Offshore buyers of Australian property are dodging local real estate investment laws by using trust structures to their advantage, The Australian Financial Review reports.
"The much-preferred method that foreign buyers have pursued is to simply transfer funds to their newly appointed trustee who has Australian residency, and they then legally purchase a property," Mosman real estate agent, Robert Simeon told the AFR.
Offshore buyers are then able to transfer the deed to their name once they receive residency, with the title transfer cost just $50.
The controversial practice sees foreign investors sidestep Foreign Investment Review Board guidelines that prevent non-residents from purchasing existing homes. However, lawyers suggest such actions likely breach the Act.