CHANGES TO NEGATIVE GEARING NOT THE ANSWER TO HOUSING AFFORDABILITY

June 7th,2016

CHANGES TO NEGATIVE GEARING NOT THE ANSWER TO HOUSING AFFORDABILITY

One of the key issues raised by Australians in response to the information campaign currently underway with the real estate industry is housing affordability, based on Labor proposing that any affordability problems can be resolved by changing current taxation arrangements negative gearing on existing properties and capital gains tax.

This suggestion is quite simply not true according to the President of the Real Estate Institute of Australia, Mr Neville Sanders.

“With large increases in house prices, particularly in our two largest capital cities, there have been many claims that the current tax treatment of negative gearing and capital gains of residential property is exacerbating housing affordability issues. This is simply not the case.”

“It is supply that is the critical factor in resolving the affordability problem. Changes to current taxation arrangements as proposed will do nothing to address affordability. If anything it will exacerbate the problem.”

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