Investment Properties

With interest rates going up this week, media attention turned to the May Federal Budget and whether the Labor Government will potentially look at changing property taxes. On the agenda is making changes to the 50% capital gains tax discount on investments and potentially reviewing negative gearing again. “At present, the 50 per cent discount means that if a person sells an investment property or parcel of shares (for example) for a $200,000 profit, they will pay tax on only $100,000 of that profit. Reducing that discount to 33 per cent would raise an extra $4 billion per year by 2035-36, according to Deloitte Access Economics, SMH. So potentially how many people will this effect? The population of Australia is around 27,300,000 people. Recent data shows roughly 2.2 million investors among Australia's taxpayers, the majority of whom own just a single rental property. 

Key Figures & Insights:

Overall Ownership: Approximately 20-22% of Australian households own an investment property.

Number of Investors: About 2.2 to 2.3 million individual taxpayers own investment properties.

The vast majority around 70-71% of these investors own only one investment property and approximately 18% own 2 properties.

Data Source:  Australian Taxation Office (ATO) and the Australian Bureau of Statistics (ABS).