Understanding FIRB 2026: A Step-by-Step Guide for Temporary Residents
Navigate FIRB Approval, Avoid Costly Mistakes, and Buy Your Australian Home with Confidence
By Rajesh Kandel | Everest Home Loans | Updated January 2026
📋 Table of Contents
- Introduction: Why FIRB Matters in 2026
- What is FIRB and Do You Need It?
- The 2025-2026 FIRB Fee Schedule
- What Properties Can You Buy?
- The Vacancy Fee Trap (Critical!)
- Step-by-Step FIRB Application Process
- Documents Required for FIRB
- FIRB Application Timeline
- Foreign Buyer Stamp Duty Surcharges
- Ongoing Compliance Requirements
- Common FIRB Mistakes to Avoid
- FIRB Exemptions and Special Cases
- Frequently Asked Questions
- How Everest Home Loans Can Help
Introduction: Why FIRB Matters in 2026
For many in the Nepali and Indian diaspora, the path to homeownership in Australia begins before you receive your Permanent Residency (PR). If you are currently on a temporary visa—such as a 482 (TSS), 491 (Regional), 485 (Graduate), or 500 (Student)—one of the most critical hurdles you will face is the Foreign Investment Review Board (FIRB).
In 2026, the rules around foreign investment have tightened, and the costs have increased significantly. At Everest Home Loans, we believe that understanding these regulations is the key to avoiding expensive delays and legal pitfalls.
⚠️ Critical Warning: Non-Compliance Can Cost You Thousands
Purchasing property without FIRB approval when required can result in:
- Forced sale of the property
- Criminal penalties up to $135,000 for individuals
- Civil penalties up to $675,000
- Imprisonment up to 3 years
- Annual vacancy fees if property is not occupied
Don't risk it. Get FIRB approval before signing any contract.
This comprehensive guide explains everything a temporary resident needs to know about FIRB in 2026, including:
- Updated fee schedules and how they've changed
- What types of properties you can and cannot buy
- The dangerous vacancy fee trap and how to avoid it
- Step-by-step application process with timelines
- State-by-state foreign buyer stamp duty surcharges
- Ongoing compliance requirements
- Common mistakes and how to avoid them
What is FIRB and Do You Need It?
FIRB is the Foreign Investment Review Board, an Australian government body that oversees foreign investment in local real estate. Under Australian law, "foreign persons"—which includes most temporary visa holders—must generally apply for and receive approval before they can legally purchase a property.
Who is Considered a "Foreign Person"?
You are classified as a foreign person if you are:
- Temporary visa holder: 482 (TSS), 491 (Regional), 485 (Graduate), 500 (Student), 820/309 (Partner - temporary)
- Non-resident: Living outside Australia
- Foreign company: Company incorporated overseas or controlled by foreign persons
Who is NOT a Foreign Person?
You are NOT a foreign person if you are:
- Australian citizen
- Permanent resident: Subclass 189, 190, 186, 887, 801, etc.
- New Zealand citizen on a Special Category Visa (subclass 444)
✅ Important Exception: Joint Purchase with PR/Citizen
You typically do not need FIRB approval if you are buying a property as "joint tenants" with a spouse or partner who is an Australian citizen or permanent resident, provided:
- Both names are on the title
- Property is for residential use
- PR/citizen spouse has at least 50% ownership
However, you may still be subject to foreign buyer stamp duty surcharges in some states. Check with your solicitor.
Do I Need FIRB Approval?
| Your Situation | FIRB Required? | Notes |
|---|---|---|
| Temporary visa holder buying alone | ✓ YES | Must apply before signing contract |
| Temporary visa holder buying with another temporary visa holder | ✓ YES | Both must be listed on FIRB application |
| Temporary visa holder buying with PR/citizen spouse (joint tenants) | ✗ NO | Exemption applies if both on title |
| Permanent resident buying alone | ✗ NO | Treated same as Australian citizen |
| Australian citizen buying alone | ✗ NO | No restrictions |
| Non-resident (living overseas) | ✓ YES | Stricter rules apply |
The 2025-2026 FIRB Fee Schedule
FIRB fees are revised annually and are based on the value and type of the property. For the current financial year (ending June 30, 2026), the fees have reached a new high:
| Property Value | New/Near-New Dwelling Fee | Established Dwelling Fee | Vacant Land Fee |
|---|---|---|---|
| Up to $1 Million | $15,100 | $45,300 | $15,100 |
| $1M - $2M | $30,300 | $90,900 | $30,300 |
| $2M - $3M | $60,600 | $181,800 | $60,600 |
| $3M - $4M | $121,200 | $363,600 | $121,200 |
| $4M - $5M | $181,800 | $545,400 | $181,800 |
| $5M+ | Contact ATO for fee calculation | ||
⚠️ Why Are Established Dwelling Fees 3x Higher?
The fee for established dwellings is significantly higher (3x the fee for new dwellings) to encourage foreign buyers to invest in new housing supply rather than competing with Australian residents for existing stock.
This policy aims to:
- Increase housing supply through new construction
- Reduce competition for existing homes
- Support the construction industry
- Create jobs in the building sector
Fee Increases Over Time
FIRB fees have increased significantly over the past few years:
| Financial Year | New Dwelling (up to $1M) | Established Dwelling (up to $1M) | % Increase |
|---|---|---|---|
| 2020-2021 | $5,900 | $17,700 | - |
| 2021-2022 | $6,100 | $18,300 | +3.4% |
| 2022-2023 | $7,200 | $21,600 | +18% |
| 2023-2024 | $13,200 | $39,600 | +83% |
| 2024-2025 | $14,300 | $42,900 | +8.3% |
| 2025-2026 | $15,100 | $45,300 | +5.6% |
🚨 Critical: FIRB Fees Are NON-REFUNDABLE
FIRB application fees are 100% non-refundable, even if:
- Your application is rejected
- You decide not to proceed with the purchase
- The property sale falls through
- You change your mind
Make absolutely sure you're serious about the property before applying for FIRB approval.
What Determines the Fee?
The FIRB fee is based on the purchase price or market value of the property (whichever is higher). This includes:
- Purchase price stated in the contract
- Any additional payments to the seller
- Value of any non-cash consideration
Example: If you're buying a property for $950,000, you'll pay the fee for the "up to $1 million" bracket ($15,100 for new dwelling or $45,300 for established dwelling).
What Properties Can You Buy?
As a temporary resident in 2026, the type of property you can purchase comes with strict conditions. Understanding these rules is crucial to avoid non-compliance penalties.
1. New Dwellings
✅ New Dwellings: Most Flexible Option
What you can do:
- Buy unlimited number of new dwellings
- Use as investment properties (rent them out)
- Use as primary residence
- No requirement to sell when you leave Australia
- Can leave vacant (but beware vacancy fee!)
What qualifies as a "new dwelling"?
- Property has never been previously sold or occupied as a residence
- Off-the-plan apartments or townhouses
- Newly built houses (never lived in)
- Property where substantial renovations have been completed (must increase value by at least 50%)
⚠️ "Near-New" vs. "New"
A property is only considered "new" if it has never been sold or occupied. A property that was built 6 months ago but has been lived in or sold is considered "established," not "new."
Always verify with the developer or seller that the property qualifies as "new" for FIRB purposes.
2. Established Dwellings
⚠️ Established Dwellings: Strict Restrictions
What you can do:
- Buy ONLY ONE established dwelling
- Must use as your primary residence (you must live in it)
- Can have one boarder/lodger (not a tenant)
What you CANNOT do:
- Cannot rent it out while you live elsewhere
- Cannot leave it vacant for more than 6 months
- Cannot buy multiple established dwellings
- Must sell within 3 months if you move out or visa expires
What qualifies as an "established dwelling"?
- Any property that has been previously sold or occupied
- Existing houses, units, townhouses, apartments
- Properties that are currently tenanted
- Properties that have been lived in, even if only briefly
3. Vacant Land
📊 Vacant Land: Build Within 4 Years
What you can do:
- Purchase vacant land for residential development
- Build your own home
- Develop multiple dwellings (subject to council approval)
Requirements:
- Must commence construction within 4 years of purchase
- Must complete construction within 4 years of commencement
- Can sell before construction if FIRB approval is transferred to new buyer
⚠️ Failure to Build = Penalties
If you fail to commence or complete construction within the required timeframes, you may face:
- Forced sale of the land
- Civil penalties
- Annual vacancy fees
Property Type Comparison
| Feature | New Dwelling | Established Dwelling | Vacant Land |
|---|---|---|---|
| Number Allowed | Unlimited | One only | Unlimited |
| Can Rent Out? | ✓ Yes | ✗ No | N/A |
| Must Live In? | ✗ No | ✓ Yes | N/A |
| Must Sell When Leaving? | ✗ No | ✓ Yes | ✗ No |
| FIRB Fee (up to $1M) | $15,100 | $45,300 | $15,100 |
| Vacancy Fee Risk | High | Medium | High |
| Construction Required? | ✗ No | ✗ No | ✓ Yes (4 years) |
Which Property Type Should You Choose?
💡 Decision Guide
Choose a NEW DWELLING if:
- You want to rent it out as an investment
- You're not sure how long you'll stay in Australia
- You want flexibility to move without selling
- You want to build a property portfolio
Choose an ESTABLISHED DWELLING if:
- You're definitely going to live in it
- You're on a pathway to PR
- You want more choice of locations
- You want better value per square meter
- You can afford the higher FIRB fee ($45,300 vs $15,100)
Choose VACANT LAND if:
- You want to build your dream home
- You have time and budget for construction
- You can commit to 4-year construction timeline
- You want maximum customization
The Vacancy Fee Trap (Critical!)
A major risk for foreign investors in 2026 is the Annual Vacancy Fee. This is one of the most misunderstood and costly aspects of FIRB compliance.
🚨 What is the Vacancy Fee?
If your property is not occupied or genuinely available for rent for at least 183 days (approximately 6 months) in a calendar year, you may be charged an Annual Vacancy Fee.
In 2026, this fee is DOUBLE your original FIRB application fee.
Example: For a $1 million new dwelling:
- Original FIRB fee: $15,100
- Annual vacancy fee: $30,200 per year
This fee is charged every year the property remains vacant or not genuinely available for rent.
When Does the Vacancy Fee Apply?
The vacancy fee applies if your property is:
- Vacant (not occupied by anyone) for more than 183 days
- Not genuinely available for rent for more than 183 days
- Occupied by you for less than 183 days (if you're overseas)
- Under renovation for more than 183 days (unless you have an exemption)
Vacancy Fee Calculation Examples
| Property Value | Original FIRB Fee | Annual Vacancy Fee | 5-Year Vacancy Cost |
|---|---|---|---|
| $500,000 (new) | $15,100 | $30,200 | $151,000 |
| $1,000,000 (new) | $15,100 | $30,200 | $151,000 |
| $1,500,000 (new) | $30,300 | $60,600 | $303,000 |
| $2,000,000 (new) | $30,300 | $60,600 | $303,000 |
Note: These fees compound quickly. A vacant $1M property costs $30,200 per year in vacancy fees!
How to Avoid the Vacancy Fee
✅ Strategies to Avoid Vacancy Fees
1. Live in the Property
- Occupy the property as your primary residence for at least 183 days per year
- Keep evidence of occupancy (utility bills, council rates, etc.)
2. Rent It Out
- Ensure property is genuinely available for rent for at least 183 days
- List with a real estate agent
- Set a market-rate rent (not artificially high to avoid tenants)
- Keep records of advertising, inspections, and rental applications
- If property is rented for less than 183 days, ensure it was genuinely available for the full period
3. Sell Before Leaving Australia
- If you're leaving Australia permanently, sell the property before you go
- This avoids both vacancy fees and potential forced sale penalties
4. Apply for Exemption
- Exemptions may be granted for major renovations, natural disasters, or other exceptional circumstances
- Must apply to the ATO with supporting evidence
Vacancy Fee Reporting Requirements
You must submit an Annual Vacancy Fee Return to the ATO by June 30 each year, declaring:
- Number of days the property was occupied
- Number of days the property was genuinely available for rent
- Evidence of occupancy or rental availability
- Any exemptions you're claiming
⚠️ Failure to Lodge = Automatic Vacancy Fee
If you fail to lodge your Annual Vacancy Fee Return by the deadline, the ATO will automatically assume your property was vacant and charge you the vacancy fee, plus penalties for late lodgment.
Always lodge your return on time, even if the property was occupied all year.
Evidence of Occupancy/Availability
Keep detailed records to prove your property was occupied or available for rent:
For Owner-Occupied Properties:
- Utility bills (electricity, gas, water) in your name
- Council rates notices
- Bank statements showing local transactions
- Employment records showing you worked locally
- School enrollment records for children
For Rental Properties:
- Rental agreements with tenants
- Property management agreements
- Advertising records (realestate.com.au, domain.com.au listings)
- Inspection records and applications
- Rent receipts and bank statements
- Evidence of market-rate pricing
Step-by-Step FIRB Application Process
Here's exactly how to apply for FIRB approval in 2026:
Identify the Property
You must have a specific property in mind, as FIRB approval is tied to a specific address. You cannot get "general" FIRB approval to buy any property.
Add a "Subject to FIRB" Clause
When making an offer, ensure your solicitor adds a clause that the contract is conditional on FIRB approval. This protects you if FIRB rejects your application. Standard cooling-off periods don't apply while waiting for FIRB.
Gather Required Documents
Collect all necessary documents (see detailed list below). Ensure all foreign documents are NAATI-certified translated into English.
Submit via the ATO Portal
Applications are submitted through the ATO's Foreign Investment Portal (not the FIRB website). You'll need to create an account and complete the online application form.
Pay the Application Fee
The 30-day statutory decision clock does not start until the correct fee is paid. Pay immediately after submitting your application to avoid delays.
Wait for Approval
While the official timeframe is 30 days, current 2026 processing times are ranging between 30 to 90 days depending on complexity. The ATO may request additional information during this time.
Receive Decision
If approved, you'll receive a FIRB approval certificate via email. This is valid for 12 months from the date of issue. If rejected, you cannot proceed with the purchase (and fees are not refunded).
Proceed with Settlement
Once approved, you can proceed with your home loan and settlement. Make sure to settle within the 12-month validity period of your FIRB approval.
Ongoing Compliance
After settlement, you must comply with all FIRB conditions, including lodging Annual Vacancy Fee Returns and selling if you leave Australia (for established dwellings).
Documents Required for FIRB Application
📄 Complete Document Checklist
Personal Identification:
- Passport (certified copy of photo page)
- Visa grant notice (VEVO printout)
- Australian driver's license (if you have one)
- Proof of Australian address
Property Documents:
- Signed contract of sale
- Property details (address, lot/plan number, property type)
- Evidence property is "new" (if claiming new dwelling status)
- Developer's statement (for off-the-plan purchases)
Financial Documents:
- Evidence of funds to complete purchase (bank statements or loan pre-approval)
- Source of funds declaration
- If using overseas funds: NAATI-certified translation of foreign bank statements
Statutory Declarations:
- Declaration of intended use (primary residence, investment, etc.)
- Declaration that you understand FIRB conditions
- Declaration of compliance with vacancy fee requirements
FIRB Application Timeline
Day 0: Submit Application
Submit complete application via ATO portal with all required documents.
Day 1-2: Pay Fee
Pay FIRB application fee. 30-day clock starts from payment date.
Day 3-7: Acknowledgment
Receive acknowledgment email from ATO confirming receipt.
Day 7-30: Assessment
ATO assesses application. May request additional information (this pauses the clock).
Day 30-90: Decision
Receive approval or rejection. Standard is 30 days, but can take up to 90 days for complex cases.
Within 12 Months: Settlement
Must settle on property within 12 months of FIRB approval date.
⚠️ Plan for Delays
While the statutory timeframe is 30 days, in practice, FIRB approvals in 2026 are taking 30-90 days. Factor this into your settlement timeline and ensure your contract allows sufficient time.
Foreign Buyer Stamp Duty Surcharges
In addition to FIRB fees, most states charge foreign buyer stamp duty surcharges for temporary visa holders:
| State | Surcharge Rate | Cost on $700K Property | Notes |
|---|---|---|---|
| Victoria | 8% | $56,000 | Plus standard stamp duty |
| NSW | 8% | $56,000 | Plus standard stamp duty |
| Queensland | 8% | $56,000 | Plus standard stamp duty |
| WA | 7% | $49,000 | Plus standard stamp duty |
| SA | 7% | $49,000 | Plus standard stamp duty |
| ACT | None | $0 | No foreign buyer surcharge |
| Tasmania | 8% | $56,000 | Plus standard stamp duty |
| NT | None | $0 | No foreign buyer surcharge |
💰 Total Upfront Cost Example (Victoria)
Buying a $700,000 established dwelling in Melbourne:
- Deposit (10%): $70,000
- FIRB fee: $45,300
- Standard stamp duty: $38,000
- Foreign buyer surcharge (8%): $56,000
- Solicitor fees: $2,000
- Building inspection: $600
- Total upfront: $211,900
This is why many temporary visa holders choose new dwellings (lower FIRB fee) or wait for PR!
Frequently Asked Questions
Avoid the Stress of FIRB Non-Compliance
FIRB is a legal and financial commitment that shouldn't be handled alone. Rajesh Kandel and the team at Everest Home Loans work closely with specialized conveyancers to ensure your loan pre-approval and FIRB application are perfectly synchronized.
We can help you calculate the total cost of your purchase—including FIRB fees and foreign buyer stamp duty surcharges—using our specialized property calculators.
How Everest Home Loans Supports You
- ✅ Coordinate FIRB and loan approval timelines
- ✅ Calculate total costs (FIRB + stamp duty + deposit)
- ✅ Connect you with FIRB-specialist solicitors
- ✅ Service in Nepali, Hindi, Punjabi & English
- ✅ Ensure compliance with all FIRB conditions
- ✅ Help you avoid costly vacancy fee traps
📧 Email: raj@everesthomeloans.com.au
📍 Office: 35 Captain Pearson Drive, Mickleham VIC 3064
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03 9005 3955
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Kandel & Co Pty Ltd t/a Everest Home Loans is an Authorised Credit Representative – 506833, and Rajesh Kandel is an Authorised Credit Representative number – 476341 of Connective Credit Services Pty Ltd ABN 77 161 731 111 (Australian Credit Licence No.389328).
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