Recently the Labor government has confirmed it will review negative gearing.
This is a policy which gives investors tax advantages, specifically allowing them to claim tax deductions for expenses relating to owning an investment property, explains Property Update.
Making it cheaper for investors to buy and hold rental properties is great if it contributes more rental stock to the market but not so great if it contributes to affordability challenges for home buyers.
“But any changes to negative gearing and capital gains tax policies could face further opposition – depending on how they are implemented,” reports Property Update.
“The crucial issue is whether the changes free up enough housing stock and make it more affordable for buyers and renters.”
So what are the proposed changes? Nothing yet. It’s still in the review stage.
But there have been calls to limit the number of investment properties an investor could negatively gear.
But any changes that may come of this latest review – if there are changes – would apply to future investment purchases, not anyone who is currently negatively geared, Property Update says.
Looking to invest? Talk to us about landlording or view our current listings for sale.