Originally Posted by
BlackPeter
The real estate bubble (if it turns out to be a bubble - at current it is just a continuous uptrend with the odd minor ripple) has little to do with CGT or the lack thereof.
The main culprits are
- low interest rates - i.e. people can afford to pay more for a scarce resource (a worldwide problem)
- money created by QE searching a new home (see what I did there :) ) - again a worldwide problem,
- very expensive building methods (stick by stick instead of using industrial production methods - this is a NZ specific problem) and
- the aversion of most Kiwis to live in apartment buildings
(admittedly, there are hardly any good quality apartments in NZ. Chicken - egg?) - obviously a home made problem as well
Don't blame the lack of CGT for our high property prices ... most countries do have a CGT and housing is expensive there as well everywhere where people can find a job and want to live ...
Sure - I hear property prices in the UK are dropping, but this is because people don't want to live there anymore.