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Don't cut negative gearing, urges expert

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Australian Broker | 16 Aug 2012, 07:30 AM Agree 0
A property investment expert is urging the government not to touch negative gearing, after a welfare group asked for cuts
  • BONED | 16 Aug 2012, 09:57 AM Agree 0
    Another case of tall poppy syndrome when it comes to ACOSS. This country seems to be thriving on that methodology in this period of time!
  • GB | 16 Aug 2012, 09:58 AM Agree 0
    neg gearing for new home builds only. these are the real "property investors" as they actually create something. Investors buying existing properties, pricing out owner occupiers then jacking up rents create nothing. Giving tax breaks to "investors" so they can out bid would be owner occupiers on existing homes should and will go. the sooner the better.
  • Warwick | 16 Aug 2012, 10:30 AM Agree 0
    Alternatively, taking away negative gearing for investors and making owner occupied interest tax deductible would create a more even spread of "wealth". This would also be an incentive to get new home owners into the market
  • Patrick | 16 Aug 2012, 10:47 AM Agree 0
    Negative gearing is not a tax lurk it is a housing policy. Without the tax incentives ordinary Aussies would invest in something else (shares, super) not residential property. Who would have built and owned all the rental property currently occupied by the hoi polloi about whom ACOSS is so concerned? They already have one of the cheapest rental regimes in the world measured by yield to investors. What we really need is some cheaper housing. Many Americans live in mobile homes. Contrary to common belief these are not caravans. They are solid 3 or 4 bedroom relocateable homes which are purchased typically well under $100,000 and parked on a 4,000 sq ft lot (400 sq meters) for which rent is paid. Most never get moved once parked. very few local councils in Australia have any zoning to allow such mobile home parks and the potential for such a policy to soak up a massive amount of housing demand frightens the pants off our Big 4 bankers. It is this availability of cheap housing for ordinary folk that makes US house prices volatile just like any other asset.
  • Patrick | 16 Aug 2012, 11:12 AM Agree 0
    Err, GB, new home buyers already get extra tax breaks, 2.5% depreciation on the structure and 7 to 15% depreciation on plant, fixtures and fittings. The interest tax deductions are only negative gearing for 5 to 10 years by which time rent rises and repayments make a rental property positively geared. Keating tried to limit negative gearing tax benefits and the outcome quite predictably was significant rent rises. Then ACOSS will be crying for rent subsidies. The poorest of Australians are still probably in the top 5% or at least 10% in global terms. Be thankful.
  • Allan | 16 Aug 2012, 11:58 AM Agree 0
    Seems GB needs to do a little more research. Its uneducated comments like this that give brokers a bad name...give your accountant a call and ask a few questions about this topic.
  • Mikeh | 16 Aug 2012, 12:30 PM Agree 0
    Why don't organisations like ACOSS properly research their suggestions? A few decades ago the World's Greatest Treasurer (Paul Keating, for those who don't know or have forgotten) brought this for exactly the same reasons as those being pushed by ACOSS. The result? No more negative gearing, investors pulled out of the property market. Rental property availability fell and rents skyrocketed. Another Labor stuff-up that was rectified as soon as the effects became apparent. NOTHING HAS CHANGED, PEOPLE!
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