Where the conditions are written
Approval arrives as a no objection notification, which Treasury describes as a letter from the Treasurer. It lets you take the action within a set period, usually 12 months, and it may include conditions. Treasury's guidance on residential land lists the common ones, but notes that every case is considered individually and the conditions actually imposed may differ.
Conditions are common. In Treasury's quarterly report for January to March 2026, 331 of 663 approved residential proposals carried conditions. In 2024-25 the figure was 2,692 of 3,922. The report's residential tables exclude variations and applications where the outcome was exempt.
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Common conditions by purchase type
| Purchase | Conditions Treasury says are usual |
|---|---|
| New or near-new dwelling | Price no greater than the value in the approval. No usual conditions on use: you may live in it or rent it out. |
| Vacant land | Price limit. At least one dwelling built. All dwellings completed within four years of the date of the notice of approval. Evidence of completion sent to the Government within 30 days of receiving it. No selling, transferring or disposing of the land before construction of all dwellings is complete. |
| Individual exemption certificate | One property only, in the state or territory named, at or below the stated price. Generally valid for 12 months. The standard conditions for that property type still apply. |
| Buyer under a developer's certificate | The certificate's conditions fall mainly on the developer: marketing in Australia, no more than 50 per cent of dwellings to foreign persons, no more than $3 million per buyer per development, and six-monthly reporting. Registration and the vacancy return still apply to you. |
Once vacant land has been built on, Treasury says there are generally no ongoing conditions on use. The owner may live in the home or rent it out. There is no limit on the number of new dwellings or vacant lots a foreign person can buy. Established dwellings bought under one of the narrow exceptions to the ban carry their own conditions, such as a minimum of 20 additional dwellings. See vacant land rules.
Obligations that apply even when the letter lists none
- Register. A foreign person who buys residential land must give a register notice within 30 days of acquiring it. In Treasury's example, a property that settled on 1 April needed a notice within 30 days of 1 April. See the Register of Foreign Ownership.
- Yearly vacancy return. A return is due every year, and a fee applies if the home was not lived in or available to rent for at least 183 days. See the vacancy fee page and how to lodge the return.
- Records. Treasury says foreign persons must keep records relating to certain foreign investment actions for up to five years.
Changing a condition
A foreign person can apply for a variation to a condition at any time. Treasury encourages applying as soon as you know you cannot comply, because delay may put you at risk of breaching. Points from the official guidance:
- A change to a condition is a standard variation, with a fee of $31,300, or the fee for the original application if that was lower. A minor fix such as a typo or wrong name is $4,600.
- An application to extend the period for taking the action must be made 2 months before it ends. If that date has passed, or the approval has expired, ask the ATO what applies.
- For a construction extension, the ATO's variation form asks for the current construction status, the project timeline and supporting documents such as building quotes or the development approval. The ATO says it considers variations case by case.
What happens if a condition is breached
The ATO says it uses data analytics and a land banking audit program to find breaches, and it says breaches can lead to directions to comply, infringement notices, penalties and disposal orders. It can also pursue court action.
On 29 September 2026 the ATO announced a $508,000 civil penalty ordered by the Federal Court against a foreign investor who did not complete a dwelling within the four years set by the approval. The ATO said the breach was found through data matching and its audit program, and that in 2024-25 it forced remediation of 217 foreign investment breaches, including disposal of 111 residential properties. The release notes that the matter is subject to appeal by the investor.
Treasury's compliance guidance (the March 2025 version) sets the maximum civil penalty for breaching most conditions at the greatest of double the capital gain, 50 per cent of the consideration, and 50 per cent of the market value. The penalties page covers other breaches. Treasury and the ATO both encourage anyone who thinks they have breached to contact the ATO as soon as possible, and say lower penalties may apply to a self-reported breach.
The four-year build period runs from the date of the notice of approval, not from settlement. A delay in settlement uses up part of it.
Keep reading
- What are the FIRB rules for buying vacant land and building a home?
- How and when do you lodge the annual vacancy fee return?
- What happens if a FIRB application is refused or withdrawn?
- What does FIRB approval mean, and what does it cover?
- How does a FIRB condition work in a contract of sale?
- Do you need a lawyer or agent to lodge a FIRB application?
Frequently asked questions
Can I rent out a property bought with FIRB approval?
Yes. Treasury's guidance says there are generally no conditions on use of a new dwelling, so you may live in it or rent it out. The annual vacancy fee can apply if the home is not lived in or available to rent for at least 183 days in a year.
Can I sell a FIRB-approved property?
For vacant land, not before construction of all the dwellings is complete. For a completed new dwelling, Treasury's guidance lists no resale restriction, though a register notice may be needed on a sale. Read your own approval letter, because the Treasurer can impose other conditions.
What if I cannot finish building within four years?
Apply for a variation early. Treasury encourages anyone who expects to miss a condition to apply as soon as they know, because delay may put them at risk of breaching. The ATO's form for a construction extension asks for the construction status, the project timeline and supporting documents, and each request is considered case by case.
What counts as evidence of completion?
Treasury lists a certificate of fitness for occupancy or use, a final occupancy certificate, or a builder's completion certificate as examples. It is due within 30 days of receiving it.
Will conditions on existing approvals change?
The Government's 2026-27 Budget measures include removing ineffective conditions on existing foreign investment approvals. The Treasury page that lists the measure gives no detail, so check your own approval and ask the ATO.
Sources
- Guidance Note 6: Residential land (Treasury, v5)
- Guidance Note 2: Key concepts (Treasury, v5)
- Guidance Note 10: Fees (Treasury, v12)
- Guidance Note 14: Compliance and penalties, residential land (Treasury, v4, March 2025)
- Guidance Note 15: Register of Foreign Ownership of Australian Assets (Treasury, v7)
- Quarterly report on foreign investment, 1 January to 31 March 2026, Treasury
- How to apply or vary an approval to buy residential property, Australian Taxation Office
- Foreign investment in residential assets: our compliance approach, Australian Taxation Office
- ATO secures second civil penalty against residential land bankers, Australian Taxation Office, 29 September 2026
- Further streamlining and strengthening the foreign investment framework, Treasury, 19 May 2026
Checked 5 October 2026.
firbapproval.com.au is an independent guide. It is not affiliated with, endorsed by or connected to the Foreign Investment Review Board, the Australian Treasury or the Australian Taxation Office. We do not lodge or process applications. Applications are made to the ATO. General information only, not legal, tax, migration or financial advice.