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Rental properties
Rental properties...the NZ Treasury have stated that by removing tax incentives for rental property owners will result in rent increase's....now if that is not the most profound understatment of the century...please let me know.;...this lot must be the biggest despository of Mensa minds in the world...
PS ..and bye the way who else will be fronting up to provide rental properties....councils...govt....
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Originally Posted by troyvdh
Rental properties...the NZ Treasury have stated that by removing tax incentives for rental property owners will result in rent increase's....now if that is not the most profound understatment of the century...please let me know.;...this lot must be the biggest despository of Mensa minds in the world...
PS ..and bye the way who else will be fronting up to provide rental properties....councils...govt....
There are no tax incentives applying to real estate that do not apply to any other investmernt or business. The thing that sets rent levels is supply and demand. Nothing else. If treasury does anything at all to discourage real estate investment - guess who will buy the properties then? How right you are - the potential tenants. That will lower dewand in equal numbers to lowered supply.
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MMM
Originally Posted by fungus pudding
There are no tax incentives applying to real estate that do not apply to any other investmernt or business.
What about the tax incentive of being able to claim depreciation on an appreciating asset? As well as being able claim Repairs & Maintenance to ensure it does not depreciate. The tax incentives applying to residential property investment are (IMHO) like a long term share investor being able to claim depreciation each year on share investments (and being able to offset that agianst other income/earnings) AND not having to pay capital gains tax on selling the shares.
"Annual income twenty pounds, annual expenditure nineteen six, result happiness . Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
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The Treasury discussion has been fascinating.... A change in the way property investment is taxed will have all sorts of repercussions. Lets hope that ultimately any changes made will result in more productive investment; more equitable taxation; more sustainable building; and a minimum of financial hardship for tenants.
It is interesting that property prices are likely to rise too under some scenarios. If rent increases people like me that choose to rent, will likely buy and put pressure on house prices.
All I really hope is that something happens to deter property investment, and NZ becomes a more prosperous/financially savvy country.
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Originally Posted by Wilkins_Micawber
What about the tax incentive of being able to claim depreciation on an appreciating asset?
Building materials do depreciate. Land may appreciate, but depreciation claim does not involve land. Improvements may appear to appreciate but that is because money is depreciating in value. But rest assured improvements steadily reduce in terms of their replacement cost.
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The ball does not lie in the central government's hands, but rather John Banks/Len Brown.
The councils are responsible for limiting the amount of land available, and then by making it uneconomical for developers to increase population densities by applying excessive development contributions.
Disclaimer: Do not take my posts seriously. They are only opinions.
AMR has sold all shares and is pursuing property.
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Member
Refurbishment
Originally Posted by Wilkins_Micawber
What about the tax incentive of being able to claim depreciation on an appreciating asset? As well as being able claim Repairs & Maintenance to ensure it does not depreciate. The tax incentives applying to residential property investment are (IMHO) like a long term share investor being able to claim depreciation each year on share investments (and being able to offset that agianst other income/earnings) AND not having to pay capital gains tax on selling the shares.
Depreciation of building and chattles is a real expense. Replacing carpets, bloody bathrooms and Kitchens costs us a fortune. The tax deductiblilty is legimate.
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MMM
Originally Posted by bohemian
Depreciation of building and chattles is a real expense. Replacing carpets, bloody bathrooms and Kitchens costs us a fortune. The tax deductiblilty is legimate.
But you have it both ways - you deduct the expense of the repairs AND claim depreciation on the items being repaired. I only disagree with the ability to claim depreciation on the buildings as they do not really depreciate (providing that normal repairs and maintenance are carried out).
"Annual income twenty pounds, annual expenditure nineteen six, result happiness . Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
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Originally Posted by Wilkins_Micawber
But you have it both ways - you deduct the expense of the repairs AND claim depreciation on the items being repaired. I only disagree with the ability to claim depreciation on the buildings as they do not really depreciate (providing that normal repairs and maintenance are carried out).
Of couse they depreciate. Name one compnent, roofing material, timber paint, plumbing, wiring - that doesn't depreciate.
Ask yourself whether you would pay more for a 20 year old building, or a brand new one, built next door on a comparable site, using the same plans and materials - an exact replica. Or to put it another way - every day of a building's life it moves further below its replacement cost. That is depreciation.
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MMM
Originally Posted by fungus pudding
Of couse they depreciate. Name one compnent, roofing material, timber paint, plumbing, wiring - that doesn't depreciate.
Ask yourself whether you would pay more for a 20 year old building, or a brand new one, built next door on a comparable site, using the same plans and materials - an exact replica. Or to put it another way - every day of a building's life it moves further below its replacement cost. That is depreciation.
Fair comment - I guess I am thinking from the view point of value. Buy a house today and sell it in 20 years and I would be willing to bet that the value of the house is more (not less) than it was when it was bought. To me that is an a-ppreciating (not de-preciating) asset (esp if it appreciates by more that the CPI).
"Annual income twenty pounds, annual expenditure nineteen six, result happiness . Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
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