A new survey has found 45% of property investors had sold at least one property in Queensland over the past two years.
The Property Investment Professionals of Australia (PIPA) survey also found that 19% of investors nationwide had signalled they intend to sell even more property over the year ahead, putting Queensland’s new land tax law changes as the top reason for selling.
Queensland’s new land tax changes will mean the state government will use the total value of the land owned across the country to calculate land tax from July next year.
PIPA Chair Nicola McDougall said it was clear that investors had had enough of being the cash cow for all levels of government.
“From Coolangatta to Cairns, investors have deserted the Queensland market over the past two years, with more rental pain on the horizon as well,” McDougall said.
“We had an inkling that investors had been selling their holdings over the past year or two, but these results show that even we had under-estimated the volume of rental properties that have been jettisoned from the market.
The survey, which polled 1618 property investors, showed 24% of investors sold a property or properties in New South Wales over the past two years, and 19% in Victoria.
PIPA analysis showed that 29% of rental dwellings had changed hands in the Queensland market over the past two years, amounting to more than 160,000 properties.
McDougall said investment activity had been below historical averages over the past two years, with further analysis showing that it was generally owner-occupiers, including first-time buyers, who had purchased the former investment stock.
“The number one reason why investors sold was due to the positive selling conditions at the time, followed by to reduce their total borrowings, and changing tenancy legislation making it too costly or hard to manage,” she said.
“These investor insights help to explain why so many investors – myself included – sold in Queensland because property prices were mostly stagnant there for years before the pandemic because of its underwhelming economy.
“So, after the moratoriums on rental evictions ended, and prices started to rise, investors offloaded their properties in the hundreds of thousands.
“That said, even with the strong market conditions last year, after all the costs including Capital Gains Tax that I paid over the 15 years I owned a property in a Brisbane middle-ring suburb, I would have been better off financially driving an Uber in my spare time.”