With both major parties having outlined their policies on negative gearing and capital gains tax, it’s important not to lose sight of the bigger picture as the ‘war of the experts’ begins says First National Real Estate chief executive, Ray Ellis.
‘I’m reluctant to say that truth will be the first casualty but the debate already appears in danger of descending into claim and counter claim, following publication of The Grattan Institute’s report – Hot property: negative gearing and capital gains tax reform’ said Mr Ellis.
‘Both sides of politics will seize upon the various aspects of economic modeling put forward by The Grattan Institute and BIS Shrapnel. However, during this process, it is important that we don’t lose sight of the fundamentally positive effects of the current negative gearing and capital gains tax regime on the economy’. 
Current arrangements make buying a rental property an attractive method to build wealth and save for retirement for over two million ordinary Australians. These citizens are then better positioned to support themselves in retirement, reducing their reliance on government pensions.
The existing regime also contributes to a broad community benefit by underpinning the supply of affordable rental properties, reducing pressure on government to fund and build public housing.
‘While it has been claimed that the elite are the main beneficiaries of current negative gearing policy, many more average workers enjoy the benefits and contribute to the community in the process. These days, young people are also buying their first property as an investment instead of a home. Negative gearing is their way of getting a foot on the property ladder and managing the challenge of affordability. There would need to be a significant fall in house prices to offset the current policy that helps them get into the market’ said Mr Ellis.
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Issued by: First National Real Estate 
For further information contact: Stewart Bunn, National Communications Manager, First National Real Estate, on 1800 032 332 or 0413 624 317