Canberra – The Australian government has enacted a two-year ban on foreign home purchases, a measure aimed at boosting housing availability amid an ongoing housing crisis. The ban, which takes effect on April 1, 2025, is expected to free up approximately 1,800 properties for domestic buyers.
Australian Treasurer Jim Chalmers stated that the policy will be reviewed after March 31, 2027, to determine whether an extension is necessary.
Housing Crisis at the Centre of Political Debate
Housing affordability has become a major economic and political issue in Australia, particularly after the crisis worsened last year. With a general election set for May 2025, the policy is widely seen as an attempt to address voter concerns about the housing shortage.
The National Housing Finance and Investment Corporation has projected a deficit of approximately 106,000 homes this year, further highlighting the urgency of the issue.
According to Chalmers, the crackdown on foreign land banking is intended to ease pressure on the housing market, making homes more accessible to Australians. While acknowledging the policy’s limited scope, he emphasised that it represents a meaningful step in ensuring that properties remain available for local buyers rather than being snapped up by international investors.
Global Precedents and Legal Constraints in the EU
Several countries have explored restrictions on foreign real estate purchases to control housing prices and mitigate supply shortages. However, implementing such measures in the European Union presents legal challenges.
Under EU law, citizens have the right to live and buy property in any member state under the same conditions as nationals of that country. This includes primary residences, vacation homes, and commercial properties, making an outright ban on foreign buyers legally unfeasible in Ireland and other EU nations.
Nonetheless, some EU countries—including Malta, Sweden, Portugal, Spain, and Austria—have introduced tax increases and other regulations to limit foreign real estate purchases.
Ireland’s Previous Consideration of Similar Measures
In 2018, Fianna Fáil’s Darragh O’Brien urged then-Housing Minister Eoghan Murphy to assess restrictions on foreign individuals and institutions purchasing homes in Ireland. However, after assuming the role of Housing Minister, O’Brien reversed his stance, citing legal obstacles that prevent Ireland from enacting such a policy.
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