Buying a home prior to your migration to Australia is always a good idea and may in fact create some significant tax advantages prior to your arrival.
Under Australian foreign investment laws, the only restriction for foreign investors acquiring property in Australia is that they must buy a newly built property or land provided that construction begins within 24 months.
It is not done as a deterrent, rather it is to keep our property market safe and ensure foreign investment creates jobs and increases the rental pool.
If you have already been granted an Australian Permanent Residency Visa, then this restriction does not apply and you can acquire property whether new or established.
If you are married to an Australian Citizen or permanent resident, you can also acquire established property provided it is acquired as joint tenants with your spouse. This includes defacto relationships.
Purchasing a property prior to arrival may also be very beneficial in some other important areas:
- It can protect against future Australian income tax on arrival as any holding cost on the property (rent less interest and expenses) is allow to accumulate as a tax deduction indefinitely. As such you can build up a sensible level of tax losses prior to arrival that can offset any Australian income tax on salary, investment or retirement income once you relocate.
- It may be easier to arrange financing prior to relocation while you are still gainfully employed rather than waiting until you have moved to Australia. This may make a better home even more accessible with finance readily available for up to 80% of any purchase price for non residents acquiring Australian property.
- You get to acquire the property at todays price rather than tomorrow. Australian property markets have proved their stability over many decades, so prices of property tend to hold firm and grow at a reasonable pace. The decision to delay purchase can make the eventual price of your home higher and increase the burden of loan that may be required. The earlier you acquire, the least cost is most likely.
Depending on your time horizon for relocation, acquiring a property that would suit your living requirements is a very wise decision and even if you may change your mind and chose to live elsewhere, it will stand as a safe and sensible investment decision that can be kept and continued to be let out, or sold to help pay for your new intended residence.
