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Negative Gearing for housing is NOT the same as other business; Housing investors should be absolutely ashamed of themselves, your actions are unconscionable
Topic Started: 30 Sep 2014, 09:21 PM (772 Views)
Timo
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Negative Gearing for residential homes is NOT just like any other business operation. Period.
As widely known you don't get a 50% Capital Gains handshake when a business is sold, despite it having contributed much more to the economy and society then an unproductive speculative housing transaction.

Houses are where people LIVE their lives, it's where families are raised, milestones achieved, memories made and where people seek safety, privacy and comfort. Housing and businesses are chalk and cheese.

Policy which directly results in the exclusion of entire generations and multiple demographics of Australians from the entirely simple desire to put a roof over their head is arguably the most unconscionable Governmental sanctioned act occurring in Australian society.

The social and economic impact of this disgusting policy will be far reaching.

Anyone who engages in the use of Negative Gearing should be ashamed.
Edited by Timo, 30 Sep 2014, 09:45 PM.
After a bubble has burst, no one denies that it existed. But before it does, the popular refrain is that though bubbles existed elsewhere in the world, “there’s no bubble here”. So housing bubbles are admitted to have existed in Japan, the USA, Spain and Ireland – because they’ve already burst.
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Notch
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Small businesses get the 50% capital gains discount.
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herbie
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Notch
30 Sep 2014, 10:06 PM
Small businesses get the 50% capital gains discount.
A bloke said to me recently: "You'd be nuts to not have some sort of business; The tax breaks are simply too good!"
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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miw
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Notch
30 Sep 2014, 10:06 PM
Small businesses get the 50% capital gains discount.
In fact they are eligible for 100% capital gains discount if the business/asset is sold after you have owned it for at least 15 years and you are retiring. Small businesses are also allowed to roll over capital gains if the CGT event involves the replacement of an asset.

https://www.ato.gov.au/Individuals/Tax-return/2014/In-detail/Publications/Guide-to-capital-gains-tax-concessions-for-small-business-2013-14/
The truth will set you free. But first, it will piss you off.
--Gloria Steinem
AREPS™
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peter fraser
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herbie
30 Sep 2014, 10:13 PM
A bloke said to me recently: "You'd be nuts to not have some sort of business; The tax breaks are simply too good!"
A tax break only has value if the business is earning good money. Alas most business's underperform badly. So it's more of a case of winners doing well and losers doing poorly, and isn't that always the case?
Any expressed market opinion is my own and is not to be taken as financial advice
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Drgonzo
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I suspect there are those in government that realise negative gearing is a problem for the economy but they are fucked because they are so reliant upon the revenue associated with housing investment and property investors generally as a sizeable proportion of eligible voters.
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Gen Y Investor
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I don't deny getting rid of NG will become a game changer for RE in Australia, but it will primarily only start to put downward pressure on current properties with a lower yield. Removing NG by itself will not readjust the balance between incomes and current RE prices.

A house is only worth as much as someone is able and willing to pay. An example, houses in Sydney’s inner west: people on $100k were able to borrow $400k say 10 years ago, then $500k a few years later, then $600k a few years later, then $700k recently, then combine that with the banks' ability to lend even more to families on dual incomes and the fear of missing out on homes has pushed the very “average” 3 bedder there to $1+ million. Has it actually gone up in value to $1 million? — of course not, but it IS directly related to amount that people have been able to borrow. You can rent these out for $700 per week — but the "Australian Dream" of home ownership is still too much to justify reason for some!

The only thing to curb this is to impose further restrictions on the banking lending policies, which sadly will be unlikely to happen unless an external factor like China implodes or Europe (read about the deflation issue there currently).

What will be done? Probably nothing until the external factor, but if anything restrictions on foreign ownership, it is a safe bet for the government to rally the uneducated that this will solve the RE problems rather than tackling the many vested NG issue.
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Stan
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The small handful of countries who allow NG on investment properties have hella hot property markets, but surely it's just a coincidence :)
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peter fraser
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Stan
1 Oct 2014, 04:24 PM
The small handful of countries who allow NG on investment properties have hella hot property markets, but surely it's just a coincidence :)
Japan is a hot RE market - I didn't know that.

Any expressed market opinion is my own and is not to be taken as financial advice
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Stan
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peter fraser
1 Oct 2014, 05:32 PM
Japan is a hot RE market - I didn't know that.
That will teach me to make assumptions. I wasn't aware Japan had it as well.
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