Data analysis needed on foreign investment

Data analysis needed on foreign investmentA small part of the expected $200 million raised by new foreign investment rules should be invested in data analysis in Australia’s housing market, says the Residential Development Council.The Foreign Acquisitions and Takeovers Legislation Amendment Bill, introduced into Parliament last week, includes tougher penalties for individuals and companies, as well as for real estate and migration agents, conveyancers and lawyers who knowingly assist a foreign investor to breach the rules.The measures, first announced by the Federal Government earlier this year, are designed to increase compliance with Australia’s foreign investment rules – a move welcomed by industry. The Property Council has acknowledged the Government’s consultative approach in putting together the bill and the associated regulations that are yet to be released.However the Property Council has criticised the Government for striking the new fee regime so that it will raise three times as much as the cost of administering enhanced compliance measures.A small portion of this money would be well spent in analysis of housing data, says Nick Proud, executive director of the Residential Development Council.”Our industry is a vital contributor to the economy, jobs and housing for Australians. Despite this, we have no centralised data repository which analyses the many different housing data sets.”Before it closed in 2013, the National Housing Supply Council cost around $2.3 million per year to provide valuable baseline metrics which governments, industry, home buyers, and the whole development assessment system could rely upon.”Now that the Australian Tax Office will play a greater role in collecting foreign investment data, we have an opportunity to bring this together with the wealth of unconnected data currently available,” Proud says.Housing data is currently gathered by the Australian Bureau of Statistics, the Reserve Bank of Australia, the Australian Prudential Regulation Authority, the Australian Securities and Investments Commission, the Australian Housing and Urban Research Institute, Core Logic and the Property Council of Australia, among others.”In many cases there is transactional data just sitting there which, with a small amount of work, becomes valuable market information.”We should be feeding all this data into a central repository to produce accurate macro forecasting,” Proud says.A central data repository would fit strategically with the introduction of the Foreign Residential Land Register, set to commence collection of residential sales data from July 2016, Proud adds.”National housing finance, commencements and completions have never been higher. It makes complete sense to allocate a small amount of this new foreign investment income stream to better understand the data and develop policies which maximise future residential activity.”