Changes to Negative Gearing in Australia Property Market

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Webb
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Changes to Negative Gearing in Australia Property Market

Post by Webb » Mon Feb 15, 2016 11:21 am

Changes to Negative Gearing in Australia Property Market
BOTH sides of politics are working on bold economic reforms that could help first home buyers enter the property market.
The Federal Government and the Opposition are each looking at major shake-ups to negative gearing — the practice that allows investors to offset losses on investment properties against their taxable income, in order to gain a tax break.
As it applies in the housing market, negative gearing has long been accused of locking struggling first home buyers out of the market while benefiting cashed-up investors, and even of contributing to soaring house prices.
Both parties will take their policies to the next election, and it could be first home buyers who emerge as winners.
from http://www.news.com.au/finance/work/lea ... 18f44be5e1

So the negative gearing era is about to be changed.

So what, all the rich are happy now and who cares if it changes, they already have their 5 - 50+ IP's mostly now paid off and their PPOR to live in. They might as well scoop up another bundle of properties before any changes happen in 2017 or whenever just for fun.

Then there is the recent and ongoing flood of foreigners buying up all our prime real estate that should have been stopped long ago. The latest events are the result of them screwing our property industry, it's not their fault though, they just took advantage of an open market that the politicians created for their own schedules.

Now the new genuine Aussie home buyers and those hoping to one day get on the property train will be battling to even afford one or two properties and any changes are to make it hard for them to be property investors. Shouldn't they be looking to tax those who don't really deserve it or can afford it, the ones mentioned above?



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gaz
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Re: Changes to Negative Gearing in Australia Property Market

Post by gaz » Fri Feb 19, 2016 5:49 am

we will see

doowap
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Re: Changes to Negative Gearing in Australia Property Market

Post by doowap » Fri Apr 08, 2016 3:35 am

Negative Gearing is a bad idea not only for those waiting to buy residential property (1st home) but also investors with less than 1 million dollars invested.
The reasons are as follows:
-The tax system allows 19,000 without paying any tax anyway, this negates the value of less than nearly $400 a week in received rent coz this money invested elsewhere would not be subject to tax anyway.
-Although the tax is refundable your family allowances and benefits are not so you would lose these benefits.
-Accountants are usually required to handle tax refunds and they charge hundreds more for each property they handle.
-Real estate agents charge high fees for advertising and finding tenants, about $60 a day when no income is coming in, not to mention their ongoing commissions. Its in their best interest to find undesirable tenants coz now they make more from tenant-finding through tenant turnover.
-Introduction of GST in return for lower income tax means there is less of a tax pool to draw upon than previously.

doowap
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Re: Changes to Negative Gearing in Australia Property Market

Post by doowap » Fri Apr 08, 2016 3:53 am

The reason the government promotes this system is they want regular low and middle class investors to jump on the badwagon and start voting as investors despite the fact they are losing money coz they (with over 1 million invested and in the highest tax bracket) receive the lions share of these tax benefits and they want to keep this perk going, not for you but for themselves (they want us to represent them).
Added to this is you will be doing yourself out of family and welfare benefits coz now ur income is over the benefits threshold (benefit thresholds are not tax deductible).
The long plan for government is to lower the pension by introducing a means test on total assets (including family home)and requiring those over a threshold to pay their own medical upon retirement, so you will be doing yourself out of a pension as well. Google this.
Unless you have over $1,000,000 (minimum) investment and in the highest bracket it wont work for you.

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