Australia's property strength revealed.
By Paul Bennon, Managing Director, DEPPRO
The latest ABS Property Price Index released this week had very positive news for the property sector with the Index showing that collectively the value of dwellings in Australia has surged to $6.9 trillion.
This is an increase of nearly $1 trillion in the collective value of residential dwellings in Australia since 2016 when the figure stood at $6.0 trillion
New South Wales, Victoria and Queensland accounted for the lion's share of national residential wealth.
The collective value of dwellings in New South Wales has now reached $2.7 trillion, in Victoria, $1.9 trillion and in Queensland, $1 trillion.
Source(s): Residential Property Price Indexes and Residential Property Prices, Weighted average of eight capital cities, Quarterly percentage change-RPPI Percentage Quarterly Change 8 caps - Timeseries.xls
While the overall value of capital city dwellings has undergone a correction during 2018, the ABS figures show that over the long-term investing in Australian property is a secure long-term investment.
The figures show, for example, the median house price in Sydney has nearly doubled over the last nine years to $945,000. Even in smaller State capitals such as Hobart, the median house price has jumped nearly 50% to $450,000.
Overall, the ABS data showed that the median price of a dwelling in Australia is now $686,200.
It also revealed the number of dwellings in Australia has now breached the 10 million bench-mark with 10,093,700 in the June quarter 2018.
Both the total number and value of dwellings in Australia highlighted by these ABS figures underscores the importance of the property sector as a driver of personal wealth for ordinary Australians.
Property investors traditionally have accounted for a significant proportion of real estate buyers in Australia.
This is particularly the case amongst people aged over 40 who are investing to property to fund their retirement.
DEPPRO is finding that these mature property investors now account for more than half of all people who use our tax depreciation services.
These mature investors understand that property delivers significant tax benefits especially in relation to deprecation that can total up to 60% of the total purchase price of a property.
For example, a new apartment costing $600,00, these generous tax depreciation benefits can amount to $360,000.