foreign buyers. It imposes:

• No foreign buyer stamp duty surcharge
• No land tax at all — zero annual holding cost
• No foreign owner land tax surcharge
• The HomeGrown Territory Grant of $50,000 is not available to foreign buyers (requires citizenship or PR), but the Territory Home Owner Discount provides full stamp duty exemption up to $500,000 regardless of residency status

The catch: FIRB rules still apply at the federal level, and lending options for foreign buyers in the NT are more limited than in major capital cities.

Tax Implications for Foreign Buyers

Income tax: Foreign residents pay tax from the first dollar earned (no tax-free threshold). Rates start at 30% up to $135,000, 37% to $190,000, and 45% above $190,000. No Medicare levy applies.

Capital gains: Foreign residents do not get the 50% CGT discount on gains after 8 May 2012. The new CGT indexation system from 1 July 2027 applies equally to residents and foreign residents. The FRCGW withholding rate is 15% on all Australian real property sales (since 1 January 2025) with no minimum property value threshold. Foreign residents can apply for a variation notice if the 15% withholding exceeds their expected liability.

Negative gearing quarantining: From 1 July 2027, rental losses on established property acquired after 7:30 PM 12 May 2026 can only offset rental income or residential property CGT. This affects foreign owners who previously deducted rental losses against Australian rental income.

FAQ

Can I buy an established home as a foreign buyer in 2026-27? Generally no. The ban on established dwellings runs to 30 June 2029. Narrow exemptions exist for temporary residents buying a principal place of residence (must sell on departure), those committing to redevelop within 2 years, inherited property, and spouses of Australian citizens or PRs.

Which state has the lowest foreign buyer surcharges? NT has zero surcharges. SA charges 7% stamp duty surcharge but no annual land tax surcharge, making it the cheapest mainland option for ongoing holding costs. WA at 7% is the next lowest. NSW at 9% plus 5% annual land tax surcharge is the most expensive.

How much deposit do I need as a foreign buyer? Typically 30% to 40% of the purchase price. Most lenders cap LVRs for foreign borrowers at 60% to 70%. The surcharge and FIRB fee must be funded in addition to the deposit.

Does the $50K NT HomeGrown grant apply to foreign buyers? No. The HomeGrown grant requires at least one applicant to be an Australian citizen or permanent resident. However, the Territory Home Owner Discount (full stamp duty exemption up to $500,000) applies to anyone who does not currently own NT residential property, regardless of residency status.

What happens if I don't comply with FIRB rules? Civil penalties up to $4.7 million for corporations, $940,000 for individuals, and potential criminal penalties of up to 10 years imprisonment. The ATO has significantly expanded enforcement, with divestment orders up from under 50 in 2018-19 to approximately 300 in 2024-25.