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  1. #181
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    ECON101 - and the government has since 2017 tells us the country needs more new builds and was voted in on that basis. So the question is - if there is demand for them, even massive government funding for social housing and Kiwibuild and underwrites, why haven't they happened? And how does changing tax rules for existing rental properties support more new builds, when they did not happen under the previous tax rules?

    Because reasons?

  2. #182
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    Quote Originally Posted by Bjauck View Post
    Tax is not the answer to everything - although an increase in tax revenue would help to boost government revenue and help repay Covid expenses and debt.
    Easily said, but it very much depends where we sit on the Laffer curve. Seems to me we are very near the peak.

  3. #183
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    Quote Originally Posted by fungus pudding View Post
    Easily said, but it very much depends where we sit on the Laffer curve. Seems to me we are very near the peak.
    With respect to taxation on Investor returns from residential real estate, we are nowhere near the peak. With respect to taxation of wage and salary earnings then we are more likely to be near the peak.

  4. #184
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    OMG bringing the Laffer Curve into the discussion.

    “How high should the top personal income tax rate be?”

    “Well, the Laffer curve says its got to be between 0% and 100%”
    When investors are euphoric, they are incapable of recognizing euphoria itself.

  5. #185
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    Quote Originally Posted by winner69 View Post
    OMG bringing the Laffer Curve into the discussion.

    “How high should the top personal income tax rate be?”

    “Well, the Laffer curve says its got to be between 0% and 100%”
    That's a silly remark. The trick is to find the point on the curve that is most efficient; or more importantly, to recognise that raising taxes (or prices in business) does not necessarily make for increased revenue (or turnover).

    P.S. Laffer sees 0% and 100% as the two known points that produce the same result. There is always a high figure and a low figure that will produce equal revenue.
    Last edited by fungus pudding; 16-06-2021 at 01:00 PM.

  6. #186
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    Quote Originally Posted by winner69 View Post
    OMG bringing the Laffer Curve into the discussion.

    “How high should the top personal income tax rate be?”

    “Well, the Laffer curve says its got to be between 0% and 100%”
    Capital gain on houses in NZ is not considered income and therefore, does not form in part of the tax revenue by IRD.

    However, what matters to the person investing is what after tax benefit do they see? A) Buy houses or B) Kiwi Saver funds ? Historically it's always been the former that has the choice for making $ - and therefore taxation being of moot interest in the Laffer Curve (maximising efficiency).

  7. #187
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    Quote Originally Posted by winner69 View Post
    OMG bringing the Laffer Curve into the discussion.

    “How high should the top personal income tax rate be?”

    “Well, the Laffer curve says its got to be between 0% and 100%”
    Capital gain on houses in NZ is not considered income and therefore, does not form in part of the tax revenue by IRD.

    However, what matters to the person investing is what after tax benefit do they see? A) Buy houses or B) Kiwi Saver funds ? Historically it's always been the former that has the choice for making $ - and therefore taxation being of moot interest in the Laffer Curve (maximising efficiency).

  8. #188
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    https://www.oneroof.co.nz/news/39651

    Say it aint so, its about the land.

  9. #189
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    Maybe there's been too much stimulus or its been too broad.

    The govt could wind down some work so residential property has a chance.

    Interesting to contrast this situation to that described on the first page.
    Where are all the people coming from? NZ must be an attractive destination.
    Last edited by Panda-NZ-; 23-06-2021 at 01:02 AM.

  10. #190
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    Quote Originally Posted by Panda-NZ- View Post
    Maybe there's been too much stimulus or its been too broad.

    The govt could wind down some work so residential property has a chance.

    Interesting to contrast this situation to that described on the first page.
    Where are all the people coming from? NZ must be an attractive destination.
    As I been saying all along. The demand is fueled by tax advantages (or lack of income tax) on housing investments. You know the people that have the $ and income that can borrow cheap money.

    In addition to a supply problem but the latter above is by far the #1 incentive bar none.

  11. #191
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    Quote Originally Posted by SBQ View Post
    As I been saying all along. The demand is fueled by tax advantages (or lack of income tax) on housing investments. You know the people that have the $ and income that can borrow cheap money.

    In addition to a supply problem but the latter above is by far the #1 incentive bar none.
    These "tax advantages" are completely normal across most of the world including depreciation on real estate and no ring fencing. The ring fencing actually makes property investing less advantageous compared to business as you can deduct losses on business against your income. I think what you're trying to get to is no CGT. Well for most of those horrible investors, CGT doesn't matter, because they won't sell for decades or they'll just leave it to their children.

    You know the #1 problem is not investors, but supply. Saying otherwise is plain lying. There's 20000 people on HNZ waitlist and thousands in emergency housing and you're saying problem is there are people who provide rentals. Most of the investors took a step back to wait for government to reveal the new rules and houses are still flying off the shelves and prices rising.

    RMA should have been changed years ago to allow easier and cheaper development. There also needs to be a shift in NZ mentality to accept you can't grow a city without building apartment buildings.
    Last edited by peetter; 24-06-2021 at 12:53 PM.

  12. #192
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    https://www.google.com.au/amp/s/thes...as-lost/%3famp

    Bernard Hickey has nailed it.
    I agree there is zero future for many young Kiwis hoping to own a home here.
    The property market in NZ is an absolute discgrace.
    Last edited by ynot; 26-06-2021 at 03:08 PM.

  13. #193
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    Quote Originally Posted by SBQ View Post
    As I been saying all along. The demand is fueled by tax advantages (or lack of income tax) on housing investments. You know the people that have the $ and income that can borrow cheap money.

    In addition to a supply problem but the latter above is by far the #1 incentive bar none.
    It is only a supply problem. Nothing more

  14. #194
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    Quote Originally Posted by ynot View Post
    https://www.google.com.au/amp/s/thes...as-lost/%3famp

    Bernard Hickey has nailed it.
    I agree there is zero future for many young Kiwis hoping to own a home here.
    The property market in NZ is an absolute discgrace.
    Coupled with a complete lack of strategy to improve productivity or to create a high paying jobs, NZ's future is decidedly bleak.

  15. #195
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    Quote Originally Posted by ynot View Post
    https://www.google.com.au/amp/s/thes...as-lost/%3famp

    Bernard Hickey has nailed it.
    I agree there is zero future for many young Kiwis hoping to own a home here.
    The property market in NZ is an absolute discgrace.
    The societal flow on effects paints a bleak picture for NZ.

    Quote Originally Posted by fungus pudding View Post
    It is only a supply problem. Nothing more
    I believe this to be incorrect. The root cause is excess liquidity through money printing / low rates. For example, you could not have prices at current levels due to lack of supply, but no excess liquidity (i.e. even if there was a shortage of houses, there would be an even greater shortage of people that could afford a $1m mortgage at 7% interest). On the contrary, you can achieve current prices due to excess liquidity alone, without an associated true undersupply. If you need evidence of this look at the 2008 housing bust.
    Last edited by JohnnyTheHorse; 26-06-2021 at 03:44 PM.

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