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Despite largely operating as individuals rather than a collective industry, property investors and their purchasing activities have far-reaching implications for the wider Australian community and economy – providing housing, stimulating building activity, driving gentrification and boosting consumer confidence.
This section of the Australian population is keen to generate wealth through tangible assets, rather than rely on the government and fellow taxpayers for their future financial security and safety.
Figures from the Australian Taxation Office (ATO) show that around 1.9 million Australians (or eight per cent of the total population) declare a rental income. Yet whether you go to backyard barbecues, pick up the weekend paper, listen in on Question Time while politicians debate the financial future of the country, or ask a friend for advice about wealth accumulation – property investment will be bandied around as a conversational football.
This increased focus on property investment as a hobby, wealth-creation tool and professional industry is no doubt driven by the fact that it’s now a multibillion-dollar sector of the economy.
The Australian Prudential Regulation Authority (APRA) put the total value of residential property loans at $1.3 trillion in March 2015. Investment property loans accounted for 34.5 per cent (or $450.2 billion) of this figure. Property investment lending is also growing at a faster rate than that of owner-occupiers. Investor activity grew by 12.4 per cent in the year to March 2015, compared to owner-occupiers, which climbed 7.2 per cent over the same period.
Property investors are always seeking out more information and tools to help them make the right decisions regardless of market conditions. They’re aspirational individuals looking for their next purchase, with ATO figures revealing 72.8 per cent of investors own one investment property, 18.9 per cent have two – and just 0.9 per cent own a portfolio consisting of six or more properties.