Even in 2000, working on the passive income was all talked about in rental properties. When I 1st arrived to NZ I was surprised of this that the philosophy was "getting the tenants to PAY FOR the mortgage!" I thought how can this be as this was never the case back in Canada because the focus was capital gain there. I questioned if you can sucker tenants to pay enough rent $ that would service 100% of the mortgage like in a business, then why the hell can't the tenant go for a mortgage themselves? I have friends back in Canada that worked on the angle the rental income only 'supplements' their mortgage and because of this, it is still NOT the best game in town.
Overall you've missed my point and as what Bernard Hickey has been saying, NZ has on demand controls on the purchase of multiple houses by investors. No one is saying that the principal resident should be tax free. What other countries have done is at least, discourage the activity of MULTIPLE HOUSE ownership - where do you draw the line and what is the ethical point of view. There's a social mobility problem in NZ. What I miss in Canada so much is the working class does GET the benefit on various gov't registered investment plans and you will be mistaken (as a close friend in Vancouver who invested early in real estate there told me), buying stocks hindsight would of been the better option. When regular families can have RESP, TFSA, that the question being able to afford for their children's uni education is solved through investment which is tax free. The Cdn gov't even matches grants to these investment schemes ensuring that a better Canada is rooted on education. The culture and education there tells us that owning multiple houses returns you less and far less productive than any other venture. Likewise, the banks there have moral suasion meaning they are not quick to lend $ to a person that already owns 2 or 3 properties (in favour to lending to the 1st home owner - which is gov't CMHC backed insured). All the new measures that the Cdn gov't has done in the past 30 years - what has the NZ gov't done in respect to housing affordability? PISS ALL NOTHING and Bernard Hickey has pushed this question why and formally says today - there's no hope - move over to Australia.
You don't have to take my word on this issue or agree that buying multiple houses is the best game in town in say Canada. I know it's not by just looking at the total make up of investments made in Canada. In NZ we probably have like 80% of the wealth tied in bricks and motar and 20% in the NZX. In Canada it's closer to the other way around.
I STRONGLY suggest the people to hear out and read what Bernard Hickey had to say in ynot's link. Let me repost:
https://thespinoff.co.nz/business/25...tion-was-lost/
Because I can assure you, those in that camp winning, sitting on multiple house ownership, is too busy gloating on how much their wealth is and how they're able to send their kids to expensive private school etc. We've become a society about 'all for myself and who cares about the others'.
Oh and peetter's comment that not everyone can start a business. Let me ask you what exactly does the word "shareholder" mean? Warren Buffet insists that owning stocks means you are a "PART OWNER of THAT BUSINESS", either big or small investor - everyone gets the same benefit. Unfortunately in NZ, our Kiwi Saver funds are taxed, just like the PIE funds etc. Why is the productive class fooled into this issue that a 3% matching from the employer means they're all of a sudden a shareholder with purpose when their retirement fund pales in value to the same person working in Canada or in the US under a deferred tax scheme? Quite certainly in NZ, the table has been skewed towards the tax free nature of owning multiple houses.