Negative gearing to go?

[Bystander]

"THE Gillard government has sounded out unions over steps to cool Australia's housing market'

any colder and it would be frozen! they risk tipping the market into freefall

haha, yes, freefall back to sensible prices in line with wages and salaries -- just as every other asset bubble in history has popped, this one too must pop.

why do you think lending is at an all time low right now? why do you think land sales are at an all time low right now? because the product is priced too high for the average purchaser. Economics 101 tells us the price will have to come down if you want to sell your commodity.

 

[Bystander]

I see myself as trying to build a portfolio through long term CG that will increase the likelihood of being able to fund my own retirement. I subsidise my tenants & use the tax system available to ALL business ventures to reduce my out of pocket expenses. You consider that this makes me a parasite; and you are on a PI forum. Which is why i think this does have a good chance of getting up.

How can you 'subsidise your tenant' and still make a profit if you are paying interest and principal on a full mortgage?

If landlords like you WEREN'T pushing up the price of property in various areas by outbidding owner-occupiers, perhaps they would be cheaper in the market. And you NEED the tenant, let's face it, you need them more than they need you. But I still can't see how you will make a profit unless you are speculating on capital gains higher than inflation and the losses you are bearing -- which is looking extremely unlikely at present, with property bubbles around the world imploding as we speak.

 

[Bystander]

I'm not worried, I'm just overwhelmed with a desire to take a run up and slap some of these politicians. And they presume to lead me. "lead". ha!

yeah, lead, hah. why not just keep on handing out that middle class welfare to you and keep you happy, what are they thinking? next thing they will be going in to bat for the battlers or something...

 

[Bystander]

Gillard needs the boot. Instead of trying to choke demand by targetting investors, perhaps she should focus on reindustrialising Australia so that we aren't a glorified quarry that sends its raw materials overseas rather than process them here. I daresay that if people had better paying jobs, then those seemingly unnaffordable houses might be affordable.

Maybe YOU could be working on investing in productive industries instead of passive exploitative investment in bricks and mortar and someone else's income too then? Instead of just whinging about how little the govt is doing. How many software startups have you invested in inside Australia so far?

But your solution is to print more money and pay everyone more, rather than see house prices adjust back in line with today's wages and salaries? Very curious.

 

[Bystander]

The tax, if it ever came in, would probably just be on new purchases.

Can't see any of the big wigs voting these ideas in any time soon, they will all be affected.

No, it would be on any annual loss claims going forward for anyone. Not just new purchases. Unlikely to have any grandfathering provisions.

 

[Ausprop]

How can you 'subsidise your tenant' and still make a profit if you are paying interest and principal on a full mortgage?

where did the poster state they were making a profit? a loss is a loss is a loss

what does the repayment of principal have to do with anything?

 

[Ausprop]

If landlords like you WEREN'T pushing up the price of property in various areas by outbidding owner-occupiers, perhaps they would be cheaper in the market. And you NEED the tenant, let's face it, you need them more than they need you. But I still can't see how you will make a profit unless you are speculating on capital gains higher than inflation and the losses you are bearing -- which is looking extremely unlikely at present, with property bubbles around the world imploding as we speak.

Debt deflation is the key, dependant on the cashflow gap

 

[skater]

I see we have another troll, hell-bent on showing us the error of our ways.

 

[Bargain Hunter]

yeah, lead, hah. why not just keep on handing out that middle class welfare to you and keep you happy, what are they thinking? next thing they will be going in to bat for the battlers or something...

Who are these said battlers. The dole bludgers who contribute nothing to society, that leech off all members of society, who do nothing to improve their own lot yet decry any and all measures to make them accountable for their actions. Are these the battlers you so eagerly raise the flag of socialism over?

To have a battler you must first have a battle. And the first battle to be fought is that against self deceit and ignorance. Clearly your name betrays you, and you are yet to face your first battle.

Regards

Andrew

 

[Belbo]

Your misguided ingorance is almost quaint, Bystander, and genuinely amusing on a forum populated by such sophisticated economic thinkers as this one is. Please don't stop. I love it!

 

[Token Funder]

Who are these said battlers. The dole bludgers who contribute nothing to society, that leech off all members of society, who do nothing to improve their own lot yet decry any and all measures to make them accountable for their actions. Are these the battlers you so eagerly raise the flag of socialism over?

To have a battler you must first have a battle. And the first battle to be fought is that against self deceit and ignorance. Clearly your name betrays you, and you are yet to face your first battle.

Regards

Andrew

Buying an investment property is an economic decision and need not require the contribution of other taxpayers for it to make sense. Removing ng going forward will simply change the economics such that the underlying yield will be rational or the investor will voluntarily elect to carry the cash-flow looses until they realise their capita....justl like a grown-up.

The world won't end.

 

[Bystander]

Who are these said battlers. The dole bludgers who contribute nothing to society, that leech off all members of society, who do nothing to improve their own lot yet decry any and all measures to make them accountable for their actions. Are these the battlers you so eagerly raise the flag of socialism over?

To have a battler you must first have a battle. And the first battle to be fought is that against self deceit and ignorance. Clearly your name betrays you, and you are yet to face your first battle.

Regards

Andrew

the dole bludgers would be in public housing, so you're not getting their money. most of them are 'dole bludging' due to the fact that demand from employers is lower than the number of people looking.

then there's the high youth unemployment rate for the same reason, although most of them are living at home.

the money they get at least flows straight back into the economy as they spend a miserable $10K a year on food and clothing. Australia has the lowest unemployment benefit anywhere in the OECD, by the way.

I find it hilarious that you leech off tenants and your employer for doing no useful or productive work, when someone else (a battler on low pay) can't bend the system to their advantage then they're a bludger.

there's always a huge deficiency of actual facts on this speculators' paradise website, I notice.

 

[Bystander]

where did the poster state they were making a profit? a loss is a loss is a loss

what does the repayment of principal have to do with anything?

it will be a bigger loss once the ALP phase out negative gearing on everything by degrees.

you are living in this delusional world of thinking you can carry a loan forever without repaying the principal, and believe inflation will outstrip the debt. I wonder if you've ever modelled real numbers in your scenarios. The price rises of the past 15 years have been solely due to increased credit, you're now facing a credit squeeze. It's the end of the tulip boom, my friend, and all the deluded speculators are about to take a bath.

 

[Belbo]

Looks like we've got a first year uni economics student here practicing rhetoric for making a bid at getting onto the student council. Sweet.

 

[Rixter]

If landlords like you WEREN'T pushing up the price of property in various areas by outbidding owner-occupiers, perhaps they would be cheaper in the market.

Have you any idea the low number of residential property investors to owner occupied purchasers in Australia?

 

[INVSTOR]

Talks test the water on negative gearing change


Read more: http://www.smh.com.au/national/talk...ring-change-20110420-1doxq.html#ixzz1K6OPzkRX

[/SIZE]

I wonder where the NRAS Scheme fits in with all this talk?

 

[skater]

the dole bludgers would be in public housing, so you're not getting their money. most of them are 'dole bludging' due to the fact that demand from employers is lower than the number of people looking.

then there's the high youth unemployment rate for the same reason, although most of them are living at home.

What's that? Public Housing you say? You have got to be kidding! Let me tell you there is nowhere near the amount of housing that is required to house those, shall we say, unable to support themselves.

There is currently a five year wait for this fallacy of Public Housing. Do think the Government is really going to suddenly supply more Public Housing to house all these people? Of course not!

So, those long term unemployed are just sitting around doing nothing because there is no demand from employers? Give me a break! And the youth, who since they have it comfy at home with their parents just go on endless benders and let their parents support them until the parents finally give up and force them either out of the nest or into the workforce. Don't tell me it doesn't happen, cause I personally know many that have done this.

I wish this country would get rid of many of the middle class welfare that they hand out to almost all of the population. We need welfare for the needy (the old, frail, handicapped, etc), but not for the greedy (those who can't be bothered working, or have kids with multiple partners, or even the working getting additional funds to pay for their kids).

And for the record, I don't give a brass razzoo if they get rid of neg gearing. My portfolio is well & truely cashflow positive, so it really won't effect me at all in the way that you hope.

If the Government do this, yes, some investors will sell up. Don't for a minute think this is a good thing for renters. Less investors means less properties available for rent, especially in the inner suburbs, where the biggest losses can be found. This means that there will be a lot more demand for properties than there is available, pushing rents up. It also means that more and more renters will have to move to the outer suburbs due to affordability.

So, think for a moment how this will affect your "battlers". I can't wait! I've been pushing up my rents consistently for the last few years. I'm up over $100pw for each property, and they are still not stopping. Do this and the rises will keep on going, which means that I can buy more property (remember I'm NOT neg geared, so I CAN buy quite a bit and still not go neg) and retire earlier.

 

[pieman]

Dont take the bait skater

 

[Bargain Hunter]

Buying an investment property is an economic decision and need not require the contribution of other taxpayers for it to make sense. Removing ng going forward will simply change the economics such that the underlying yield will be rational or the investor will voluntarily elect to carry the cash-flow looses until they realise their capita....justl like a grown-up.

The world won't end.

I don't have a hell of alot of -ve gearing so it has little direct impact on me however again to say that a major change to the way an asset class is treated by the ATO and at the same time claim that nothing will change in the market is not logical.

The sun will rise and set tomorrow and I will continue to invest in property as long as the numbers stack up. Whether the numbers stack up for the majority of investors is yet to be determined.

Regards

Andrew

 

[skater]

Dont take the bait skater

Oh, don't worry. I know he's just a dumb-a#$d troll, but maybe, just maybe, he might learn something. Stranger things have happened. In fact, I can't remember the name now, there was another poster some years ago that kept repeating a heap of crazy ideas about how we investors were the scum of the earth. This person stayed around and eventually caught on, through the perserverance of a few posters continually giving them feedback. From memory I think he even bought an IP.