Real Estate Overtakes Mining
The real estate industry has officially overtaken mining as Australia’s most profitable industry. In the last quarter, real estate produced $8.6 billion of taxable profit compared to just $3.6 billion by the mining industry.
The Australian economy has relied heavily on the stability of the mining industry and its ability to consistently provide large profits.
This trailing off of profits in the mining industry is believed to be the result of an unprecedented mining boom winding down.
The latest figures from the Australian Bureau of Statistics show rental, hiring and real estate service companies made $14 billion before tax in the second half of 2015 while mining companies made only $9.8 billion.
Real estate profits were twice those of the retail and construction industries and far in excess of those of the finance and insurance industries, which recorded a combined loss.
Mining profits had previously been five times those of real estate, only two years earlier.
The turnaround means the fortunes of the real estate industry are now more important to the budget than those of the mining industry.
The new position of the real estate industry at the forefront of Australia’s economy, combined with positive housing figures, depicts an overwhelming positive story for home construction and housing product manufacturers.
These results may have an impact on the political decision regarding negative gearing.
The figures prove the economical, financial and social importance of real estate; emphasising the fact the Australian housing industry is as lucrative as it is cherished.