I have a vague recollection that many years ago a government removed
offsetting interest payments on an investment property against other
income. The result was many rental properties went up for sale and
tennants were asked to leave.
Rents got so high the government had to remove that legislation.

There is a high amount of churn of property investors because the risks are high, the returns low and there is constant regulation change.

It is aspirational mum and dad investors who prop up the rental market. Most are sold into it by clever hard-sell scams of the white shoe brigade.

It is foolish to believe that the constant government shedding of its responsibility for welfare housing to private investors (read as mums and dads who know precious little about investment) and the regular re-jigging for more State control of rental housing without accountability will not some day result in a run by investors away from rental housing. The only surprise is that it hasn't happened already. Next time the small investors who provide the lion's share of housing and make considerable sacrifices to their own quality of life for the pleasure, might run and never come back.

my only investment property was a poor choice. It started by the would be Government homes tennant wrecking it. The cost and chances of recovery made it not worthwhile to pursue. For ten years now I have been providing cheap rent to another low income tennant. Though the property is negative geared I will still have made zilch from it. What puzzles me is the fact that if negative gearing was stopped thousands of people would be out of homes. The Government can't afford to house the ever growing numbers of generational unemployed and low income workers. No doubt their are those who have cashed in on the short term I suspect many negative gearers are simply everyday people to society a favour.

It's the standard pollie-speak, pea-and-thimble trick in operation here, Hasbeen.

>>Hay Phil, tell me more about this $45 billion tax benefit extended to owner occupiers. I've been one of them for years & never seen a cent. Where do I apply?<<

This is how that $45 billion "benefit" is calculated:

"$29.8 billion from the capital gains exemption of the family home".

Pure Alice-in-Wonderland logic.

Applying capital gains tax to sale of the family home would be a singular iniquity, so passing off exemption from it as a benefit is simply mendacious.

"$6.9b from the non-taxation of imputed rent"

Ah. More public-servant logic.

I don't earn any rent on my owner-occupied property, so I am permitted the indulgence of not being taxed on the rent that I don't receive. Classic.

"$4.8b from the exemption of imputed rent from the GST"

Even better. I am permitted not to pay GST on the rent that I don't get. Gee, thanks guys.

"$3.5b in exemption from state-based land taxes"

Yet another "exemption" from a tax that, in the context of an owner-occupied house, should not even be contemplated.

There you have it. $45b in "indirect assistance to owner-occupiers", every dollar of which is pure illusion, and doesn't actually require the taxpayer to put his hand in his pocket for one single zac.

Staggering.

Negative gearing is on par with investment so far as the evil nature of greed is concerned.
A handful rake in what should be distributed to stimulate the economy.

"A handful rake in what should be distributed to stimulate the economy"

That wouldn't be the mums and dads investors in residential real estate.

You only have to go along to a meeting of any of the property owners associations to find out the obvious, that the people attending are very ordinary, dressed no better than shoppers at an IGA in a cheaper suburb. Their cars parked outside are Korean four bangers and years past new.

These are the eternally optimistic, aspirational low income earners who do not have the wherewithal to take advantage of the advice and options available to salaried professionals and the like. They distrust other investment options, mainly due to lack of familiarity and a need to see their actual investment in front of them.

While it may be that the astute who live by their wits might occasionally make money from residential real estate, they are very few in number, take very high risks and have no inclination to hold property to lease out as a business.

Who then 'rakes in' $$ from property? Too easy for any who are interested in facts and have maths at secondary school level: it is YOUR government. All layers of government see property as a milch cow for taxes. As well, all layers of government are continually dabbling in policy affecting land development and housing. All levels of government are forever trying to pass their responsibilities for welfare housing to private owners. The results of the fiddling is always disruption and a costly shambles.

Government decisions in other areas as well, a prime example being the decades of record breaking migrant numbers for a 'Big Australia', have overstretched infrastructure and led to even higher taxes on property.

If we want to talk about what drives up rents, look no further than government policy and government taxes. Those mythical well-off landlords simply don't exist, except in the feverish imaginings of rusted-on Marxist dinosaurs and governments who regularly return to snip just a few dollars more from the very ordinary and likely very foolish mums and dads 'investors' in housing.