Exactly. Negative gearing only makes sense if the capital value...

  1. 161 Posts.
    Exactly. Negative gearing only makes sense if the capital value is increasing. Only an idiot would negatively gear while house prices are dropping. "I'd like to pay $1 so that i can get $0.30 back while also losing money on the house value thanks."

    Therefore changes to negative gearing won't cause a landslide in prices, but they will slow the eventual recovery.
 
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