HI-RISE HARRY WRITES NEGATIVE GEARING ATTACK … WRONG!!

WHAT * Harry has omitted to mention are the Chinese Government Capital Controls … too much Renminbi/Yuan  was leaving their shores to be laundered in Australian Real Estate … that is what really brought about the reduced Chinese interest in our Real Estate … however as recently as October 2018 the SCOMO Govt exempted the Real Estate Gatekeepers from the Anti-Money Laundering Rules … hm …

ON Negative Gearing …

 

View these links to find the facts and/or search for more!

Negative Gearing What It Means for Renters

https://caanhousinginequalitywithaussieslockedout.wordpress.com/2019/05/11/negative-gearing-what-it-means-for-renters/

Landlords in Sydney’s richest postcodes make biggest negative gearing claims: ATO

https://caanhousinginequalitywithaussieslockedout.wordpress.com/2019/04/23/why-labors-negative-gearing-policy-will-enhance-australias-economy/

Grattan Institute Calls Out Property Lobbyists “Scare Campaign” on Negative Gearing

https://caanhousinginequalitywithaussieslockedout.wordpress.com/2019/04/18/10412/

WENTWORTH COURIER ONLY. Harry Triguboff in his office at Meriton. Picture: John Appleyard

Photo:  Wentworth Courier Only.  Harry Triguboff in his office at Meriton. Picture: John Appleyard

Harry Triguboff: Wrong time for Labor’s negative gearing changes

The property development industry is one of the largest employers in Australia. It employs around one in four people in NSW and provides substantial income for the government through stamp duty, land tax, GST and employment taxes that fund the services and infrastructure that we need.

At this point, I wouldn’t be ­surprised if many of those people ­involved in the business are concerned about job security, particularly in the residential development sector and in major capital cities where no residential projects of any substance are starting.

Only infrastructure projects are keeping us going, and those in turn are reliant on the money generated from the property business, meaning that they are in jeopardy, too.

These concerns are further heightened by the possible changes to negative gearing and capital gains tax proposed by the ALP.

This is not necessarily because they have developed a wrong policy, but because now, when the market is weak, is the wrong time to bring it in.

Implementing Labor’s proposed changes now means that the policy won’t achieve its intentions while still imposing negative consequences for everyone.

*The present downturn started in July 2017 with the introduction of significant foreign investor surcharges. These were followed by the banking royal commission, restrictions on access to finance, political uncertainty with a number of state elections and now the federal elections — and don’t get me started on the planning system. But these measures have now had their desired effect, and much more in my opinion, so now is time for certainty and stability.

CAAN:  LOOK at the following …. and question!
View the links above for the facts on Labor’s changes to Negative Gearing.

The proposed policy of removing negative gearing is based on the need to reduce house values while at the same time generating more government income. It should definitely make homes cheaper if that’s what is needed, but won’t generate more money unless the market is strong.

Instead, what we will see is it will make a weak market even weaker, reducing supply and likely increasing property prices.

Labor’s policies, if implemented now, will be bad for everyone as it will exacerbate and prolong the downturn we are currently experiencing

Housing construction in Sydney is down at least 40 per cent from its peak and that a severe residential supply shortage is looming, says developer Harry Triguboff. Picture: AAP

The time to abolish negative gearing would be when prices are going up. But if we do it now, the construction of housing will fall even further, meaning that prices will probably go up as we will not build enough.

We already know that construction in Sydney is down at least 40 per cent from its peak and that a severe residential supply shortage is looming. Any policy changes should be supporting growth.

Fewer people will buy investment properties because negative gearing will not be allowed on old properties. Even if it helps with new properties, any gains will now be taxed more so they will have less incentive to purchase investment properties — whether old or new.

Even if someone buys new to get the negative gearing benefits, they will know full well that these benefits will not be available to the next ­person which reduces the attractiveness, not to mention additional ­capital gains tax.

This will also mean the many ­people who rely on the building industry will lose their jobs and businesses.

If the market is not strong, the ­assumption that more money for government will be generated will not occur. Treasury will lose the money to fund hospitals, schools, roads and rail they have promised the voters.

It is not only these statutory payments that are threatened. It is also the extras we have to give like affordable housing, extra payments, parks, roads and so on that councils and state governments want when we supply the additional housing that they need.

Our population continues to grow so it’s not like we don’t need the housing. A shortage as early as 2021 in Sydney has been identified. We need migrants because they are essential for our workforce.

If we need migrants and foreign workers, we need more housing. Abolishing negative gearing which assists investors will ensure that the economy will suffer because fewer housing units will be built.

There is, of course, talk about build to rent (BTR), but we are already blessed with our own BTR scheme where individual mums and dads can invest which provides the housing and helps them secure their future. This is facilitated by negative gearing.

Labor’s policies, if implemented now, will be bad for everyone as it will exacerbate and prolong the downturn we are currently experiencing, which would risk tens of thousands of jobs and substantial government revenue that comes from a productive property industry that pays for services and infrastructure we require.

We are seeing signs of recovery in the market and providing apartments is becoming more attractive.

Negative gearing benefits should be kept as is as they encourage investment in housing which will provide the housing, jobs and the money the government and the economy needs.

If we do anything to put the brakes on this recovery, any improvement will be short-lived.

Harry Triguboff AO is the founder and managing director of Meriton

SOURCE:  https://www.dailytelegraph.com.au/news/opinion/harry-triguboff-wrong-time-for-labors-negative-gearing-changes/news-story/cea8c3c8d09bc54b879b917113adfc18

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