neg gearing is available to anyone, not just the rich. You can own a home if you try.

Our first home was a two bedroom unit in an industrial area, from there by careful budgeting we paid it off and moved houses and now own several properties. And no I don't work for the government, I am self employed working 80-100 hours a week, taking a risk every day, so I can become a self -funded retiree and not be a burden on society.

This "fairy tale" of a rich person buying their unborn grandchild a house, well good on them, they probably paid in GST, rates and income tax millions over the years.

As said many time over, if there is no incentive to buy residential housing (by tax deductions) very few homes would be built. The low rent charged now, is not enough incentive to have an investment property. So, rents would go up and more tradies would be unemployed.

The ones complaining about neg gearing, are just jealous that someone else has worked hard to get ahead in life. They would prefer the government pay for everything.

If the argument is about the "rich" not paying enough tax, then why don't commonwealth public servants pay tax? Think about what I just said, on paper you do, but the reality is you don't pay income tax as it doesn't increase tax revenue.

Tax churches and Mosques, if you really want to help Australia

Kirby483,

Negative gearing was all good and well once upon a time, but when it starts to create a permanent underclass with a sharp divide between the 'haves' and 'have nots', then everyone will pay to some degree or another, and not just financially. We all started out with two-bedroom fibro houses an hour and a half from the city. The problem now is that not even those are affordable to those looking to get a foot into the market.

It is a myth that the younger generations are all wanting to buy mansions ten minutes from the city.

Poirot, we will see the true end either way if labor wins and they get their policy across the line. My tip is they wont win, but hey stranger things have happened.

AJ, if we do take the PAYG investors out of the market, how do you think rents will be effected, especially given there will be fewer older homes to rent, taking into account they are usually cheaper to rent than new homes.

rehctub,

I'm certainly no economist, but those more qualified in this area don't seem to agree that winding negative gearing back a bit will push up rental prices.

http://www.abc.net.au/news/2015-05-06/hockey-negative-gearing/6431100

Dear Rehctub,

<<if you take away incentives to invest, people will stop investing>>

Then let them not invest, especially if as you say, they are there for tax-payer handouts rather than for making a good and honest living.

<<The reason behind the discounted CGT was to encourage the investor to sell the asset, so another could be built, this is the reason you have to reinvest in a similar sector within 12 months to retain the discount.>>

I didn't know it - that's terrible!

It's a good practice to keep your investment over the years, then pass it on to your children and grandchildren. Doing so you will care for it, plant trees and create a pleasant atmosphere around it.

Yet another reason to rid of this CGT discount.

<<as it was aimed at the housing shortage problem, the problem still exists and this change will be a backward step.>>

Hmmm. Along those lines, here's an even better solution: kill people, then the remaining ones will have ample housing.

AJ, when NG was introduced, interest rates were about mid to late teens, so Ng was a great tax break. Nowadays, rates are in the late 4's to early 5's, and given the interest is the only deductable part of the loan, as well as fees, lower rates mean lower subsidies from the tax payers.

Besides, most people can afford a home, they simply make lifestyle choices that take away that opportunity and of cause if you are talking about a $650K first home in Sydney, they need I say any more.

There are plenty of places areas around with housing from as little as $250K, even up to $450 K which is still affordable, but not along with maxed credit card repayments, plasmas and multiple internet gadgets. Not to mention $5 late's.

If a person can afford to rent, they can afford to buy. However, if they choose not to buy at 4%, they never will so whats the worry.