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Real estate lobby urges Government to retain negative gearing

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Your Investment Property | 12 Feb 2015, 01:19 PM Agree 0
A real estate association has urged the Government to retain negative gearing to encourage property investment and place downward pressure on rents.
  • Infowars | 13 Feb 2015, 08:47 AM Agree 0
    My god, imagine investors lowering rents..... Geez..... That's going to happen! Lol!!! Get real, such hypocrites, let us have incentives, while at the same time saying that under supply will be made to oversupply and drive down values and rents for investors....haha, shooting yourselves in the foot, so I. Reality it's a lie. Investors are screwing up the market as well as govt foreign investment rules.

    Don't forget, your children will be living with this mess your making.
  • Gregory | 13 Feb 2015, 10:08 AM Agree 0
    As a landlord and ex-tenant, I see both sides of the fence and things could be fairer.
    Limiting negative gearing to new House/Unit purchases "going forward of course", would be a great benefit to increasing housing stocks and therefore keeping rents reasonable.
    Fact is investors buying established properties drive up rents and property prices.
    If we do what I suggest an investor selling their new property would more likely sell it to a owner occupier because the sale would extinguish the negative gearing. This would take most investors out of the mix for buying established and make prices more reasonable to the next owner.
    Importantly if the landlord dies, there should be prevision that negative gearing for that property passes onto the beneficiary/s of the Will. The property might get sold anyway, but we want to do something that minimises tenants getting tossed out into the street just because the landlord dies.

    So this would encourage investors to keep new property long term and encourage growth in new housing stocks.

    Those two things alone has to be a good thing for Australian home ownership and rents?
  • Peter | 13 Feb 2015, 04:49 PM Agree 0

    I am an investor whose sole income is from property.

    I have always been opposed to negative gearing because it make homes more expensive for home buyers (including first, second, third and more home buyers).

    It is simply unfair for higher income earners (who are more highly taxed because they have higher incomes) to be given the privilege of writing off some or all of their tax when they buy a property at the expense of home-buyers who are subsequently prevented from buying properties that negatively geared higher income earners can pay more for due to using their privilege of negative gearing.

    Not only are property prices made higher by giving higher income earners the privilege of negative gearing (and the higher the income the higher the privilege) but the Federal Government loses about $4 billion each year in taxes that negatively geared property owners do not have to pay. The suffering first home buyer and other people who are not negatively geared then have to pay an extra $4 BILLION IN TAX because of the privilege given to negatively geared high income earners.
    • nature not nurture | 16 Feb 2015, 10:42 PM Agree 0
      sorry dont agree at all....ANYONE can negative gear if they buy an investment property - even first home buyers!....those earning higher incomes earn them because they are intelligent they dont need to justify themselves to you or be penalised for being the smartest in the room!
  • Jeremy Sheppard | 14 Feb 2015, 09:25 AM Agree 0
    High prices have nothing to do with negative gearing. Prices are high in Australia because it is a great place to live, literally at the top of the world's best. It's supply and demand.

    If neg gearing was abolished, investors would leave the market and prices would tumble. Some renters would snap those cheap properties up. Developers would lose buyers and profit margins and therefore pack up shop. Supply stalls and soon prices start spiraling upwards again. Investors re-enter the market.

    Every time you change the rules, there'll be instant winners and losers. But eventually supply and demand has its way and we get back to the same story. If you want to bring prices down, start a civil war. Stop complaining about high prices and enjoy the lucky country - as it is. Don't muck with it.
  • Scott V | 15 Feb 2015, 01:50 PM Agree 0
    Tax badly and ineffectively used is the problem, if the government treated tax dollars as their own and did more investment into the country we wouldn't have an affordability problem, because people would have enough jobs to pay for the prices as they are now. Increasing taxes makes us uncompetitive against other south east asian countries and costs us jobs. For example our industrial capacity in the automotive industry has been culled by over taxing and overseas subsidies, tarriffs etc.
    We did a good job with the China free trade agreement and we need more of these types of initiatives to solve bigger problems with our economy that cause rich/poor divisions to the extent that the poorer people can't afford basics like a roof over their head and food on the table. There is a place for tax incentives, we need a better tax scaling to create more sustainable businesses, if we had taxes like Singapore or Hong Kong we would attract more foreign investment, create more successful businesses that could grow due to people being able to afford to grow a business here and we would lose less of our talent overseas with brain drain.
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