# Has the halving of capital gains tax benefited the economy?



## sydboy007 (15 January 2013)

I've often wondered if the halving of the capital gains tax for assets held over 12 months did more harm than good for the economy.  I think most would agree it was a mjor component of the house price boom we saw soon after it's introduction.  Not sure how much an impact it had on shares, but pretty much it made higher income earners see "capital gains" as a much better way to increase their income, than well working hard.

My understanding is when Costello asked John Ralph to do a taxation review he had a specific section looking at capital gains taxation.  Ralph seemed to go even further than what Costello was looking at but basically halving the marginal tax rate on capital gains, with the associated loss of capital indexation to CPI.

Maybe it's hindsight, but surely anyone would have realised what that would have done to the property market, yet he said instead he expected the cut to bring about a surge in sharemarket investment, "particularly in innovative, high-growth companies".  Still don't see how that would have been a benefit to the companies, as unless you are issuing new shares it's not having an impact on the funding of these companies.

To quote Costello “There is no conclusive evidence that the taxation system has had a significant effect on house prices.” 

I'd also argue that the new system is actually detrimental to the longer term investor due to the loss of capital adjustment due to CPI.  Seems the longer you hold an asset the worse off you could be depending on the rate of inflation and how you asset value holds up.

A lot of what I read reckons at the end of the day the changes were revenue neutral - considering the $8B or so in negative gearing losses each year I have my doubts.

Anyone know of some historical stats that show how much tax revenue has been lost to the halving of CGT?

Anyone like to share if it did / didn't change the way they plan their investments.

I'll come out and say I don't see why tax on income should be discriminated in favour of that earned by capital gains compared to wages or interest earned.  Seems to foster the mentality of going for broke, rather than being a bit more fundamental about the income an investment will make. 

As an aside, I hope we don't follow the republicans who want to remove taxation on capital gains.


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## tech/a (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



> I hope we don't follow the republicans who want to remove taxation on capital gains.




*Hell I do.*


Hold shares for 12 mths and you get a 50% reduction.
No capital gains on shares or property---*won me!*


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## drsmith (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*

With negative gearing left unchanged, there is no doubt in my mind that it helped to fuel the subsequent residential property boom.

The reasons are obvious. By replacing CPI indexation with the 50% discount after 12 months, it rewarded shorter term speculation and penalised longer term investment. 

A broader reaponse to the impact of high marginal tax rates on capital gains should have been considered. Perhaps a cap at the corporate tax rate in conjunction with the maintainance of CPI indexation. At the same time, negative gearing should have also been reformed. This may have provided additional scope to reduce marginal income tax rates.

The only good thing it had going for it is that it was simpler than the CPI indexation method it replaced.


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## tech/a (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



tech/a said:


> *Hell I do.*
> 
> 
> Hold shares for 12 mths and you get a 50% reduction.
> No capital gains on shares or property---*won me!*




Perhaps youll get some more *SELF FUNDED* retirees.

About time the Govt got serious with providing real opportunity to achieve it.!


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## McLovin (15 January 2013)

I'm all for getting rid of CGT. Just let me know what exactly the government will be cutting in order to pay for it. I have some ideas, see the Wasteful Liberal thread.

I can already see the headlines in the Tele...

"Families to pay for fat cat handout".


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## sydboy007 (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



tech/a said:


> Perhaps youll get some more *SELF FUNDED* retirees.
> 
> About time the Govt got serious with providing real opportunity to achieve it.!




Shouldn't the tax system be neutral?

To my way of thinking all income should be taxed in the same way, unless we've moved into all the income is equal, just some income is more equal than others world 

I think you can see what happens when tax becomes the primary consideration by looking at house prices in Australia


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## notting (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*

OK, I'll do it.



sydboy007 said:


> To my way of thinking all income should be taxed in the same way




I hope the treasurer never thinks like you.

I know what you think you mean, however, Napolean

One reason you might not like to think like you is this:

If you buy your family home for 500,000 sell it 5 years later for 800,000.
You will be paying income tax on 300,000 for the year you sell it in.
That's income for that year.
You won't be upsizing in a hurry

If that's not enough swill for thought
You might make a capital loss share trading during the financial crises of 10mil
Then make a capital gain the next year of 10mil and have to pay your tax on the 10mil even though you have made nothing.
Not even fair for Piggy.


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## FlyingFox (15 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



notting said:


> OK, I'll do it.
> 
> 
> 
> ...




Good points. This will cause liquidity issues in certain asset classes as people will not sell as easily. Alternatively they may not invest in the first place.

Much less of an issue if you have a flat tax rate for example.


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## Julia (15 January 2013)

sydboy007 said:


> I think you can see what happens when tax becomes the primary consideration by looking at house prices in Australia



Prices are very similar in New Zealand.  They have no CGT there.


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## medicowallet (15 January 2013)

I think that the 50% is rubbish too, it promotes speculation in both RE and shares.

BUT

I think the greater contributor to the housing bubble is the change in marginal tax rates.

They were absolutely ridiculous, but I think the liberals went a bit too far, and we need to allow bracket creep to take back some taxation.

Between taxation relief and middle class welfare, we are lucky imports have become so cheap over the past 10 years.

MW


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## drsmith (15 January 2013)

medicowallet said:


> I think the greater contributor to the housing bubble is the change in marginal tax rates.
> 
> They were absolutely ridiculous, but I think the liberals went a bit too far, and we need to allow bracket creep to take back some taxation.



I would have to disagree. The problem is not the rates but the base.

If marginal tax rates were reasonable then the need for measures that compromise the base would not be considered necessary.

By reasonable, I mean a top marginal income tax rate similar or the same as the corporate rate.


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## medicowallet (16 January 2013)

drsmith said:


> I would have to disagree. The problem is not the rates but the base.
> 
> If marginal tax rates were reasonable then the need for measures that compromise the base would not be considered necessary.
> 
> By reasonable, I mean a top marginal income tax rate similar or the same as the corporate rate.




Hang on, so are you saying that you don't think that changing of the marginal rate does not help promote a bubble.  I am really not understanding what you are trying to say (ie what you are disagreeing with)

MW


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## Superb Parrot (16 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



notting said:


> 1.If you buy your family home for 500,000 sell it 5 years later for 800,000.
> You will be paying income tax on 300,000 for the year you sell it in.
> 
> 
> ...




? 

1.There is no capitol gains tax on the family home, providing you reside in that home.

2. Capitol losses are carried forward.


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## drsmith (16 January 2013)

medicowallet said:


> Hang on, so are you saying that you don't think that changing of the marginal rate does not help promote a bubble.  I am really not understanding what you are trying to say (ie what you are disagreeing with)
> 
> MW



Marginal rates in isolation do not bias one form of investment over another.

It's compromises to the income tax base such as negative gearing and the deep discount to capital gains tax for assets held longer than one year that influence investment decisions. Super is another.

To fund these compromises, marginal rates are higher than they otherwise need to be and that enhances their effect.


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## tech/a (16 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



Superb Parrot said:


> ?
> 
> 1.There is no capitol gains tax on the family home, providing you reside in that home.
> 
> 2. Capitol losses are carried forward.




Nottings reply was related to



> To my way of thinking *all income *should be taxed in the same way




From Syd.


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## Superb Parrot (16 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



tech/a said:


> Nottings reply was related to
> 
> 
> 
> From Syd.




My errror....


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## medicowallet (16 January 2013)

drsmith said:


> Marginal rates in isolation do not bias one form of investment over another.
> 
> It's compromises to the income tax base such as negative gearing and the deep discount to capital gains tax for assets held longer than one year that influence investment decisions. Super is another.
> 
> To fund these compromises, marginal rates are higher than they otherwise need to be and that enhances their effect.




Well you are wrong, because when the liberals dropped marginal rates (and changed when they kicked in) it resulted in more $$$ in the consumers hand (hence why we are so lucky certain goods decreased in price mainly thanks to China et al)

So if I made $30000 more because of marginal rate reductions and geared it up, then if I can bid $300000+ more for a property now with my new income, and everyone else gets more $$$ at a certain level, I am sure that this contributes to price growth.

I never said marginal rate changes affected decisions, I just said that it contributed to house price growth, can you not see how this is so?  Remember negative gearing was around well before these changes started coming in.

MW


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## drsmith (16 January 2013)

medicowallet said:


> I never said marginal rate changes affected decisions, I just said that it contributed to house price growth, can you not see how this is so?  Remember negative gearing was around well before these changes started coming in.



Actually, you described it as the greater contributer. It's that I disagree with.

Any post tax increase in income is of course going to increase the consumer's spending power, but if where arguing against that, where really arguing against higher living standards.

In your example above, your ability to service a loan and hence the amount you could borrow and would be reduced if you didn't have access to the cashflow that negative gearing provides. Also, if there was no (or a reduced) CGT discount, the temptation to speculate would be further reduced.

It's the combination of tax cuts, negative gearing and the capital gains discount that led to the explosive house price rises that we saw, but that doesn't make the tax cuts in themselves wrong. It's the other elements that required the appropriate reform and the whole mix needed to be considered in that broader context. That was the failure of the Howard government. He could have used the revenue from the resources boom to undertake a broad reform of tax transfer and at the same time minimise any potential losers but instead concentrated more on short term populism with his tax/welfare changes.

In that broad context I would also say that his government overall doshed out too much of the resources boom revenue too quickly resulting in higher interest rates which were ultimately a contributing factor in his government's downfall, but that again doesn't make the tax cuts in isolation wrong.


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## FlyingFox (16 January 2013)

drsmith said:


> Actually, you described it as the greater contributer. It's that I disagree with.
> 
> Any post tax increase in income is of course going to increase the consumer's spending power, but if where arguing against that, where really arguing against higher living standards.
> 
> ...





Agreed. Add to this the FHOG + large LVR. Plus all the media and real-estate hype about the property millionaires.


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## medicowallet (16 January 2013)

drsmith said:


> Actually, you described it as the greater contributer. It's that I disagree with.
> 
> Any post tax increase in income is of course going to increase the consumer's spending power, but if where arguing against that, where really arguing against higher living standards.
> 
> ...




You are possibly unintentionally making a strawman against me.

I am making an argument for what has made the contribution for what has changed. Negative gearing was in place long before this bubble started.

You are arguing for whatever in the entirity of existence? for which I must say that the property boom in Australia is more related to the Captain Cook voyage than negative gearing, and hey why stop there, why not go back to either god or lightning strikes, whichever tickles your fancy.

Even going back to your argument, you could argue that deregulation of the banking industry and hence greater gearing ratios has more of an effect than negative gearing, as negative gearing only applies to IP with loans and gearing applies to all investments with loans.

I guess I disagree with the possible strawman, and I stand by that of the changes made, lowering of the marginal tax rates has provided much more cash to be geared (for personal or investment properties) for purchase price increases, a bit like the FHVB allows geared speculation as well.

MW


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## sydboy007 (16 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



tech/a said:


> Nottings reply was related to
> 
> 
> 
> From Syd.




Personally I prefer the US system:

Under 26 U.S.C.  § 163(h) of the Internal Revenue Code, the United States allows a home mortgage interest deduction, with several limitations. First, the taxpayer must elect to itemize deductions, and the total itemized deductions must exceed the standard deduction (otherwise, itemization would not reduce tax). Second, the deduction is limited to interest on debts secured by a principal residence or a second home. Third, interest is deductible on only the first $1 million of debt used for acquiring, constructing, or substantially improving the residence, or the first $100,000 of home equity debt regardless of the purpose or use of the loan.

I think in Australia the combination of CGT relief and negative gearing encourages over investment of Property, and the CGT free status of the primary residence encourages a great deal of overcapitlisation of property, and it benefits the very rich far more than the avg or even above avg.  The sale profit of most high end property is far in excess of what us mere mortals can hope to achieve.

We need a tax system that is neutral.  Where you invest / save your money should not have tax as a primary consideration.


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## McLovin (16 January 2013)

*Re: has the halving of capital gains tax benefited the economy??*



sydboy007 said:


> I think in Australia the combination of CGT relief and negative gearing encourages over investment of Property, and the CGT free status of the primary residence encourages a great deal of overcapitlisation of property, and it benefits the very rich far more than the avg or even above avg.  The sale profit of most high end property is far in excess of what us mere mortals can hope to achieve.




I think the biggest reason for over capitalisation of property is the high transaction taxes already in place. Although it's fitting with the mentality that the family home is a for profit business. Primary residence should not have any transaction charges associated with it. For whatever reason, people often need to move houses, it makes no sense to tax them for the privlege.


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## sydboy007 (16 January 2013)

Interesting to note that since the halving of CGT that net rental income for IPs has been negative in Australia


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## drsmith (17 January 2013)

medicowallet said:


> I am making an argument for what has made the contribution for what has changed. Negative gearing was in place long before this bubble started.



You can look at it that way if you wish, but in the broader context of tax reform, that serves little purpose.



medicowallet said:


> Even going back to your argument, you could argue that deregulation of the banking industry and hence greater gearing ratios has more of an effect than negative gearing, as negative gearing only applies to IP with loans and gearing applies to all investments with loans.



My views on negative gearing of salary based income against unrelated investment activity is not limited to property.



medicowallet said:


> I guess I disagree with the possible strawman, and I stand by that of the changes made, lowering of the marginal tax rates has provided much more cash to be geared (for personal or investment properties) for purchase price increases, a bit like the FHVB allows geared speculation as well.



There's no strawman. We are simply looking at the issue from different perspectives. If you still wish to limit your context to what changed, consider the graph in the post above. That being said, I still prefer to consider tax reform from the broader context from which I have made my point.


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## drsmith (17 January 2013)

sydboy007 said:


> Interesting to note that since the halving of CGT that net rental income for IPs has been negative in Australia



Where did you find that ?


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## Bill M (17 January 2013)

sydboy007 said:


> Interesting to note that since the halving of CGT that net rental income for IPs has been negative in Australia




My rental income has been going up each year with or without the halving of CGT. What are you talking about? I am making more money now than what I was 3 years ago or 10 years ago and I will be further raising it later this year.


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## FlyingFox (17 January 2013)

Bill M said:


> My rental income has been going up each year with or without the halving of CGT. What are you talking about? I am making more money now than what I was 3 years ago or 10 years ago and I will be further raising it later this year.




What is the ratio of your rental income to the current property valuation? What was it 3 yrs ago? what was it 10 yrs ago?

Compare that with interest on your valuation (or loan) and you come to negative rental income.


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## Bill M (17 January 2013)

FlyingFox said:


> What is the ratio of your rental income to the current property valuation? What was it 3 yrs ago? what was it 10 yrs ago?
> 
> Compare that with interest on your valuation (or loan) and you come to negative rental income.




Ok I get where you are coming from. My situation is a bit different, my IP is mortgage free, I don't owe any money on it and it has been like that for 10 years.

The point I was making was that not everybody is the same.


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## FlyingFox (17 January 2013)

Bill M said:


> Ok I get where you are coming from. My situation is a bit different, my IP is mortgage free, I don't owe any money on it and it has been like that for 10 years.
> 
> The point I was making was that not everybody is the same.




That's true but there are more people in the situation pointed to by syd than in yours Bill as illustrated by the graph syd put up.

Your probably getting great returns. Even in your case, it's arguable that at the peak circa 2007 that you would have been better off selling your property. Obviously that has changed now with the decreasing interest rates.


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## sydboy007 (17 January 2013)

Bill M said:


> My rental income has been going up each year with or without the halving of CGT. What are you talking about? I am making more money now than what I was 3 years ago or 10 years ago and I will be further raising it later this year.




What is the value of the IP?

What is the rent less all holding costs?

What maintenance costs have you incurred?

What is the net rent as a % of the value of the property?

I would be surprised if it was above 5%

What kind of capital growth do you expect over say the next 5 years?


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## sydboy007 (17 January 2013)

drsmith said:


> Where did you find that ?




the graph i showed from the ATO shows that in net all IPs are running at a loss.  Now there will be some that are positively geared, or have no mortgage, but the overwheling number of IPs with a mortgage are loosing in aggregate around 5B and that's with interest rates are historically low levels.

You can see that net rental income has been negative since 2000 which is the first tax year after the CGT changes were introduced (IIRC)


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## Bill M (18 January 2013)

sydboy007 said:


> What is the value of the IP?
> 
> What is the rent less all holding costs?
> 
> ...




Sorry for the late reply.

It is valued conservatively at around 420K. My net return after tax and all expenses is around 4%.

I expect it will grow in value by 20% in 5 years. There is no evidence to provide that this will happen, it is just what I think. If it stagnates then I will have to make do with my 4% net income. It is a risk I am prepared to take.


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## sydboy007 (18 January 2013)

Bill M said:


> Sorry for the late reply.
> 
> It is valued conservatively at around 420K. My net return after tax and all expenses is around 4%.
> 
> I expect it will grow in value by 20% in 5 years. There is no evidence to provide that this will happen, it is just what I think. If it stagnates then I will have to make do with my 4% net income. It is a risk I am prepared to take.




4% less income tax??

I know people feel more secure with physical property, and when you have idiots like at JP morgan and Rio burning through shareholder wealth like a politician with a funding promise, shares can seem rather risky.

But I console myself with the fact that i can get 6% yield with little effort, and still make 5% after tax.

in a super fund the return is even better


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## FlyingFox (18 January 2013)

sydboy007 said:


> 4% less income tax??
> 
> I know people feel more secure with physical property, and when you have idiots like at JP morgan and Rio burning through shareholder wealth like a politician with a funding promise, shares can seem rather risky.
> 
> ...




But you missed out the part about 20% cap gains .....


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## Bill M (18 January 2013)

sydboy007 said:


> 4% less income tax??
> 
> I know people feel more secure with physical property, and when you have idiots like at JP morgan and Rio burning through shareholder wealth like a politician with a funding promise, shares can seem rather risky.
> 
> ...




No, it is 4% after tax as we both fall into lower tax brackets it isn't so high.

As for your yield elsewhere, I agree and that is why I only have the 1 IP. I too have a portfolio of hybrids and some bank shares all returning 6% plus, cheers.


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## drsmith (19 January 2013)

sydboy007 said:


> the graph i showed from the ATO shows that in net all IPs are running at a loss.  Now there will be some that are positively geared, or have no mortgage, but the overwheling number of IPs with a mortgage are loosing in aggregate around 5B and that's with interest rates are historically low levels.
> 
> You can see that net rental income has been negative since 2000 which is the first tax year after the CGT changes were introduced (IIRC)



What I'm interested in is some background information/underlying document.

Do you have a link ?


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## moXJO (19 January 2013)

sydboy007 said:


> 4% less income tax??
> 
> 
> But I console myself with the fact that i can get 6% yield with little effort, and still make 5% after tax.
> ...




He has access to cheap money. He may also in the future  have the ability to build units. Too much of a simplistic view on property on this forum.


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## FlyingFox (19 January 2013)

moXJO said:


> He has access to cheap money. He may also in the future  have the ability to build units. Too much of a simplistic view on property on this forum.




On the contrary. The above comments on serve to confirm what we are saying i.e that due to the way the system is setup (negative gearing, CGT concession etc etc), investors are only focusing on capital gains and not worried about yields.

If I have access to cheap money and can develop a property, I will want to sell it because the CG on it will most definitely outstrip any incentive to lease it out.


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## sydboy007 (19 January 2013)

drsmith said:


> What I'm interested in is some background information/underlying document.
> 
> Do you have a link ?




Alas no.  I got that graph off whocrashedtheeconomy

Philip soos seems to be a prolific writer regarding the giant ponzi scheme that Australian Property has now become


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## moXJO (20 January 2013)

FlyingFox said:


> On the contrary. The above comments on serve to confirm what we are saying i.e that due to the way the system is setup (negative gearing, CGT concession etc etc), investors are only focusing on capital gains and not worried about yields.
> 
> If I have access to cheap money and can develop a property, I will want to sell it because the CG on it will most definitely outstrip any incentive to lease it out.




There are plenty out there holding for the yield depending on the location. I can develop 3 townhouses and keep one at low cost for yield, or do the research and get in early on a future mining towns . Its not a one strategy suits every area. 

 If I have access to cheap money I can buy shares or business equipment without worrying about selling for cap gains, perhaps I want to wait and buy the houses next door as well. It depends how far ahead you look or if the figures and future profitability no longer make sense to hold.
I was getting at the fact that people seem to think everyone buys and holds property  in a vanilla fashion and thats what you are limited. That and the attitude you cant make money at this stage of the cycle.
I think there are just some people peed off property near the center of town doesnt crash like shares.

I will agree that the system is setup in favor of quicker sales on the basis of grabbing more tax on transactions.


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## sydboy007 (20 January 2013)

moXJO said:


> There are plenty out there holding for the yield depending on the location. I can develop 3 townhouses and keep one at low cost for yield, or do the research and get in early on a future mining towns . Its not a one strategy suits every area.
> 
> If I have access to cheap money I can buy shares or business equipment without worrying about selling for cap gains, perhaps I want to wait and buy the houses next door as well. It depends how far ahead you look or if the figures and future profitability no longer make sense to hold.
> I was getting at the fact that people seem to think everyone buys and holds property  in a vanilla fashion and thats what you are limited. That and the attitude you cant make money at this stage of the cycle.
> ...




I knew a guy who bought a property in the west of Sydney with the intention of building townhouses on it.

After the experience he had with getting the plans through council and the delays and costs involved, he's given up on doing it again.  He made money, but he was lucky to have a decent capital buffer to help with the holding costs.

If there is money to be made in property, there's only a few areas left, nad I would think that the higher the yield on the property, the lower the chance of capital gains, and the bigger the erosion of CPI when you do come to sell.


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## moXJO (20 January 2013)

sydboy007 said:


> If there is money to be made in property, there's only a few areas left, nad I would think that the higher the yield on the property, the lower the chance of capital gains, and the bigger the erosion of CPI when you do come to sell.



You are way off the mark, is this just more off the top of your head brain fart kind of figures.

Keep thinking that way though. Its not for everyone.


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## FlyingFox (20 January 2013)

moXJO said:


> There are plenty out there holding for the yield depending on the location. I can develop 3 townhouses and keep one at low cost for yield, or do the research and get in early on a future mining towns . Its not a one strategy suits every area.
> 
> If I have access to cheap money I can buy shares or business equipment without worrying about selling for cap gains, perhaps I want to wait and buy the houses next door as well. It depends how far ahead you look or if the figures and future profitability no longer make sense to hold.
> I was getting at the fact that people seem to think everyone buys and holds property  in a vanilla fashion and thats what you are limited. That and the attitude you cant make money at this stage of the cycle.
> ...




If you bought before the peak, good on you and you will be on a nice yield. A family member developed a commercial prop ~ 2001 and is getting ~25% yield and 600% CG. This wasn't in oz but you get the picture. If they wanted to do that today their yield would be ~7-10% and very little chance of CG.

If you think developing townhouses is a risk free investment, good for you. If I can't sell one out of the three, I will be in trouble. With props selling below replacement costs, I for one am not willing to take the risk. If your a seasoned developer or builder than that's different. Mining towns I agree with but again a more risky proposition. 

Having access to cheap money should be secondary to the discussion about property investments. You will only have access to cheap money if you pay of the mortgage or get cap gains. If I have the money, why don't I just invest it in shares. Why do I need to buy an IP?

Buying and holding is the most common investment strategy hence the most discussed one. The other case is for trading and not necessarily investing. If you want to trade or develop properties, then we can have a discussion on that basis. If you are buying an IP *now* with yields ~ 4% (and negatively geared?) on the basis of cap gains then there maybe better investments.

Quicker sales with big taxes means big increase in prices => bubble. Not an effective use of money.




moXJO said:


> You are way off the mark, is this just more off the top of your head brain fart kind of figures.
> 
> Keep thinking that way though. Its not for everyone.




Syd just provided anecdotal evidence (actually more than you did in that he named an actual place). You don't have to agree with it but don't insult him on that basis.


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## moXJO (20 January 2013)

Have had 3 large posts wipe on me so will keep it short. No skin in the game usually means talking outa ones ass when it comes to investing. Sorry to be harsh damn post wipe gave me the ****z


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## Julia (20 January 2013)

moXJO, let Joe know about your post being wiped.  It's an apparent peculiarity only a few of us have experienced.  It has only ever happened to me when doing an especially long post.
Incredibly irritating.


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## sydboy007 (21 January 2013)

To shift away from the focus on property, wouldn't it be better if the halving of the capital gains tax was only for:

New housing stock
New shares / IPOs
Any new asset

I don't see how the halving benefits "investment" when it's available for existing assets.  it doesn't benefit a company on their current shares, but it would if people could gain it on new purchases.  Same for IPs as it would encourage the building of new properties.

The current system encourages speculation and the pursuit of converting income into capital gains.


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## drsmith (21 January 2013)

Julia said:


> moXJO, let Joe know about your post being wiped.  It's an apparent peculiarity only a few of us have experienced.  It has only ever happened to me when doing an especially long post.
> Incredibly irritating.



I don't recall having this happen here, but on another forum it did.

I quickly learned with longer posts that it was a good idea to save them to a text editor before hitting the reply button, just in case.


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