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One West Australian buyer’s agent has called for a rework of state and federal policies to better incentivise foreign workers into the state’s struggling workforce.
With most of the weekly inquiries from international workers enticed by working and purchasing a home in the state losing interest by the necessary taxes they would need to pay, Peter Gavalas, buyer’s agent at Resolve Property Solutions, believes change is needed.
“The minute I tell them about the additional stamp duty that foreign buyers get charged and the Foreign Investment Review Board (FIRB) application fees, they’re shocked and often say they can’t afford to buy,” he explained.
While “some decide to rent instead”, he added, “others give up on Western Australia altogether and decide to migrate to another Australian state”.
Currently, foreign investors must apply to FIRB at a cost of $13,200 for a property valued between $75,000 and $1 million, with Mr Gavalas stating he yearns for the federal government to “show some flexibility” over the board. He did caveat that “it’s probably a bit much to expect them to change a national policy just for Western Australia”.
However, given stamp duty is a state-based taxation scheme — and one which charges foreign an extra 7 per cent in stamp duty, he believes “the Western Australian government can absolutely reduce or eliminate foreign transfer duty”.
Overseas workers who purchase a $600,000 home in the state — $40,000 above the median price in Perth — face an additional $78,715 in regular stamp duty charges, foreign buyer stamp duty charges, and FIRB fees.
With a 3.5 per cent unemployment rate, the state needs workers. Mr Gavalas outlined: “The easier we make it for overseas workers to move to WA, buy a home, and invest in our state, the more people we’ll attract.
“[This] is crucial when every part of our economy is so desperate for workers.”
Mr Gavalas explained the state’s alarmingly low vacancy rate — 0.4 per cent — provides further motivation to incentivise foreign workers to buy rather than rent as “the last thing we want to do is increase tenant competition”.
Even with the McGowan government’s August announcement, it was temporarily altering its migration program to boost the state’s appeal to migrant workers; these changes were limited to waiving the $200 application fee, halving the requirement to have an employment contract to six months, and reducing requirements for applicants to demonstrate sufficient funds.
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