Property Investment in Australia

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Investing in Australia- the facts!

At Profolio we spend a lot of our day researching property and investments. To do this we use Australia’s top property research house RP Data CoreLogic.
They collate the data for every property sold, rented, or built in Australia.
Recently CoreLogic released a report called ‘Profile of the Australian Residential Property Investor,’ June 2016. If you would like the full copy of this report please contact us, however I just wanted to outline some valuable facts for you the report shared.

– $6.5 trillion is the value of residential real estate in Australia
– This equates to 9.6 million dwellings
– Investors own 27% of Australian dwellings by number and 24% by value
– 15.7% of Australian tax payers in 2013/14 were property investors
– There is 2.6 million investor owned dwellings in Australia worth approximately $1.37 trillion
– As an asset class housing is 3 times the value of superannuation ($2 trillion)
– Australians hold more than half their wealth in real estate
– Australian banks have 60% of their balance sheet dedicated to housing
– Investors equate to 47% of new mortgages applied for
– Investors provide the vast majority of rental housing across Australia
– Investors claimed $3.719 billion in net rental losses in the 2013/14 financial year
– Investors paid Capital Gains Tax on $51.2 billion of profits made from property in the 2015 calendar year
– This contributed to the $45 billion in property related tax revenue collected by the state and local government
– Property is one of the most heavily taxed asset classes
– It is the middle income earners between $60,000-$80,000 who are most likely to claim a negative gearing loss
– Most investors only own 1 property
– 38.2% of investors in 2013/14 claimed a net profit
– The average loss at the same time was $8,722

These are incredible stats, and although the election dust has now settled and we are A political at Profolio, we do just want to highlight the stats around potentially changing negative gearing and some of the noise we’ve heard around property investors avoiding tax responsibility. These stats show the $3.719 billion of net rental losses offset by negative gearing are much less than the $51.2 billion in revenue gained by the government, which investors are a large contributor.

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