Join Australia's most dynamic and respected property investment community

Libs Rule Out Neg Gearing Changes

Discussion in 'General Property Chat' started by sash, 24th Apr, 2016.

  1. sash

    sash Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    3,214
    Location:
    Sydney
    It looks like the Libs have ruled out any changes to Negative Gearing

    ‘We’re not going to put a tax on housing’

    This is good news to investors..but I also believe that it will also exercarbate the eventual correction. As stated previously....Sydney will feel this the most.
     
    Leo2413 and markson like this.
  2. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,293
    Location:
    Sydney
    Are you saying Sydney will boom again?
     
    WattleIdo and ashish1137 like this.
  3. jins13

    jins13 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    932
    Location:
    Sydney
    Knew there was no way they would abolish this
     
  4. sash

    sash Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    3,214
    Location:
    Sydney
    Its like asking are development in Logan financially viable...if you can answer that you will have your answer. ;)
     
    barnes likes this.
  5. HUGH72

    HUGH72 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,117
    Location:
    FNQ
    Sash, you and @RetireRich101 need to have your own meet up in Sydney. Despite antagonising each other the irony is you both would have a lot in common.:D
     
    samiam, RetireRich101 and Northy85 like this.
  6. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,293
    Location:
    Sydney
    we can never stay on topic, can we?
     
  7. LibGS

    LibGS Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    615
    Location:
    Melbourne, Australia
    The LNP were never really interested in changing NG, let's not kid ourselves. It was basically a ploy to get Labor to come up with something and then point the finger and say crap about them. Recall, at the start of all this, the cry was "everything is on the table", until of course it wasn't.
     
    marty998, Observer, gman65 and 3 others like this.
  8. SirDingo

    SirDingo Well-Known Member

    Joined:
    12th Mar, 2016
    Posts:
    87
    Location:
    SA
    Well, good news for investors who do not make a positive cash flow. And probably good news for tenants too. If NG were abolished, there's a fair likelihood that some investors would raise rents to cover the subsequent financial loss, driving rental prices higher across the market.

    Personally, I don't have any NG properties, so if it were abolished there is a decent chance that rents would rise and we'd see a bit of a spike in rental income.

    On the other hand, some NG investors may feel the pinch if they can't deduct losses and find themselves forced to sell, which could theoretically see some motivated sellers enter the market.
     
  9. Bullion Baron

    Bullion Baron Well-Known Member

    Joined:
    25th Jul, 2015
    Posts:
    589
    Location:
    Adelaide, Australia
    I think Liberal have misread the social mood on this issue. Labor's polling has improved since they released their policy on negative gearing and changes to the CGT discount.

    Housing affordability was a big voter issue in 2013, but neither party addressed it. Affordability has worsened since and one party has made it clear they will tackle it. This could very well have been an election winning move (though Liberal still have the slight upperhand at this point).

    That's not how the rental market works (investors being able to jack up rents in line with costs), it is beholden to supply and demand factors like any other which control what landlords can charge.
     
    DaveyB, wylie, wategos and 1 other person like this.
  10. Ed Barton

    Ed Barton Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,114
    Location:
    Brisbane
    If the market can bear it why haven't these investors already raised rents?

    NO one is proposing NG be disallowed on existing property. All talk is of grandfathering NG so that existing LLs can continue to NG on properties currently owned. It would not be allowed on new purchases.

    Without doubt there would be upward pressure on rents and downward pressure on property prices. With grandfathering it would be gradual shift.

    There will be no pinching and no forced selling.
     
    See Change and Bullion Baron like this.
  11. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,544
    Location:
    Sydney or NSW or Australia
    Not so much a case of Labor having improved their vote but Turnbull having lost his popularity.


    Housing is not a free market - subject to a host of rules affecting supply, taxes, occupancy and not a single driving issue or commonality ie your ip investing neighbour doesn’t know/care if you have 27 backpackers in your 2 bedroom house provided it doesn't affect their tenants next door.
     
    SirDingo likes this.
  12. Bullion Baron

    Bullion Baron Well-Known Member

    Joined:
    25th Jul, 2015
    Posts:
    589
    Location:
    Adelaide, Australia
    No doubt other factors at play, one policy alone is not a poll decider, but I doubt it's a coincidence that there was a significant shift in sentiment trends around the time Labor came out with clear policy on housing affordability and Liberal was left floundering, resorting to scare tactics.

    None of this supports the sentiment that landlords will be able to just jack up rents when their costs increase.

    Labor's policy doesn't touch those already negatively gearing property... have you read their policy proposal? Try here: Positive plan to help housing affordability
     
  13. propernewb

    propernewb Well-Known Member

    Joined:
    6th Sep, 2015
    Posts:
    137
    Location:
    NSW
    I'm curious to know why you think it would exacerbate the correction? I would think, if anything, it would make the correction less severe as the government would still be subsidising loss-making investments and reducing the impetus to sell.
     
  14. LibGS

    LibGS Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    615
    Location:
    Melbourne, Australia
    Scott No Mates likes this.
  15. sash

    sash Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    3,214
    Location:
    Sydney
    Maybe but people are irrational there will be a knee jerk reaction.

    The good news is rents should jump quite a bit...
     
  16. MarkB

    MarkB Some guy on the internet Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    181
    Location:
    The screen you are reading.
    This is a bizarre way to position a policy.
     

    Attached Files:

  17. Barny

    Barny Well-Known Member

    Joined:
    16th Oct, 2015
    Posts:
    1,178
    Location:
    Melbourne
    Totally agree, weird. It's also floating on Facebook with a video showing a couple using negative gearing to get ahead.
     
  18. propernewb

    propernewb Well-Known Member

    Joined:
    6th Sep, 2015
    Posts:
    137
    Location:
    NSW
    Indeed, considering that ~1 million people are negative gearing it's a hard sell to convince those who aren't negative gearing that the nation should somehow subsidise the investments of a select few
     
    Barny likes this.
  19. propernewb

    propernewb Well-Known Member

    Joined:
    6th Sep, 2015
    Posts:
    137
    Location:
    NSW
    Hmmm, sorry I don't understand. If there is no change in policy, then there shouldn't really be any change in market trend. Ergo: if negative gearing remains, rents will continue in the direction that they have been going i.e. flat or rising with inflation
     
  20. Ed Barton

    Ed Barton Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    1,114
    Location:
    Brisbane
    By 1990 no Australian child will be living without an investment property.
     
    inertia and LibGS like this.