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  1. #11
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    Quote Originally Posted by AMR View Post
    IMHO...

    Future capital gains are taxed/decreased, but for buy-and-holders like myself cashflow will improve (which we will recieve in a much shorter timeframe).
    I still don't understand. Do you mean that CGT introduction will prompt/induce landlords to somehow pass the tax to tenants by way of a rent increase. I seriously doubt that in the current economic scenario.

    In my view, as long as bank lending to small business and investors remains tight, I don't see any sustainable improvement in either the economy/employment/wages or our GDP. But ironically, lending won't be loosened without asset reflation, low interest rates environment and currency pain.

    Good things are happening though. Migration is picking up. Bollard has shown committment to hold interest rates low. Key has sealed some brilliant FTAs. Kiwisaver is slowly building up the national pool of investible savings. But miles to go before we sleep...

  2. #12
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    I always used property as a cheap way to borrow money for my business ventures.
    The bank had the security of this asset rather than pie in the sky schemes to consider allowing me cheaper rates than I might have expected.
    Try buying a bulldozer or digger on credit where you might expect it to pay for itself in a couple of years doing the project.
    The business world runs on credit, property is the banks safest investment lending money.
    The number of houses in the country is ruled by supply, and demand, to many the price drops, to few the prices rise, which rules how many new homes get built.
    Mum and dad buy a house they borrow money. The landlord buys a house he borrows money and pays tax with the tenants money. The council buy a house to rent out they use your money pay people to watch over it pay tax and increase your rates.
    There is no requirement to state what happens when the GOVT buys a house we all know who pays for that. The very cheapest way is encourage the mum and dads to borrow money to buy a property rather than get ripped off by the business world as happened so often in the past. It in the GOVT interest that they tax and control every little aspect of our lives even owning your own home. Macdunk

  3. #13
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    Yes just drive around any state housing area and the houses are poorly maintained by the landlord. As a private landlord I can't afford to do that or the value of my investment decreases and the rentable value will decline. The government, while it does have a social role, makes a poor landlord.

  4. #14
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    Quote Originally Posted by Arbitrage View Post
    Yes just drive around any state housing area and the houses are poorly maintained by the landlord. As a private landlord I can't afford to do that or the value of my investment decreases and the rentable value will decline. The government, while it does have a social role, makes a poor landlord.
    I think anyone would given the quality of many of their tenants.

  5. #15
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    I can see a possible shortages in rental property with this new tax coming up. Why would anyone buy investment properties if the numbers dont work out? Tenants will be the ones losing out. Just have to look at the Aussie market to see where we are going with this.

    But then, I am only guessing at this stage. Need to see the detail of the tax changes before one can make an assessment.
    Having got ourselves into a debt-induced economic crisis, the only permanent way out is to reduce the debt – either directly by abolishing large slabs of it, or indirectly by inflating it away.

  6. #16
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    Quote Originally Posted by Dr_Who View Post
    I can see a possible shortages in rental property with this new tax coming up. Why would anyone buy investment properties if the numbers dont work out? Tenants will be the ones losing out. Just have to look at the Aussie market to see where we are going with this.

    But then, I am only guessing at this stage. Need to see the detail of the tax changes before one can make an assessment.
    No need to worry. CGT is only payable when there is a CG.

  7. #17
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    I see the sydney house prices are now averaging around A$600,000. Talking about capital gains, is this the future for Auckland? We have followed similal trends in the past. The way population growth is going here, you would have to look at property as a medium to long term punt, barring an extreme form of cgt being introduced.

  8. #18
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    Great article in the NBR last week.

    Basically it is saying that CGT and land taxes have fallen out of favour with the politicians, and the removal of depreciation and/or ring-fencing is the more likely option. Argument goes that depreciation is wrong because the assets rise in value.
    Disclaimer: Do not take my posts seriously. They are only opinions.

    AMR has sold all shares and is pursuing property.

  9. #19
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    Quote Originally Posted by AMR View Post
    Great article in the NBR last week.

    Argument goes that depreciation is wrong because the assets rise in value.


    I'm not sure where you heard that argument, but it's nonsense. Asserts rise in value when , as they get old they become worth more than a replacement new one. A second hand sheet of gib-board has most definitely depreciated. So has every other building component. So depreciation is a genuine cost, albeit not a cash expense. It was a bit of an anomaly a few years ago, but an amendment to tax law has made recovered depreciation taxable.

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