As overseas real estate transforms from a niche choice to an asset allocation option, the entry barriers for foreign homebuyers in various countries are quietly reshaping the investment landscape. From Southeast Asian tourist hotspots to traditional immigration destinations in Europe and America, the subtle shifts in policy tightness reflect both local residents’ demands for housing fairness and governments’ strategic considerations regarding economic structure. This global policy game is drawing new boundaries of opportunity and risk for cross-border investors.
Saudi Arabia: The “Golden Visa” Dividend Under Economic Transformation
As the forefront of opening up in the Middle East, Saudi Arabia is attracting global capital through mega-projects such as the “New Future City.” Its foreign homebuying policy presents a “dual-track” system: in core cities like Riyadh and Jeddah, buyers must meet the “Golden Visa” requirements—investing at least 400,000 Saudi riyals (approximately US$107,000) in real estate to obtain long-term residency; while in remote areas, the threshold is significantly lower, with some projects even allowing foreign investors to directly purchase land. This strategy of “tightening restrictions in core areas and opening them up in peripheral areas” both guarantees the housing needs of local residents and provides financial support for economic diversification. For example, vacation apartment projects in the Red Sea tourist area successfully attracted European investors and boosted local employment by 15% by allowing foreigners to purchase timeshare ownership of hotel units.
United States: A Federal and Local Policy Puzzle
US housing policies exhibit significant characteristics of “local autonomy.” While there are no uniform restrictions at the federal level, popular states like Texas and California have established implicit barriers through legislation: Texas requires foreign buyers to provide proof of tax residency and limits loan-to-value ratios to no more than 60%; California, through the Foreign Investor Tax Act (FIRPTA), mandates a 15% withholding tax on capital gains when non-residents sell property. This “easy entry, strict exit” model maintains market attractiveness while preventing short-term speculation. The Manhattan apartment market in New York is a prime example—although the law allows foreigners to freely purchase, high property taxes (approximately 1.5%-3% of the property price) and holding costs (property management fees, insurance premiums, etc.) automatically filter out long-term investors. Data shows that foreign buyers in New York have an average purchase cycle of 8 years, far exceeding the 3 years for local residents.
Australia: A Shift from “Welcome Investment” to “Housing Fairness”
Australia was once a safe haven for Asian investors, but its policies have tightened dramatically in recent years. In 2021, New South Wales became the first state to ban foreigners from buying existing homes, allowing only investment in newly built residences. Victoria raised the stamp duty for foreign buyers from 7% to 12.5% and required developers to reserve at least 15% of units for local residents. Behind these protectionist policies was the rapid rise in house prices in cities like Sydney and Melbourne—over the past decade, house prices in these two cities have increased by 110% and 95% respectively, significantly increasing the financial burden on local residents. After the policy adjustments, the proportion of foreign investors plummeted from 15% in 2016 to 5% in 2023, but new changes have emerged in the market: Chinese investors are turning to second-tier cities like Brisbane, purchasing land to build their own villas, circumventing the restrictions on existing homes while enjoying lower land taxes (approximately 0.5% of the house price).
Thailand: A Tourist Hotspot’s “Limited Opening” Strategy
Thailand employs a “tiered management” approach to foreign property purchases: For apartment projects, foreigners are allowed to purchase 49% of the units, held through a Thai company; for detached houses like villas, direct purchase by foreigners is prohibited, requiring indirect ownership through land leasing (usually renewable for 30 years) or joint ventures with Thai nationals. This “semi-open” policy attracts a large number of retirees (60% of foreign buyers in Chiang Mai and Phuket are over 50) while preventing excessive concentration of land resources. For example, a high-end villa project in Phuket, through a “land leasing + brand management” model, allows foreign investors to enjoy an average annual rental return of 8% while paying land rent (approximately 2% of the property price per year), making it a “safe haven” in the Southeast Asian market.
Global policies on foreign property purchases are evolving from “single openness” to “precise regulation.” Saudi Arabia’s economic transformation needs, the United States’ tradition of local autonomy, Australia’s demands for housing fairness, and Thailand’s reliance on tourism constitute the underlying logic behind these policy differences. For investors, understanding the economic objectives behind policies is more important than simply comparing restrictive clauses—finding the benefits of special economic zones in Saudi Arabia, focusing on long-term holding costs in the US, investing in second-tier cities in Australia, and choosing compliant indirect holding models in Thailand are all ways to seize real opportunities amidst policy fluctuations. This global policy game will ultimately drive cross-border real estate investment towards a more rational and sustainable future.
