If that was what they believed then why did they re introduce so...

  1. 18,390 Posts.
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    If that was what they believed then why did they re introduce so quickly?
    New housing won't help as investors do not want to purchase new builds in areas that are not where the renters want to live. How many new builds in established suburbs? Most are in the outer areas.
    Existing buildings as rental properties provides grandfather protection for existing property holders. However more renters are coming into the market than properties available so where will the new properties come from for these renters? New builds won't do it.
    I can't see any good reason not to allow it? It is in the market atm and housing prices have fallen so negative gearing cannot be to blame for inflated housing prices. Recent investors will be bleeding atm. Many have negative equity and as there fixed interest loans expire can't get further finance due to tightening of lending and banks lending against a potential rate of 7% interest. ie if you don't have the equity and can't afford the repayments at 7% interest they won't lend. A perfect storm brewing. New building in WA has ground to a halt and housing prices started to recover however that will be short lived. No one wants to see their asset go down in value yet it has happened before and will happen again even though negative gearing exists.
    There is no good reason not to maintain negative gearing as far as I am concerned.
    I have only ever had one negatively geared property and that was actually a brand new purchase. Took 11 years to get my money back so this form of investing doesn't suit me but I still believe that if you want to take the capital risk then claiming on running losses should be allowed. I had tenants do runners, no pets ignored as a dog chewed up the reticulation and had to flea bomb the who house due to cats being kept. I am no fan of property investing however to those that do it and make a buck I say good luck to them. It isn't a fool proof low risk investment.
 
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