Level heads lost in FIRB game

Real estate agents nationwide believe the level of illegal foreign investment in Australia is at a bare minimum and consider that just because someone beats you at auction or may look ‘foreign’ doesn’t mean they are in fact purchasing property illegally.

A parliamentary committee yesterday released findings into the amount of divestment orders issued by the Foreign Investment Review Board (FIRB) since 2003/2004 and discovered only 17 notices had been issued stating buyers had to sell illegally-acquired homes.

Estate agents believe even that number is high.

John Bongiorno, director of Marshall White Estate Agents, was ‘dobbed in’ to the FIRB by a rival agent over the purchase of a house in Victoria on September 20 for $2.75 million.

The purchases were made by an Australian citizen. Mr Bongiorno said he has over 100 selling agents and said he is yet to see any breaches of any foreign investment laws.

“I don’t think people would be silly enough to risk their money by doing something illegal in another country, and I certainly would not like to go overseas to buy property illegally - I would be terrified of losing my money and getting locked up,” Mr Bongiorno said.

“Just because someone looks foreign doesn’t mean they are fresh off an aeroplane and there is a fine line in suggesting someone is doing something illegal because of their language or looks… I have been saying for months and months that amongst all the hysteria we all should just take a deep breath.

“We got reported by a buyer’s agent who in my opinion was just seeking their own personal publicity.”

LJ Hooker estate agent Peter Robinson said he has only had one property sale go through correct due diligence in the last 24 months and two sales of blocks of land.

Mr Robinson said most of the foreign investment concerns should be directed to farmland and large properties in rural Australia. Mr Robinson believes these large pockets of land are where any future arguments should be happening – not high-end waterfront properties.

“A majority of people we sell to from overseas are expats and many are mega-wealthy and looking for high-end property close to a central business district, such as harbour fronts, and I don’t really think this is a major issue for real estate in New South Wales,” Mr Robinson said.

Rob Fletcher from Fletcher’s Real Estate said he is active in a very strong international area but has not seen any issue with property purchasing. Mr Fletcher is not sure what the FIRB is hoping to achieve.

“There are a lot of local areas with an enormous level of owner occupiers from overseas, but in my time I have not seen any illegal transactions or anything similar taking place,” Mr Fletcher said.

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