SE says>>I am not sure I fully understand the point "rehctub" (butcher backwards?) is trying to make. However I would point out that the vast majority of properties bought by "negatively geared" investors are established dwellings, not new ones: ie, "negative gearing" does not do anything to increase the supply of new housing (and thus to reduce the housing shortage),

Well not quite true. The sellers of the 'old home' in most cases upgrade to a new home. Now if they buy another established home, then somewhere along the line, someone buys a new home.

Furthermore, are you trying to tell me that all of these rental units, being built in their tousands are for 'owner occupiers' and not investors. Yea, right!

The simple fact remains that if you take away the incentives for inestors to invest, then they stop investing. End result, an even worse housing shortage than we already have.