Negative gearing battleground underpins election decision for voters
Abolishing the current negative gearing and capital gains rules could have a drastic impact on the property market, possibly flooding the market with property as investors transition to different financing models according to Sam Comer, senior manager of Tax Advisory for Crowe Horwath, part of Findex.
She said for property investors their election decision could largely be steered by the impact any new policy will have on their investments and retirement planning.
"With property usually being purchased with much higher leverage than shares, a change in the ruling would have the most drastic impact on the property market, which has always been a strong backbone of the Australian economy and investment main stake for mums and dads investors.," she said.
‘If we are seeing the negative gearing ruling changed, I anticipate a strong shift toward SMSF [self managed super fund] investing, taking the already strong trend to a massive migration. I don’t thing the full flow-on effect a new ruling would have has even been contemplated.
For those voters out there unsure of the potential impact their vote would have on their investment strategy, RateCity.com.au has released an Election Calculator.
According to statistics from RateCity’s Election Calculator, in NSW 5 percent of people under 80k, 12.3 percent(of total) plan to neg gear, 34.6 percent between 80-180k, 20.4 percent plan to neg gear, and 10.3 percent over 180k, 6.6 plan to neg gear. While in Victoria, 62.2 percent under 80k, 11.2 percent neg gear, 35.2 percent between 80 and 180, 18.8 percent to neg gear, 7.6 percent over 180k, 5.1 percent to neg gear, and in Queensland, 56.1 percent under 80k, 7.2 to neg gear, 35.3 percent between 80-180, 16.7 percent to neg gear, and 8.6 percent over 180, 5 percent to neg gear.
According to the data, RateCity claim Labor should be further ahead than it currently is depicted at in news polls.
Business owner and interest home buyer Michael said he was very surprised by the result – he has always been an avid Liberal voter, but discovered that Labor might be more beneficial for him from a financial perspective.
"I have voted Liberal all my life and hadn't thought much about how the way I voted impacted me financially. This is certainly something worth taking into consideration."
