The NSW state government has just announced that they're putting a 2.2% tax on investment properties and removing the stamp duty for first home buying. Yay. We should have a celebration party. Fooey on those stupid speculators, and three cheers for poor families saving for mortgage deposits.
What's super tops, all those silly investors are going to sell to owner-occupiers. They know their houses aren't going to go up in value any more, and suddenly owner-occupiers are going to be receiving a huge discount relative to the investors. So lots of property is going to change hands, and the state's wealth will be distributed a little bit more happily. Good stuff.
Although what was kind of cool - because investors had paid so much more for houses than they were really worth, rents didn't really go up in time with prices. So the silly investors were paying huge interest rates, but only getting a tiny bit back of it in rent. Any investor who bought in the last year or so and can't sell the house straight away, is going to get burned. Because they're not going to recover their costs in rent. Have I said that they're silly bumheads? Oh yes. I have already.
That post turned out longer than it was meant to. But I'm just so happy about it. Yay.
Is it only good 4 ppl who rent – or ppl who own there house, wat abt the ppl who got a property some where – who didnt buy it last 2 yr , but erlier then that.
why u happy – probably if u look at it – u will 1 day maybe hv 2 buy a house, so it wont effect u & every1 else then as well.
SORRY if that all sounded rude !! – i’ll stop talking now.
Anmol / 10:08am / 7 April 2004
What about the people who are stuck inbetween? Like the owner-occupier that I know who has recently moved from Brisbane to Townsville for work and is now having trouble renting or selling her place in Brisbane, but has to get a place up here too?
Rainman / 11:01am / 7 April 2004
Stop being so bloody insensitive, Ryan.
Tom / 11:09am / 7 April 2004
I don’t understand. How is it good for people who rent? I reckon rents might be better off in a bubble, because supply of rental properties increases (because everyone is building) without demand increasing.
And it’s not going to directly affect people who only own one house. It will help first home buyers (who have done badly out of the bubble), and hurt investors (who have done far too well out of the bubble). Why is your friend having trouble selling it? How does this investment tax make it hard for her to buy a new place?
I’m totally missing the point, or did I just explain what’s happened really badly?
Ryan / 6:00pm / 7 April 2004
Won’t it be bad for renters because the slutty investment property owners want to be rich, so they’ll put up rent to cover the new taxes even though it’s being slutty?
If that’s true, presumably it won’t affect existing renting properties as much, because while land taxes increase their owners still don’t get slugged with a massive tax when they first acquire the thing.
Anyway, I’d just like to send big ups to all the non-negative-gearers out there who just want a cool house to live in. Or something
Andy / 12:29am / 8 April 2004
I don’t think that will really happen. Supply hasn’t changed, and rents haven’t gone up nearly as fast as prices have. If rents had gone up and they expected them to go up further, then I don’t think you’d call it a bubble, because property would be priced at the level people pay to live in something. It’s a bubble when things are being bought purely out of the hopes of capital gains. Which are being driven by speculator activity, not occupier demand.
Renters might be hurt because there aren’t so many desperate investors needing to rent their properties between sales. But I don’t think they’ll be any worse off than they would have been if there’d been no price bubble in the first place.
Ryan / 7:24am / 8 April 2004
I agree with Ryan, Andy, about the renters. The rental market seems very demand driven [I speak only from being one of those slutty landlords – no other knowledge] so even if you want to increase your rental charge to cover the land tax costs, or the potentially increased price of purchasing now that stamp duty is on both ends of the sale, if tenants don’t want to pay that price, tough!
Janet / 6:35pm / 8 April 2004