There is a lot of noise being bantered about regarding property investment of late.
No surprises here given the pending federal election; the likelihood of a close result and the mooted investment property changes by the Labor Party.
I don’t want to join the noise, but when I read or hear gibberish I always like to go back to the numbers.
So just how many Australian households hold an investment property? And who are these cats?
A quick summary
- There are about 9 million dwellings in Australia
- Of which some 1.8 million are held by investors
- So, 20% of Australian households hold an investment property and 80% don’t
The top investor age groups are:
- 25% are aged between 55 and 64 years
- 24% are aged between 45 and 54 years
- 22% are aged between 35 and 44 years
- And just 15% are aged under 34 years
When it comes to the investment property’s value (in today’s dollars), investor’s think that:
- 35% are worth between $250,000 and $500,000
- 18% are worth less than $250,000
- 18% are worth between $500,000 and $750,000
- And 6% think their investment property is worth over $2 million. Hmmm, tell them there dreaming!
And finally, how many investment properties do investor households hold?
- 73% hold one investment property
- 17% hold two investment properties
- 6% hold three investment properties
- And just 4% hold four or more investment properties
To add the numbers to this spread:
- 1,309,000 investor households hold one investment property
- 302,000 hold two investment properties
- 104,000 hold three investment properties
- And just 85,000 investors hold four or more investment properties
Forgive me if I don’t want to get caught up in the current balderdash about the possible changes to negative gearing and how it is going to decimate the housing market.
There are more important factors affecting the future direction of the Australian housing market and especially when it comes to new housing development.
The best way to understand what is going on is to go back to the actual numbers. Ignore the hyperbole.
Until next time,