I have just read an article which states that people moving into OZ can only purchase off plan or pieces of land which have to be built on within 12 months.
Is this correct as I have been looking at the realestate website and seen some great properties, but if you are not allowed to buy what u want it is no good.
Anyone know about this?

as far as i am aware this is only for non-residents (non permanent visa holders)
My brother and his wife live in dubai and last year bought in brisbane and they had to buy off plan, but we are able to buy anything (136 skilled subclass visa)

It really depends. If you buy property in a new estate you have covenents that say you must build a certain type of house within a certain length of time. Also, if you are on a PR you can buy/build whatever and wherever you like. TR is different. You need FIRB approval to buy any property.

If you are a temporary resident, you can buy property but you need FIRB approval. This is basically a formality as long as the residence is going to be your family home and you are not planning on renting it out. It takes about 3 weeks to get, though, so you will need to ask for 45 or 60 day settlement to ensure that it comes through before settlement. Also, if you are on a 457 visa, you will only be able to get 80% mortgage, and if you are on any other visa there is an insurance premium to pay for loans over 80%.

A permanent resident can buy what they like.

A temp resident requires requires Foreign Investment Review Board (FIRB) approval and there requirements are that you generally buy land etc.

As noted, a temp resident can not get a mortgage greater that 80% for mortgage insurance reasons.