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A parliamentary committee has recommended that enforce stronger rules regarding foreign property investment.
The move comes amid a significant increase in foreign investment, particularly from Chinese investors, following recent amendments to trade agreements and Significant Investment Visas.
Treasurer Joe Hockey charged the House Economics Committee (HEC) with the task of investigating Australia's laws around residential real estate investment earlier in the year.
After six public hearings and 92 separate submissions, the HEC found more transparency was needed to explain why there have been no reports of buyers breaching rules since 2006.
The HEC's chairman, Liberal MP Kelly O'Dwyer, criticized the Foreign Investment Review Board (FIRB) for not applying the adequate rules that are already in place.
"There has been a significant failure of leadership at the FIRB, which was unable to provide basic compliance information to the HEC about its investigation and its enforcement activity," O'Dwyer told parliament on Thursday.
She went on to identify four major weaknesses in regards to the FIRB: its lack of timely data, its inadequate investigation and enforcement, its weak penalties and its lack of resources.
The HEC also made 12 recommendations that will limit resident non-citizens from purchasing recently built properties, enabling the Australian immigration department more influence in the buying process.
However, the HEC's Labor member, Ed Husic, said the majority of the report was an attempt to increase tax on foreign investment, driven by recent media condemnation.
"While some good might have the chance to emerge from the inquiry and some modest compliance measures might make the light of day, one hopes this report dissolves from memory and fast," he responded in parliament on Thursday.
An explosion of Asian investment is expected in Australia's property market over the next year, with a 20-30 percent increase in Chinese investment forecast over the next 12 months. Enditem
