Shorten again endorses negative gearing reform

Via the AFR:

As Sydney and Melbourne house prices continue to fall, Mr Shorten signalled that an originally planned July 1, 2019 start date could be deferred until 2020.

He said Labor remained committed to its three-year policy of reforming negative gearing to make the system fairer for first-home buyers against investors who now receive a taxpayer “subsidy”.

“At a point after the election, before our first budget or at our first budget that [negative gearing] will change,” Mr Shorten said on Friday in response to a question from The Australian Financial Review.

Nicely misleading phraseology there. Labor mooted these two dates long ago and not in response to “as Sydney and Melbourne house prices continue to fall”. It previously said that it would install the changes mid-2019 if the election was held this year. If the election was held on the May 2019 timetable then the reform would be pushed out to mid-2020.

Comments

    • Meh. It’ll be easy to reform when speculators realise capital gains aren’t likely in the future as housing market begins to act like a market (ie. Goes up And down). No use saving a little in interest when you stand to lose a lot in capital. Also if they can effectively communicate that negative gearing is predominantly a subsidy for the top quarter of “earners” and tie it in with the general systemic unfairness experienced by everyday Australians, they’ll push it through easy.

    • Housing is falling and it’s obvious to the average punter. THere will be no negative gearing reform. That would require a spine, which doesn’t exist in Australian politics.

      • I know stupid people who are holding onto their investment properties. One of my smart mates put his investment property on the market soon after doughnut day. Prices in Sydney are now 9% below peak and stupid people are still holding onto their investment properties.

        But I do not know how long the price slump will last.

        Shorten could legalise the foreign purchase of Aussie houses and that may bring prices back up.

      • @Jacob – is it stupid though? I thought about this; property is illquid especially currently when there is a downturn. Stamp duty and other transaction costs also bite especially at the 500-700k range (Sydney, Melbourne) which what many investment properties are aimed at geared at renters. To get back out (with your investment money which in the long run is worse in cash) and get back in later (if you can pick the absolute bottom which is no guarantee) is quite a chunk of money and a lot of hassle. If Labor change the laws any new property won’t have the CGT exemptions and such either which IMO matters more than negative gearing. Especially if rent is covering the mortgage and your not too leveraged. Its a question of how deep you think the price falls will be and if/when it will recover. Sure you wouldn’t be buying now but if you have a property already the getting in and out is a slightly different equation maybe? i.e. if your property is part of an asset allocation and you have covered your bases maybe its fair; if your a 5 property under 30 something gambler who’s attended a spuiking property investment seminar maybe not.

    • Shorten is taking a political risk in advocating quite mild negative gearing reforms, it is reason why Labor aren’t polling like 60% of the two party preferred vote at the moment.

  1. Jacinda Ardern also said the right things before the election. So did Gillard and Winston Peters.

    They are no consequences for lying. No wonder the profession is full of psychopaths.

    “skilled” immigration:

    17 hours ago

    a forged Indian driver licence that was used to obtain a licence in NZ.

    Mr Singh has been in New Zealand since 2009 when he arrived as a dependent of his wife while she studied in the country.

    https://www.sbs.com.au/yourlanguage/punjabi/en/article/2018/12/06/migrant-faces-deportation-over-fake-indian-driver-licence

    Students eh? The wife comes here to “study” and the “dependant” husband comes over to work full time in jobs that Aussies/Kiwis used to do.

  2. Yawn..
    I’ll hold off on claiming my “it’ll never happen” prize until 2022 just to be nice to you all………
    In the current environment – No Chance.

Leave a reply

You must be logged in to post a comment. Log in now