Hi,
interesting article by ross gittens
http://www.smh.com.au/articles/2003/07/01/1056825394151.html
rossv
interesting article by ross gittens
http://www.smh.com.au/articles/2003/07/01/1056825394151.html
rossv
this is how the big boom ends!!
- Thread starter rossv
- Start date
Thanks for the link.
It's when you read the last paragraph of the article with references to "negative gearing loophole" and "halving the tax on capital gains" that you realise that how mistaken the article is.
The notion that "negative gearing" is a loophole has been dispelled so many times that I've lost count. See the letter in the AFR several days ago to rebut the "loophole" argument.
The article is not up to Ross's usual high standard.
Tony
It's when you read the last paragraph of the article with references to "negative gearing loophole" and "halving the tax on capital gains" that you realise that how mistaken the article is.
The notion that "negative gearing" is a loophole has been dispelled so many times that I've lost count. See the letter in the AFR several days ago to rebut the "loophole" argument.
The article is not up to Ross's usual high standard.
Tony
Originally posted by Jamie
Hmmmm ...
As usual, a financial commentator generalises the inner city apartment market in SYD/MEL to be representative of the housing market nationwide...
How surprising
Jamie
Actually, I dont think he extrapolated the Inner City Apartment Market out to the wider market at all. The entire article was only about Inner City Apartments.
The article was actually well written and made good points, blindly buying with the herd at the moment in Inner City Apartments would be crazy as it would be any time.
Dunc.
Yes, good article and the last paragraph is the best! It also amusing to see how widely “inner-city apartments” term used. Leave alone the representation of market nationwide, the inner-city in Melbourne is about 10km to the East or so, is there an oversupply? Please point me where the prices are falling. Inner-city CBD & Docklands high-rise apartments are rather different story to the inner-city Armadale/Hawthorn/Malvern low-rise apartments.
It also amusing to see how widely “inner-city apartments” term used. Leave alone the representation of market nationwide, the inner-city in Melbourne is about 10km to the East or so, is there an oversupply? Please point me where the prices are falling. Inner-city CBD & Docklands high-rise apartments are rather different story to the inner-city Armadale/Hawthorn/Malvern low-rise apartments.
G'day all,
And especially TonyC00
But then, this:- "halving the tax on capital gains"
Which was the Ralph review answer to doing away with the Capital Gains Index (I think that's what it was called).
How conveniently Messr. Gittins FORGOT to mention that this "halving" of the CGT was necessary in order to bring the "new" rules reasonably close to the OLD rules (CG Index).
In short, NOTHING to do with "creating" a property boom at all. If Ralph had never happened, the "old way" was so close to the "new way" as to have made no believable difference !!!!!
And, to put things in perspective, the "innercity apartments" scenario has had a major Achilles heel for MANY years (how many, I don't know.... maybe someone else does...) And that is the %age of overseas investors that are touted to purchase such investments. From figures I heard/read, nearly 50% of OTP inner-city apartments were purchased by OVERSEAS investors (who are prevented from buying 2nd-hand because of the FIRB!!)
So, they rush the only opportunity to purchase property in Australia, then, if they need to sell, they CAN'T SELL to other o'seas buyers (because the apartments are now SECOND-HAND !!!!!!!!!!!) so the number of eligible buyers instantly drops by HALF !!!!! What does THIS do to the supply/demand curve???
Is this a recipe for disaster, or what????? Enter, volatility !!! Or depression !!!!!!
In the words of the song "Give me a home amongst the gum trees, with lots of plum trees, etc...." Give me land, a home, and neighbours on the same level as you (and 40 metres away). None of this neighbours above, below, 5 metres away, etc.
Regards,
And especially TonyC00
My reaction to this article was "What a crock!!!" Agree with Tony's comment re "negative gearing" and the various attempts over the years to do away with it.
But then, this:- "halving the tax on capital gains"
Which was the Ralph review answer to doing away with the Capital Gains Index (I think that's what it was called).
How conveniently Messr. Gittins FORGOT to mention that this "halving" of the CGT was necessary in order to bring the "new" rules reasonably close to the OLD rules (CG Index).
In short, NOTHING to do with "creating" a property boom at all. If Ralph had never happened, the "old way" was so close to the "new way" as to have made no believable difference !!!!!
And, to put things in perspective, the "innercity apartments" scenario has had a major Achilles heel for MANY years (how many, I don't know.... maybe someone else does...) And that is the %age of overseas investors that are touted to purchase such investments. From figures I heard/read, nearly 50% of OTP inner-city apartments were purchased by OVERSEAS investors (who are prevented from buying 2nd-hand because of the FIRB!!)
So, they rush the only opportunity to purchase property in Australia, then, if they need to sell, they CAN'T SELL to other o'seas buyers (because the apartments are now SECOND-HAND !!!!!!!!!!!) so the number of eligible buyers instantly drops by HALF !!!!! What does THIS do to the supply/demand curve???
Is this a recipe for disaster, or what????? Enter, volatility !!! Or depression !!!!!!
In the words of the song "Give me a home amongst the gum trees, with lots of plum trees, etc...." Give me land, a home, and neighbours on the same level as you (and 40 metres away). None of this neighbours above, below, 5 metres away, etc.
Regards,
