Victoria’s landlord exodus has extended offshore, with Australian Taxation Office data showing even foreign investors are walking away from the state.
In the latest Register of Foreign Ownership of Australian Assets, up to July 1, 2025, there were 16,403 residential properties owned by international investors across the state.
A year prior the number was 16,929, reflecting a more than 500 home loss to the state’s foreign-owned properties list — and a likely hit to its rental supply.
The report also shows a 1272 drop in the number of homes owned by China-based investors around Australia in the same timeline.
Daniel Andrews’ plan to recover Covid era debts via a landlord tax hit has coincided with an international landlord exodus.
While it doesn’t indicate which states they were selling out of, separate Foreign Investment Review Board data has consistently shown Victoria and NSW as the nation’s leading destinations for Chinese investment in housing.
The FIRB statistics have also shown a significant decline in Chinese spending in recent years compared to a decade ago, correlating with the Victorian government’s expansion to stamp duty costs for foreign investors.
The reduction in internationally-owned properties coincides with the implementation of increased land tax for homes not owned as a primary residence, which came into effect in Victoria on January 1, 2024, with landlords receiving the increased bill in the months that followed.
However the policy was announced in the May budget of 2023, when Daniel Andews was still Victorian Premier.
ATO data shows where most of Australia’s foreign-owned homes are, with Victoria the biggest by far — though it is now in decline.
The most recent data from Victoria’s Department of Families, Fairness and Housing has shown a consistent reduction in active residential tenancy bonds in the same timeline, suggesting landlords have been selling up faster than they were buying in.
The ATO data shows it’s not just local landlords who are selling up, and market experts have warned it is the latest sign the Allan government has gotten its property investor settings wrong to the detriment of renters and the state’s economy.
Real Estate Institute of Victoria chief executive Toby Balazs said the data appeared to show that, similarly to local investors, foreign investors were questioning Victoria as an investment destination.
“And they are looking to be, unfortunately, exiting the market,” Mr Balazs said.
Melbourne has been a focal point for foreign investment into Australian housing for more than a decade, according to FIRB reports.
“This is another example of property investors leaving the state and in doing so putting greater pressure on the rental vacancy rate.”
He noted that with NSW having recently relaxed taxes on foreign investors to encourage more rental and retirement village homes, the Victorian government should be looking to other states to consider ways to increase investor interest in both purchasing and retaining homes across the state.
“That will assist with much needed rental stock being brought into the Victorian market place,” Mr Balazs said.
Property Investor Council of Australia chair Ben Kingsley said the Victorian government had made the state the worse place to invest in property in Australia with a littany of rental reforms as well as increased taxes for investors.
“This is not surprising when you have the economic settings and the tax settings we have in this state,” Mr Kingsley said.
“They are all wrong. They do not encourage investment into Victoria and the Victorian property sector.
“This state government couldn’t have done a worse job in terms of disincentivising investment into residential property in this state.”
He added that while Victoria’s past slogan had been “the place to be”, for investors it was clearly “no longer the place to be”.
Ray White chief economist Nerida Conisbee said it was also likely China’s appetite had changed for investment properties after high-profile developer collapses in the Asian nation, which could also have led to investors based there deciding to sell Australian homes.
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