Housing industry reacts to tax reform paper
The housing industry has reacted to Monday’s release of the Tax Discussion Paper by federal treasurer Joe Hockey. Among the key topics affecting the property market are negative gearing and capital gains tax. The founder of Aussie Home Loans John Symond was one of the first to react, saying that negative gearing should not apply to the luxury end of the market: “The intention of negative gearing when it was introduced was not to facilitate a $10 million- $20m house to rent out, get a 2 per cent yield and write the rest off on negative gearing,” Mr Symond told The Australian
. He suggests that capping the benefit would be better than scrapping it all together or it would risk damaging supply of housing for the broader market.
Meanwhile the Housing Industry Association’s Shane Goodwin has another tax in his sights: “Stamp duty on property conveyances is Australia’s most inefficient tax, and housing taxation reform can unlock substantial productivity gains and boost economic growth in the Australian economy.” The association has welcomed the release of the paper and the discussion that it facilitates.
The Real Estate Institute of Australia also welcomed the discussion paper but does not share John Symond’s view of negative gearing; president Neville Sanders commented: “We are pleased that the paper dispels common misunderstandings about negative gearing. The report states that ‘negative gearing does not in itself, cause a tax distortion’ and that ‘contrary to popular perception, negative gearing is not a specific tax concession for taxpayers with investment properties.’” He says that a review of taxation is essential and should include inefficient state taxes such as stamp duty.
Sources: The Australian, HIA, REIA
Aussies own their homes for at least a decade
In the capital cities the average Australian owns the same house for 10.5 years, according to research from CoreLogic RP Data. The figures were compiled using data from the last 12 months and show a large increase in ownership durations from 2005 when the average was 6.8 years. For units the average ownership is 8.7 years. Outside of the capitals the averages are only slightly lower. Regional differences are evident as ever with Sydney and Melbourne owners of houses holding on to them for 11.2 and 11.8 years respectively. Most of the other capitals have averages between 8.3 and 10.2 years with only Darwin falling below the average of ten years ago with owners selling in around 6.7 years.
Source: CoreLogic RP Data
Two properties smashed Sydney suburbs record at the weekend
A six bedroom home in Burwood and a three bedroom home in Marrickville smashed auction records at the weekend. The Burwood home sold for $4.725 million while the Marrickville record was set with a $2.4 million sale; it had been expected to go for around $1.5 million. Bidding was hot in many auctions on Saturday with more than $1 billion worth of homes sold.
Source: Inner West Courier
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