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  1. #201
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    Quote Originally Posted by peetter View Post
    Investing in houses is the best game in town almost anywhere. CGT hasn't changed that in any country. Even with tax free share investments and CGT on property, you'll never beat the property just because the leverage gives you better returns. Also tax free retirement fund gives you money when retired, so government doesn't have to give you back part of what you paid during working decades, but does nothing for your quality of life during your working years.

    There's no better way for low to middle class salary earner to get wealthy than property. Not everyone is capable to start business.

    I am all for CGT, it will change nothing... well something... share gains will be taxed.
    Investing in home ownership and investor Real estate is still one of the best investment avenues in the countries we like to compare NZ with - for example the UK, Australia and Canada. However those countries do try to have a tax system so that investment real estate property gains have a similar tax burden to gains from other investments. This is achieved through CGT, stamp duties and a grossing up of pension plan contributions and with gross income accumulating in pension plans.

    I think consequently those countries have a stock market capitalisation at a size more in keeping with the size of their economies - unlike NZ's.
    Last edited by Bjauck; 27-06-2021 at 08:12 AM.

  2. #202
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    Quote Originally Posted by fungus pudding View Post
    Speak for yourself. It certainly wasn't for me - or others I know. When I began buying houses in the 1960s I never gave one thought to capital gain. I invested to build an income. Full stop. So did other landlords I got to know.
    @ peetter

    Investing in houses is the best game in town almost anywhere. CGT hasn't changed that in any country. Even with tax free share investments and CGT on property, you'll never beat the property just because the leverage gives you better returns. Also tax free retirement fund gives you money when retired, so government doesn't have to give you back part of what you paid during working decades, but does nothing for your quality of life during your working years.

    There's no better way for low to middle class salary earner to get wealthy than property. Not everyone is capable to start business.
    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.

  3. #203
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    Absolutely.
    You need look no further than Australia's
    9% employer super contribution or the 15% tax cap on salary sacrifice contrbutions on super to see NZ govt effort to assist the kiwi middle class to save toward retirement is non existent.
    Successive NZ governments have failed the middle class to the extreme.
    Now they are going to fail their children as well.
    The damage from this situation can not be overstated.
    Last edited by ynot; 27-06-2021 at 09:20 AM.

  4. #204
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    Quote Originally Posted by SBQ View Post
    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.

    You're wrong. Unless you're extremely lucky, you won't get higher return from shares than property as a beginner investor. You can put down 5% here. Buy house needing a lot of work. Spend some time fixing it and increase value of that house by tens of thousands of dollars. This only snowballs when you know what to do. On the other hand that 5% deposit would only double in 10 years in sharemarket.

    I do agree with you that the government should give people better tax free option to save for retirement though. And as I said before, I am all for CGT.

    I don't want to go discussion about what's greedy and not. I am from post soviet country, so I am pretty alergic to people who think redistribution of wealth is the way to go.

  5. #205
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    Quote Originally Posted by peetter View Post
    ...
    I don't want to go discussion about what's greedy and not. I am from post soviet country, so I am pretty alergic to people who think redistribution of wealth is the way to go.
    Behind the old Iron Curtain, weren't the Communist Party Officials in effect the born-again aristocracy with privileged access to healthcare, cars and appartments etc?

    It is not necessarily a question of redistributing wealth, but just ensuring a fair rate of tax is levied on all investment returns. It makes me laugh when many of those promoting a "flat tax", conveniently ignore capital and non-income gains. In effect they want a flat income tax, while keeping capital gains mostly untaxed. In other words they want to keep a highly regressive overall tax system with the onus on income earners and GST.

  6. #206
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    Quote Originally Posted by JohnnyTheHorse View Post
    The societal flow on effects paints a bleak picture for NZ.



    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.
    Slap up 200,000 new houses and of course you'll see prices and rents drop.

  7. #207
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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.
    Jeeze that's a depressing Sunday read. Suits the day. No easy answers that are politically acceptable. Thanks for posting it.

  8. #208
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    [QUOTE=RTM;892417]Jeeze that's a depressing Sunday read. Suits the day. No easy answers that are politically acceptable. Thanks for posting it.[/QUOTE

    Hate to be the bearer of bad news but we do need to face the implications. We have in effect stolen what I consider the birthright of all Kiwis, to own a home.
    Whats more, it's obvious politicians don't give a rats a... . They still get their fat paychecks.
    Last edited by ynot; 27-06-2021 at 12:56 PM.

  9. #209
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    Are u saying that a flick of the hair,a toothy grin and a frown can't fix this?
    Under new laws that may come in this would be considered hate speech.

  10. #210
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    Are u saying that the flick of the hair,a toothy grin and a frown can't fix the housing problem?
    This is hate speech and Kris Fafoi must be advised pronto.

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