Society/Culture Australian Property Prices to Crash?

[Taylor]

You are not understanding.

Rich people en masse would not be buying poor Peoples homes if they did not get tax benefits to do so.

Tax benefits fuel housing growth. Without them housing doesn’t grow as fast thus there is much less benefit for someone to buy them.

They are 2 different issues.

Investment loans are already much higher than OO loans. As long as you can claim a loss on property people will use it.

You need to look at it as a preservation of wealth strategy. Property is worth one property worth of whatever the figure ends up being post rampant inflation cycle.

You need only look at the strategy of blackrock buying so much residential property. It's treating it as a lifeboat for wealth.

This isn't something anyone who will be impacted created, they will just pay the bill for it when the wealthy park their money into property to ride out inflation and the poor will never get a chance to own it again.

I'm not expecting the real value of property to change, it might even go down, but the value as a measure of ability to pay for it will be through the roof. Wage growth won't keep up with the actual cost of living increases because the CPI is distorted by basket substitutions. The ability to pay people more will diminish when there is less surplus funds in people pockets after fuel, housing and food to spend on non critical "luxuries" like entertainment.

 

[Deliverance]

When are they going to return to .25 multiples

Oh well, at least RBA has made a clear admission that they are well behind the curve.

I want them to do something weird, like 0.33

 

[Madas]

The rich aren't paying more with this rate rise, just the regular poor people who didn't get the benefit of the cash injected into the market.

Now the rich will also swoop in to pick up the poorer peoples assets at discount prices greater than other poor can afford and the nightmare gets worse.

The interest rates pushing people out of their homes ad everything in life gets more expensive isn't hitting the big end of town.

“The rich get richer
The poor get the picture
The bombs never hit you when you're down so low”

 

[Suspense]

Locking in last year at 1.99% fixed-rate until mid 2025 was money for jam.

 

[Suspense]

You are not understanding.

Rich people en masse would not be buying poor Peoples homes if they did not get tax benefits to do so.

Tax benefits fuel housing growth. Without them housing doesn’t grow as fast thus there is much less benefit for someone to buy them.

They are 2 different issues.

Investment loans are already much higher than OO loans. As long as you can claim a loss on property people will use it.

Negative gearing is a middle class mom and pop tax minimisation strategy - not really the domain of the rich. The rich usually come from inherited wealth - many who still surprisingly have access to pre-CGT assets - sell a property for $3m and pay $0 tax.

In my experience, even younger HNWIs rarely bother with negative gearing - they usually earn business or investment income (not salary and wages) - and so are able to utilise a whole range of other tax minimisation strategies - which wage slaves cannot access (hence the popularity of negative gearing for middle class types).

 

[HirdsTheWord]

Negative gearing is a middle class mom and pop tax minimisation strategy - not really the domain of the rich. The rich usually come from inherited wealth - many who still surprisingly have access to pre-CGT assets - sell a property for $3m and pay $0 tax.

In my experience, even younger HNWIs rarely bother with negative gearing - they usually earn business or investment income (not salary and wages) - and so are able to utilise a whole range of other tax minimisation strategies - which wage slaves cannot access (hence the popularity of negative gearing for middle class types).

No, it isn't.

The people who benefit from negative gearing are generally in the top 25% of income earners.

https://australiainstitute.org.au/wp-content/uploads/2020/12/Who-really-benefits-from-negative-gearing_0.pdf

 

[FRUMPY]

No, it isn't.

The people who use negative gearing are the top 25% of income earners.

just another side brag.....'The people who use negative gearing are the top 25% of income earners - an i am one of them'

look at me, look at me, look at me......

 

[HirdsTheWord]

just another side brag.....'The people who use negative gearing are the top 25% of income earners - an i am one of them'

look at me, look at me, look at me......

how is stating a fact bragging? rofl.

 

[FRUMPY]

how is stating a fact bragging? rofl.

you sit on this thread complaining about the rules but then brag each time about how much assets and money you have - you're just a w***er who is part of your own so called problem that needs fixing......getting tiresome hearing you complain about how much money/assets you have and wont sell the property to people looking for a house at a decent price.....

you just sit here talking rubbish - if you really cared as much about the issue as you say you do then you would sell your property to someone looking to buy a house for half the price you could sell it for......but we know you are only in it for the money.

 

[HirdsTheWord]

you sit on this thread complaining about the rules but then brag each time about how much assets and money you have - you're just a w***er who is part of your own so called problem that needs fixing......getting tiresome hearing you complain about how much money/assets you have and wont sell the property to people looking for a house at a decent price.....

you just sit here talking rubbish - if you really cared as much about the issue as you say you do then you would sell your property to someone looking to buy a house for half the price you could sell it for......but we know you are only in it for the money.

lol i never bragged about a thing, the only time i talk about my personal situation is when someone (like you) brings it up.

I was asked once in this thread what my situation is. I was open and honest that I have a high household income and i negatively gear a property. I have also been open with the fact that it is complete bullshit that i am allowed to do it, at my income level. You have mistaken fact for bragging. Unsurprising considering your posting quality.

I have no issues admitting i take the piss out of a system geared to favor high income households. I'd be financially illiterate not too. Me alone stopping will not change the system as a whole, if it did i'd sell my investment property tomorrow. Government Legislation and Policy will of which I would support as a high income household.

What your problem is, is jealously thus you reading into a fact as a brag. I am unfazed at what you think is tiresome because frankly you don't add anything to the discussion except taking personal shots, because as a low IQ poster, that's all you can do.

 

[HirdsTheWord]

You need to look at it as a preservation of wealth strategy. Property is worth one property worth of whatever the figure ends up being post rampant inflation cycle.

You need only look at the strategy of blackrock buying so much residential property. It's treating it as a lifeboat for wealth.

This isn't something anyone who will be impacted created, they will just pay the bill for it when the wealthy park their money into property to ride out inflation and the poor will never get a chance to own it again.

I'm not expecting the real value of property to change, it might even go down, but the value as a measure of ability to pay for it will be through the roof. Wage growth won't keep up with the actual cost of living increases because the CPI is distorted by basket substitutions. The ability to pay people more will diminish when there is less surplus funds in people pockets after fuel, housing and food to spend on non critical "luxuries" like entertainment.

Companies buying residential property is relatively only a new thing, AND it only really started as interest rates plummeted, as interest rates go up (especially the forecasted long term rates cycle we see now) wholesale purchases of residential property is less attractive as companies taking them out are all of a sudden paying massive amounts more of interest payments, as well as banks will see them as more high risk investments thus limiting lending.

Go watch below. Very interesting talk about what have said about BlackRock and other Financial Companies buying mass amounts of housing in the states.



if you wanted to park cash during inflation things like, OIL, gold etc are much better safe havens than property. only an idiot would park money in housing for inflation, unless they are willing and able to wait multiple years to get their money back.

 

[FRUMPY]

lol i never bragged about a thing, the only time i talk about my personal situation is when someone (like you) brings it up.

I was asked once in this thread what my situation is. I was open and honest that I have a high household income and i negatively gear a property. I have also been open with the fact that it is complete bullshit that i am allowed to do it, at my income level. You have mistaken fact for bragging. Unsurprising considering your posting quality.

I have no issues admitting i take the piss out of a system geared to favor high income households. I'd be financially illiterate not too. Me alone stopping will not change the system as a whole, if it did i'd sell my investment property tomorrow. Government Legislation and Policy will of which I would support as a high income household.

What your problem is, is jealously thus you reading into a fact as a brag. I am unfazed at what you think is tiresome because frankly you don't add anything to the discussion except taking personal shots, because as a low IQ poster, that's all you can do.

so you are just part of what you claim to be the problem.....

and jealous - no not at all. ive got no issue with investment properties and people who do it. Secondly, in regard to property prices, there are plenty of houses/packages out there that are affordable for most people wanting to buy a home

 

[Gigantic]

Negative gearing is a middle class mom and pop tax minimisation strategy - not really the domain of the rich. The rich usually come from inherited wealth - many who still surprisingly have access to pre-CGT assets - sell a property for $3m and pay $0 tax.

In my experience, even younger HNWIs rarely bother with negative gearing - they usually earn business or investment income (not salary and wages) - and so are able to utilise a whole range of other tax minimisation strategies - which wage slaves cannot access (hence the popularity of negative gearing for middle class types).

It may have the perception to be a mum and dad tax minimisation strategy but its design and effect really isn't.

1/4 of all property investors who are negatively geared get no net benefit from negative gearing because they simply don't have a large enough tax liability for the deductions to make sense.

The tax benefit on an average property for someone earning the median salary is going to be minuscule. Compared to someone on >$180k with multiple negatively geared properties.

 

[HirdsTheWord]

so you are just part of what you claim to be the problem.....

and jealous - no not at all. ive got no issue with investment properties and people who do it. Secondly, in regard to property prices, there are plenty of houses/packages out there that are affordable for most people wanting to buy a home

yes, of course i am part of the problem, and I'm certainly not bragging about it, i didn't even mention my situation before you brought it up this morning. But it is not my job to fix it, my job is to ensure my family has the best possible life within the laws of the country. All I can do is say i would support the removal of my tax benefits, i didn't say i am a beacon of morality. If you think me selling my property would change the system , than great ill sell mine tomorrow, but we both know this is a cheap line by you, an uneducated one at that.

You have a different opinion to me, whatever, that's great. But you are the one on here making personal attacks calling me a w***er and such. Why? because i believe high income earners like me should not be able to claim a tax benefit to buy additional housing?. Pull the other one mate. You are 100% jealous whether you claim it or not.

There are plenty of housing packages 1.5 hours commute each away from CBD's that's great. I don't believe this should be the only option for people to buy a house when the benefiters of tax investments are typically already wealthy people.

You don't like my stance, great. Lets discuss it rather than you acting like a *******.

 

[Taylor]

Companies buying residential property is relatively only a new thing, AND it only really started as interest rates plummeted, as interest rates go up (especially the forecasted long term rates cycle we see now) wholesale purchases of residential property is less attractive as companies taking them out are all of a sudden paying massive amounts more of interest payments, as well as banks will see them as more high risk investments thus limiting lending.

Go watch below. Very interesting talk about what have said about BlackRock and other Financial Companies buying mass amounts of housing in the states.



if you wanted to park cash during inflation things like, OIL, gold etc are much better safe havens than property. only an idiot would park money in housing for inflation, unless they are willing and able to wait multiple years to get their money back.

They started investing when the world pushed out more money than ever before, by orders of magnitude, and shut down supply chains.

But I'm sure those trillions of dollars are managed by idiots, that's who society works after all - idiots are pushed to succeed while smart people complain that the system is unfair and don't listen when someone tells them the chiseled in granite truth about what is about to happen.

Gold and oil backed currency? No. Land backed. The wealthiest people in the world are buying up bulk land for a reason.

 

[Madas]

yes, of course i am part of the problem, and I'm certainly not bragging about it, i didn't even mention my situation before you brought it up this morning. But it is not my job to fix it, my job is to ensure my family has the best possible life within the laws of the country. All I can do is say i would support the removal of my tax benefits, i didn't say i am a beacon of morality. If you think me selling my property would change the system , than great ill sell mine tomorrow, but we both know this is a cheap line by you, an uneducated one at that.

You have a different opinion to me, whatever, that's great. But you are the one on here making personal attacks calling me a w***er and such. Why? because i believe high income earners like me should not be able to claim a tax benefit to buy additional housing?. Pull the other one mate. You are 100% jealous whether you claim it or not.

There are plenty of housing packages 1.5 hours commute each away from CBD's that's great. I don't believe this should be the only option for people to buy a house when the benefiters of tax investments are typically already wealthy people.

You don't like my stance, great. Lets discuss it rather than you acting like a *******.

Nah I agree with Frumpy
You gotta walk the talk mate
Think global act local

eg :
I hate plastic bags and litter , therefore don’t use them and pick up others .
I Don’t just walk around saying “ everyone else is doing it “

 

[Taylor]

I think the only issue with what HirdsTheWord is saying is that he is pulling the ladder up after he has climbed it, everyone should absolutely look after themselves and their own within the laws of the country. It's perfectly valid to identify a problem with an advantage you've enjoyed and suggest it should be changed to make it more fair.

 

[Madas]

I think the only issue with what HirdsTheWord is saying is that he is pulling the ladder up after he has climbed it, everyone should absolutely look after themselves and their own within the laws of the country. It's perfectly valid to identify a problem with an advantage you've enjoyed and suggest it should be changed to make it more fair.

Yeh na
If you strongly believe something is wrong it’s nonsensical to partake in that act as it just perpetuates the problem

Even if it doesn’t change the world you know you are doing the right thing by your own standards

 

[HirdsTheWord]

Yeh na
If you strongly believe something is wrong it’s nonsensical to partake in that act as it just perpetuates the problem

Even if it doesn’t change the world you know you are doing the right thing by your own standards

Yeh na
If you strongly believe something is wrong it’s nonsensical to partake in that act as it just perpetuates the problem

Even if it doesn’t change the world you know you are doing the right thing by your own standards

I am not financially illiterate. I will take whatever tax breaks I’m allowed too. Doesn’t mean I think they are right.

Would be more nonsensical to fall behind financially when others are not living by the same standards. It’s the governments job to do the right thing for the population, not mine. I’m just identifying the issue and saying I would support it.

 

[HirdsTheWord]

Nah I agree with Frumpy
You gotta walk the talk mate
Think global act local

eg :
I hate plastic bags and litter , therefore don’t use them and pick up others .
I Don’t just walk around saying “ everyone else is doing it “

Yeah but do you still use electricity,gas,petrol & other day to day products that also cause litter/damage in the environment?

Your analogy is not a good one.

 

[Madas]

Yeah but do you still use electricity,gas,petrol & other day to day products that also cause litter/damage in the environment?

Your analogy is not a good one.

No
They are needs not wants .

Investment property is a want which you have at great pains pointed out over the past 100 pages or so

 

[Taylor]

Yeh na
If you strongly believe something is wrong it’s nonsensical to partake in that act as it just perpetuates the problem

Even if it doesn’t change the world you know you are doing the right thing by your own standards

I would argue that if you're playing the game and seeking to have the rules of the game changed to make it fairer then it carries more weight than someone refusing to play the game because it's unfair and seeking to change the rules so they win without playing.

 

[HirdsTheWord]

No
They are needs not wants .

Investment property is a want which you have at great pains pointed out over the past 100 pages or so

Kinda seems like you doing something just because everyone else is doing it, go live off renewable energy, its there for you. Just way more expensive. Pot.Kettle.Black. that's exactly why I'm saying investment properties should not be allowed to be claimed as a tax deduction...i suppose you get it now?

it seems your main issue is just because i think myself getting a benefit its not the right thing, than i should be ghandi and give it up immediatley? Rather than say i would be supportive of policy changes to fix the issue. I'm literally saying I'm happy for it to be changed, but because i don't just give it up straight away I'm somehow wrong?

A very odd stance by you.

 

[Cuzz09]

Locking in last year at 1.99% fixed-rate until mid 2025 was money for jam.

WoW I thought my 2.29% til end of 23 was decent.

Good one

Ive deliberately increased my fortnightly payments, by a decent amount... not a crazy amount, over the last few months so by the time my fixed loan tuns out Im used to the amount Im gonna end up paying and also smash it down a bit.

On SM-G925I using BigFooty.com mobile app

 

[HPKS]

Like I said yesterday the cycle will continue in a few years and we’ll be back to where we started. But and it’s a big but imo it’s inevitable that around the end of this decade NG will be gone or very much diminished. It will go the same way as climate issues. The last ten years were denial from a lot of people then eventually the youth got older and voted for parties that were prepared to attempt to tackle the issue, Greens, Teal & ALP.