Multi-property investors worry RBA
The number of property investors with five or more properties in Australia has spiked in recent years, adding to central bank concerns about the overheated Australian housing market.
The Reserve Bank of Australia says that in the 2014/15 financial year the number of investors with five or more properties grew by 7.5 per cent - almost double the rate of growth over the previous nine years.
Of the 11 per cent of the adult population - around two million people - with investment properties in Australia, more than half of those are now owners of two or more properties, according to data included the the RBA's Financial Stability Review, released on Friday.
One in ten investors now own three or more properties, the central bank said, based on analysis of Australian Taxation Office data.
High income earners make up the biggest group of property investors - with 30 per cent of those earning between $100,000 and $500,000 a year having investment properties.
About 11 per cent of those earning less than $50,000 had properties, however the ATO figures used do not account for non-taxable income such as superannuation drawdowns.
Professionals such as teachers, lawyers and accountants are the biggest group of investors by professional grouping - accounting for 22 per cent of property investors in 2014/15.
Managers and professionals together - the two highest-paid groups - account for 37 per cent of all investors in property and have close to the highest level of negative gearing.
The most highly negatively geared group of workers, however, is machinery drivers and operators: they account for just three per cent of property investors but 74 per cent of them are negatively geared.
In January, as debate raged in federal parliament about Labor's policy of winding back negative gearing concessions, Prime Minister Malcolm Turnbull defended the measure, saying there were "vastly more teachers and police" using it than "high-flying lawyers and accountants".
The RBA has also flagged a "marked increase" in the age of property investors, with the number of over-60s in the market almost doubling in the 10 years since 2005 to account for about 22 per cent of all investors.
Investors in the 50 to 59 age group are the biggest cohort, followed by 40 to 49-year-olds and then the 60-plus group.
Under-39s account for about 20 per cent and under-30s about six per cent.
The central bank says the spike in multiple-property investors represents a major shift in the nature of household property investment and is among several growing areas of potential risk in the property market.
The bank also flagged "unsighted" property purchases as a concern.
Queensland has about 25 per cent of Australia's rental properties but less than 20 per cent of investors are from Queensland - suggesting a "sizeable share" of investment properties are owned by multi-property investors or out-of-town, unsighted investors who speculate and increase the chances of a sell-off in a downturn.
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