Property Is the Gift That Keeps On Giving

Property Is the Gift That Keeps On Giving

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When I keep thinking about the possible ramifications with Bill Shorten’s tax reform announcements I shake my head with utter disbelief – this is just plain dumb policy. Since the mining boom collapsed property has been a major shining light for the Australian economy. By announcing that from July 1, 2017 negative gearing will only apply to new properties, the argument that 93 per cent of negative gearing goes to existing properties is a flawed one. Many suburbs see very few new developments each year so it’s those existing properties that add equilibrium to keeping rents competitive.

It should also be noted that it was not mentioned that with the new properties that there would be no adjustments to the previous Labor policy in 2008 that permits 100 per cent of off – the – plan purchases to foreign owners. What we are seeing today is new developments being offered off shore and many properties never hit the local market with many of these properties being land banked. It should also be legislated that all off – the – plan foreign purchases must be rented out with all properties that are currently land banked to be issued with a divestment order unless they are rented out.

What I believe will happen with negative gearing is that we will see a cap put on the number of properties that are allowed to be claimed as well as a limit to annual tax deductions that can be claimed. In the meantime one could expect property investors to be front and centre in the markets prior to the upcoming Budget announcements.

HMASPenguin

SYDNEY AERIAL PHOTOGRAPHY

It is becoming pretty obvious that it will be some time before the Australian budget gets itself back in the black – more particularly now that an increase to the GST has been formally pooh – poohed.

Instead of looking at increasing taxes maybe the federal Government would be better suited to looking at what it can do with its massive property portfolio to pay down more debt. The Australian Government is the largest property landlord in Australia with property holdings across the country.

HMAS Penguin for example which occupies some prime Middle Harbour front land is just one of thousands of examples of land that could be put to much better economic use. Now before you start yelling and screaming all I am saying is that the federal Government should be taking a closer look at its property portfolio with a view to possibly cashing – in. The NSW Government has been active over the past few years selling off Housing Commission properties that has eventuated in quadrupling budget expectations on the likely market values.

Australia’s population hit 24,000,000 this week so it makes plenty of sense to start a conversation on how our cities are going to cope with this rapid expansion. Public golf courses will come under huge pressure to remain with their respective land values going through the roof. Although before we see those being developed the federal Government has thousands and thousands of hectares of vacant land sitting idle.

No doubt some will say it’s time to put Australia’s land resources to better and more practical use and many will say it should remain as it is. One would have to admit that it would be an interesting debate. The Australian population clock now adds one extra person to our population every one minute and 31 seconds. On top of that we also have record net overseas migration. Our population growth is now higher than that of Indonesia.

The reality is that we need to start developing more land, so that conversation should start with Australia’s biggest landlord.

No time like the present to start this long overdue conversation.

MOSMAN – 2088

• Number of houses on the market this time last year – 79

• Number of houses on the market last week – 53

• Number of houses on the market this week – 59

• Number of apartments on the market this time last year – 52

• Number of apartments on the market last week – 46
• Number of apartments on the market this week – 44

CREMORNE – 2090

• Number of houses on the market this time last year – 8

• Number of houses on the market last week – 17

• Number of houses on the market this week – 18

• Number of apartments on the market this time last year – 19

• Number of apartments on the market last week – 17

• Number of apartments on the market this week – 22

NEUTRAL BAY – 2089

• Number of houses on the market this time last year – 5

• Number of houses on the market last week – 9

•Number of houses on the market this week – 7

• Number of apartments on the market this time last year– 38

• Number of apartments on the market last week – 27

*Number of apartments on the market this week – 28

For this week’s sales in Cremorne real estate, Cremorne Point real estate, Mosman real estate, Beauty Point real estate, Clifton Gardens real estate, Balmoral real estate, Neutral Bay real estate, Cammeray real estate.

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Source: APM Price Finder

2 Responses to “Property Is the Gift That Keeps On Giving”

  • Peter maccormick says:

    Liked the article however selling off land at middle head is a NO NO It’s a national park

  • Ann says:

    Robert, the roads here cannot handle the load of what you suggest, and they don’t spend any money on roads unless its a marginal electorate. Look what marginal seats get in terms of roads, sporting facilities, schools, kindy’s, disabled facilities, and the rest.

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