Peter Dutton wants to ban foreign buyers from purchasing real estate in Australia

Opposition Leader Peter Dutton has unveiled his plan to help increase the supply of housing for Australians amid a national housing shortage.

The Liberal MP announced on social media this week that he would ban foreign buyers from buying property in Australia for two years.

‘Imagine this: you work hard, stay inside while everyone else leaves, so you can save some more and finally have enough to buy your first house, so you make a good offer only to be outbid by someone who doesn’t do. I even live in this country,” he said.

‘It is a situation that many first home buyers are currently facing and that is why, if I am the next Prime Minister, I will work to ban foreign investors and temporary residents from buying existing homes for two years.

‘This gives young people a fair chance at a first home. It’s time to prioritize Australians who are working hard to enter the market.

“We will ensure the homes go to those who need them most, Australians.”

About 1.2 million new homes need to be built over the next five years to meet demand, according to targets agreed by federal and state governments.

But JLL Research and Housing Australia predict this target will not be met with a shortage of around 197,847 homes by 2027.

The video received a flood of responses from many who agreed with Mr Dutton that supply would increase, but others claimed it would have a small effect.

“Alright Pete, make it ten years and you’ve got a winner,” said one.

“Make it permanent, Australia for Australians,” another added.

“Foreign ownership should never have been allowed in the first place,” said a third.

“We need a tough leader, I hope you are the next PM,” said a fourth.

But others said the small number of foreigners buying homes was not contributing to the housing shortage.

“You try to divide it along nationalist lines by saying ‘Australians’, but it’s really class lines: the rich with their investment properties, while young people have none,” one person argued.

‘We just need to build more houses. Increase supply,” said another.

“Negative gearing should be limited to just one property,” said a third, referring to tax breaks real estate investors receive.

“In Queensland, the problem is that buyers from Sydney and Melbourne are offering 20 to 30 per cent more and buying multiple homes after selling there. Interstate purchases should be restricted,” said a fourth.

A fifth argued that banning foreign buyers would make auctions less competitive and those selling their homes would suffer.

Australian Taxation Office figures show foreign buyers made a total of 5,360 purchases worth $4.9 billion in 2022-2023, compared to 4,228 worth $3.9 billion in 2021-2022.

Buyers from China, Hong Kong and India topped the pack, with the average purchase price reaching $914,000.

However, according to official figures, foreign buyers make up only about 1 percent of all residential purchases.

Figures also show that the nationally agreed target of building 1.2 million additional homes by July 2029 is in danger of falling woefully short.

The number of residential permits fell by 6.1 percent in August.

In September, Master Builders Australia predicted only 1.03 million of the 1.2 million targeted homes would be built, finding each state backed their individual targets.

The top building and construction body said if the pace of last year continued, Australia would be 365,000 homes short.

According to Australian Bureau of Statistics data released on Tuesday, approvals for detached houses increased by just under 0.5 per cent nationally, but for other properties – including apartments – the total number fell by a drop of 16.5 percent.

MBA chief executive Denita Wawn said a “strong and consistent” supply of high-density housing was key to solving the housing crisis.

‘With the number of higher density building permits now lower than a year ago, the data reinforces the need for serious action on inflation to encourage new home ownership and get more private investors into the market to generate urgently needed new homes she said.

NSW and South Australia recorded the biggest falls, both reporting an 11.5 per cent drop in approvals.

All states experienced a month-on-month decline of at least three percent.

Slow planning systems – which NSW Premier Chris Minns routinely blames for his state’s lackluster progress – and “apartment killer taxes” were the driving force behind the decline, the Property Council of Australia said.

Only 1,200 apartments in blocks of nine or more floors were approved in August, compared to 2,500 in July.

“We need to increase the number of approved homes and ensure a strong pipeline of apartment supply to achieve our housing goals at scale,” said the council’s Matthew Kandelaars.

“But the reality is that it has never been more difficult and expensive to take apartments out of the ground.”

Oxford Economics Australia senior economist Maree Kilroy said the data suggested the worst was over for the approval of detached homes, but apartments were a completely different story.

Home construction starts are forecast to increase by six percent this fiscal year, she said.

“Reductions in mortgage rates will help release pent-up demand for housing, while traction on the housing policy front will become increasingly evident… but industry capacity will act to limit the speed of the recovery,” Ms Kilroy said .

Approvals for detached homes rose 3.9 per cent in NSW, 1.9 per cent in WA and 1.4 per cent in Victoria.

But in South Australia they fell by four percent and in Queensland by 3.9 percent.