My apologies, if I added to your disappoint, the issue seemed to escalate due to people trying to put forward options, when that isn't what the other side wanted. The other side only wanted a forum to vent on, which is o.k, but it did go on and become a circular discussion.Well I think I’ve followed this forum enough now. I’ve got better things to do. I’ve added my 2 cents worth, which in short is, as a boomer I believe it’s more difficult to get on the housing ladder today than when I was a 20 year old.
Open discussion of opinions is good but this, for me, just seems to be an argument.
I’m off for a beer, but as a leaving comment, I pay tax, but I can’t vote, so what can I do ? I’m an immigrant.
I am sorry to see this good, interesting forum discussion on a really interesting and important topic being dragged in to one of insults and non bi partisan discussion.
Oh well moving on to see what the adults are discussing.
Gunnerguy
(sad and depressed that this interesting discussion has just gone downhill)
It certainly shows there is a fundamental flaw when your housing market, is worth more than your stock market, especially when you consider there are only about 10 million private dwellings in Australia at the 2016 census.To me this is just insane. And I trade crypto and meme stocks.
Australian domestic housing worth $8 trillion--this is exactly why governments (left, right, center) will never make serious changes to the housing market. They all know it will have a devastating impact on the economy. All governments are idiots, but they are smart enough to know that they do not want to be responsible for killing off a market worth $8 trillion. The great Aussie dream shifted a long time ago from owning your own house to being able to own an investment property.To me this is just insane. And I trade crypto and meme stocks.
They dont mind fiddling with super thoughAustralian domestic housing worth $8 trillion--this is exactly why governments (left, right, center) will never make serious changes to the housing market. They all know it will have a devastating impact on the economy. All governments are idiots, but they are smart enough to know that they do not want to be responsible for killing off a market worth $8 trillion. The great Aussie dream shifted a long time ago from owning your own house to being able to own an investment property
This is without doubt one of the biggest ill-informed brain farts I've heard from a politician. Sure, lets allow people to put more money into a market that is already awash with lots and lots of cheap money. Is there no end to politicians' inability to tackle this problemIt looks as though the situation has gone far enough, lets see if anything is done, talk is one thing action is another.
From the article:Liberal MPs suggest radical plans to tackle housing affordability crisis
Liberal MPs are demanding the federal government consider radical plans to bring the runaway housing market under control.www.theage.com.au
For this reason, Mr Wilson wants first home buyers to be able to tap into their superannuation for a deposit.
I agree, dipping into super wont do a thing, same as reducing stamp duty, that IMO is just another brain fart that will just allow people to borrow more money and push the prices up by the amount the stamp duty drops.Maybe old mate Tim Wilson should stop making superficial statements about solutions and do a little research into the potential impact of what he's suggesting.
I'm on the fence with negative gearing--I'm not convinced it is the driver of the recent ramp in house prices. Not saying it isn't a contributor, I question whether it is the root of all evil. Recent ATO data (maybe posted here) shows deductions of IPs have been reducing and more properties being breakeven or positively geared--which is put down to reduced interest expenses and rising rents. To me the major issue we currently have is down to cheap and easy money. Now I'm no economist but if this is the issue then why not tackle the problem head on. Why not allow folks current market interest rates for the PPOR, but you want a second house for an investment, well jack the interest rate right up for that. Of course to your point of negative gearing I acknowledge that jacking up interest rates will potentially allow greater interest rate deductions but that could be limited. This of course assumes that the problem is investors and I have not seen any data to support the fact that investors are the ones driving the prices up. My only limited observations on the houses that have been selling around me is that they are owner occupiers buying and not investors. I don't for one minute suggest there is a simple solution to this problem, but I do wish the governments would stop paying lip service to the issue and tackle it head on.I agree, dipping into super wont do a thing, same as reducing stamp duty, that IMO is just another brain fart that will just allow people to borrow more money and push the prices up by the amount the stamp duty drops.
IMO they just have to remove all negative gearing on all residential property new and established, until some sort of equilibrium is found, grandfather existing for 24 months to give people time to bail out. Then remove interest as a tax deduction on a housing investment loan, it would cause some pain for a while, rents would go up, prices would go down, but it has to be better than the current ponzi scheme.
Jeez Sydney /Melbourne have become government guaranteed money making gambles, that is just tax payer funded roulette, with every number a winner.
If the negative gearing isn't a driver, it should have minimal effect, therefore removing it shouldn't cause a problem.I'm on the fence with negative gearing--I'm not convinced it is the driver of the recent ramp in house prices. Not saying it isn't a contributor, I question whether it is the root of all evil. Recent ATO data (maybe posted here) shows deductions of IPs have been reducing and more properties being breakeven or positively geared--which is put down to reduced interest expenses and rising rents. .
Couldn't agree more. I wasn't advocating that it should remain as is...I was in a round about way suggesting your point. Tinkering with it or removing it is--IMHO--unlikely to take any broad based heat out of the market and that the solution would probably require something far more significant than a focus on neg gearing.If the negative gearing isn't a driver, it should have minimal effect, therefore removing it shouldn't cause a problem.
Nothing but mild tweaking and nothing but talk about it either.It looks as though the situation has gone far enough, lets see if anything is done, talk is one thing action is another.
From the article:Liberal MPs suggest radical plans to tackle housing affordability crisis
Liberal MPs are demanding the federal government consider radical plans to bring the runaway housing market under control.www.theage.com.au
Liberal MPs are demanding the federal government consider radical plans to bring the runaway housing market under control after new figures showed the value of the nation’s homes soared by a record $450 billion in three months.
Sydney MP John Alexander said some of his own government’s policies were feeding into dysfunctional property market while Melbourne MP Tim Wilson said the tax system has to be overhauled to bring some balance back to house prices.
Data from the Australian Bureau of Statistics released on Tuesday showed dwelling prices jumped by 5.4 per cent through the March quarter, the largest quarterly lift since the end of 2009.
All cities reported an increase, led by Sydney (up by 6.1 per cent). Canberra prices jumped by 5.6 per cent, in Perth they were up by 5.2 per cent while in Melbourne they increased by 5.1 per cent.
The total value of the nation’s 10.6 million residential dwellings increased by $450 billion to $8.3 trillion, the single largest quarterly rise on record.
Mr Alexander said all governments had to work together to put in place policies that would gradually bring house prices down to about three times annual household income. In parts of Sydney, they are currently at 17 times income.
He believes an independent authority should set the proportion of losses an investor could deduct for their investment properties, based on trends in the property market.
Similar to how the Reserve Bank targets an inflation rate of between 2 and 3 per cent, this authority could be able to reduce deductibility to 50 per cent of expenses when investor activity is driving up house prices.
“I think you have to put in place policies that are far sighted, ones that make our biggest asset class as safe as houses,” he said. “The common wealth of this nation is tied to home ownership. But we now have home ownership at its lowest level in 60 years.”
“There are too many factors driving money into homes to think if we just tinker with supply, prices will decline – the biggest barrier for young Australians to buy their first home is saving enough for a deposit while renting,” he said. For this reason, Mr Wilson wants first home buyers to be able to tap into their superannuation for a deposit.
He also wants a rebasing of the tax system, with the same rate of tax applied to income also applied to capital growth. Several other Coalition MPs support his push, including Senator Gerard Rennick who wants capital gains tax charged on homes sold for more than $2 million.
Labor’s housing spokesman Jason Clare said the federal government could take some pressure out of the market by backing the efforts of NSW and the ACT to get rid of stamp duty.
“A bit of leadership from the federal government is desperately needed here. Getting rid of stamp duty is a good idea and the federal government could help coordinate this across the country,” he said.
“Doing this will cut the cost of buying a home by tens of thousands of dollars and also get rid of one of the big obstacles that stops people moving and downsizing. We also need to build more affordable housing and more social housing.”
NZ recently tried something with not much resultsNothing but mild tweaking and nothing but talk about it either.
Even if all this stuff happens (it won't) it won't do a damn thing about the problem anyway. Classic case of trying to make it look like you're doing something.
negative gearing?NZ recently tried something with not much results
Repeating myself yet again:NZ recently tried something with not much results
Jeebus. I thought they could only halve you !The bit when it goes 70/30
That is true, if they wanted to prick the housing bubble, just crank up interest rates.Couldn't agree more. I wasn't advocating that it should remain as is...I was in a round about way suggesting your point. Tinkering with it or removing it is--IMHO--unlikely to take any broad based heat out of the market and that the solution would probably require something far more significant than a focus on neg gearing.
Do you really believe negative gearing cost money to the government?That is true, if they wanted to prick the housing bubble, just crank up interest rates.
The problem with that, highlights my issue with negative gearing, if interest rates go up it affects home owners much more than investors as they can't write off their loses.
Negative gearing on residential property just encourages non productive investment, to supply social housing IMO.
The money would be better spent supplying industrial growth, that has a chance of employing people and maintaining living standards.
The Government should be supplying social housing and if they want to help people get into a house, possibly allow first home owners to negative gear their loan, not investors.
Or at least move in that direction, as is shown in Melbourne/Sydney, a lot of investment money is directed into property with no hope of it ever being positively geared and any losses are subsidised by the taxpayer. What is the point?
Just my thoughts and I'm no economist.
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