A small elite is making huge profits from the property market, while many ordinary Australians struggle with housing stress, according to new analysis commissioned from the parliamentary library by Greens senator Lee Rhiannon.
Many of Australia’s richest people now list property as their sole source of wealth, while state governments reap increasingly large windfalls from stamp duty without matching them with social housing investment.
“It’s going to become an issue that’s not just impacting on working class people, disadvantaged people, but increasingly hitting middle-class families, while the wealthy, the super wealthy, are doing very well,” Rhiannon told The Guardian.
The parliamentary library’s analysis examined a decade’s worth of BRW Rich List entries, noting that those who listed property as their sole source of wealth has nearly doubled. Of the 200 richest Aussies, those listing property as their only source of wealth increased from 28 in 2007 to 47 in 2017.
Using data from the Australian Bureau of Statistics (ABS), the analysis showed that profit margins for real estate services and property operators have hit levels not seen since before the GFC, reaching 57.6% in 2015-16, compared with only 35% in 2009-10.
Before-tax profits in this sector have surged every year since 2008-09, hitting $59.26bn in 2015-16.
The parliamentary library’s analysis also considered the revenues earned by the New South Wales government from the housing market. It found that revenue from land-transfer-related taxes, such as stamp duty, have increased by nearly $1bn every year since 2012-13.
The parliamentary library attempted to estimate the amount of capital investment in social housing over 10 years, but cautioned that obtaining complete and comparable data was a challenge. It said that the total capital investment in NSW social housing in 2015-16 was approximately $542m, although that included federal funds.
“Its capital expenditure has been generally increasing in recent years, with the notable exception of the 2009–10 and 2010–11 financial years,” the analysis said.
Collections: Mortgage News
Share