Potential AXE to negative gearing?!

Discussion in 'Property Market Economics' started by Property Twins, 2nd Oct, 2015.

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  1. wategos

    wategos Well-Known Member

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    Rents were rising due to other factors, nothing to do with the removal of negative gearing. Rents continued to rise in those cities for years after NG was reinstated. It was only reinstated to win an election, Labor was scared of losing the election and promised to reintroduce it at the last minute to try to sway some negativity geared Liberal voters who had been targeted in a scare campaign.
     
  2. Ed Barton

    Ed Barton Well-Known Member

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    and I took a dump more often, doesn't mean my ***** were a result of it's removal. If the removal caused rents to rise they would have risen across the country.
     
  3. THX

    THX Well-Known Member

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    Since you seem unaware the property market is not identical in every state or city so expecting an identical reaction in each is rather daft.
     
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  4. HUGH72

    HUGH72 Well-Known Member

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    Real rents didn't rise everywhere but actual rents did, inflation was high at the time.
    I don't think we can really judge too much from a 2 year window as its probably too short a timeframe, often investing decisions and especially development of new projects are not made overnight. Some markets may have been in over or under supply.
    If we had 5 or more years of data then we could make a more informed assessment .
     
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  5. Francesco

    Francesco Well-Known Member

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    +1

    Statistics are quantitative but collectively they produce patterns, which reflect the population. Sydney and other capitals have more dynamic rental markets than the rest of the country. Trying to see the same impact of policies across the country defies the reality of differences of rental markets.

    Existing rental lease durations and the intensity of the vacancy rates can delay the impact of rental rises that will take account of the new policies. If rental leases in urban areas tend to be shorter than in non urban areas then rents will rise earlier to incorporate the impact of new policies than in other areas. Similarly, if the city has existing high vacancy rates it may delay producing the rental rise due to abolishing NG. Many commentators merely delve into the data to get the outcome they want to see without understanding whether the data actually bears that out. This is to be expected due to the bias of political leanings. :rolleyes:
     
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  6. Natedog

    Natedog Well-Known Member

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    By the time any government actually decided to change the tax laws and got them passed.....an investor that owns property that is currently negatively geared.....will probably have turned positive.....it will take that long :)
     
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  7. mini2

    mini2 Well-Known Member

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    Surely it will grandfathered any existing properties and only kicks in for new purchases after a certain date?
     
  8. See Change

    See Change Well-Known Member

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    They tend to grandfather things , but can never be certain until anything is actually in place .

    Cliff
     
  9. Cinch

    Cinch Well-Known Member

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    Both labour and coalition federal MPs own on average 2 or more properties so I don't see NG going anytime soon, and especially not while coalition is in government for at least the next 4 y. If NG is reformed, it will only apply to purchases after the new law is established.

    http://www.smh.com.au/federal-polit...-negative-gearing-debate-20150326-1m8s36.html
     
  10. HUGH72

    HUGH72 Well-Known Member

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    Maybe they were rising due other factors but I don't think you can dismiss it that easily, the time frame was too short to make an accurate assessment, the amount of available public housing is also very different to 30 years ago.
    Public housing waiting lists were also affected at the time.
    A very generous capital building depreciation allowance of 4% was also introduced between 85 and 87 to encourage new building, a similar incentive is likely if there are significant changes to NG.