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View Poll Results: Should there be a Capital Gains Tax on Property

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  • No

    202 100.00%
  • Yes

    60 58.25%
  • Goff is just an idiot

    2,147,483,655 100.00%
  • Epic fail for Labour

    1,930 100.00%
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  1. #451
    Legend minimoke's Avatar
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    Quote Originally Posted by JBmurc View Post
    and asking prices well over GV-RV
    GV (??) / RV are totally meaningless numbers. The only people who can use RV are your local council. And it has nothing to do with value but all to do with how much to charge you for rates.

    Which is why RV cannot be used on Valuation Day.

  2. #452
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    Quote Originally Posted by elZorro View Post
    Pretty disingenuous of you to constantly say that private dwellings should be subject to CGT when you realise it's not politically possible, and for good reason. Here's a discussion on the benefits of home ownership vs renting.

    https://www.nzherald.co.nz/personal-...ectid=12019370

    ...
    Just because something is “not politically possible” at the current time does not mean that those who support a policy should keep quiet. Surely the essence of a free democracy would be then be lost? So many reforms were politically impossible when first mooted.

    Besides as home ownership rates fall, the vested interest of home owners may also become less compelling. Add to the mix a continued divergence of ownership of wealth in NZ and social expediency may well dictate a re-examination of the possible.

  3. #453
    Legend minimoke's Avatar
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    Quote Originally Posted by Bjauck View Post
    Just because something is “not politically possible” at the current time does not mean that those who support a policy should keep quiet. .
    CGT is politically possible on the family home. Its just that, in the absence of any more compelling reasons to vote, it would be political suicide.

  4. #454
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    Quote Originally Posted by Bjauck View Post
    Just because something is “not politically possible” at the current time does not mean that those who support a policy should keep quiet. Surely the essence of a free democracy would be then be lost? So many reforms were politically impossible when first mooted.

    Besides as home ownership rates fall, the vested interest of home owners may also become less compelling. Add to the mix a continued divergence of ownership of wealth in NZ and social expediency may well dictate a re-examination of the possible.
    Even back in the day it was more expensive to slowly pay off a house each month, than rent. When you add in all the other risks and costs with home ownership, it's not altogether rosy, as that article said. Plus, this investment is by and large the family's only major investment, it's out of their tax-paid savings, and they cannot reclaim any of the costs.

    The rentier is in an entirely different situation, where a paper transaction has been made using the property security and free capital from other sources like their own home, tax claims can be made offsetting other income, and the net amount of cashflow invested is low per month, dwindles away and quickly or eventually goes positive with rent increases. These same rentiers can be heard saying amongst themselves how easy it all is, they're smarter then the average bear. The big payoff is at the end years later, where all the inflation and any true capital gain on the property is theirs to have, free of any tax.

  5. #455
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    Quote Originally Posted by elZorro View Post
    Even back in the day it was more expensive to slowly pay off a house each month, than rent. When you add in all the other risks and costs with home ownership, it's not altogether rosy, as that article said. Plus, this investment is by and large the family's only major investment, it's out of their tax-paid savings, and they cannot reclaim any of the costs.

    The rentier is in an entirely different situation...
    The home owner cannot reclaim costs as they are not assessed for IT on the net annual benefit of occupation and they are not assessed on the capital appreciation of the equity in their asset.

    I agree, their situations are different. As is the situation of owners of shares and businesses. The owners of all assets face uncertainty and risks to greater or lesser extents.

    The owners of shares have also paid for their investment out of tax-paid savings. They are less likely to be able to leverage to the same extent their investment on the collateral of the investment itself. The share prices are more volatile than the value of housing. The business in which they invested also pays tax on the net income generated (unlike the imputed rent or tax-free net benefit of the owner-occupied principal residence.)
    Last edited by Bjauck; 05-03-2019 at 10:08 AM.

  6. #456
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    How come the Labour Party coalition is being VERY silent on any DETAILS of this CGT? You would think National party would be able to dig in more details about the proposal?? Jacinda Ardern, please speak up!!!

  7. #457
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    Quote Originally Posted by elZorro View Post
    Even back in the day it was more expensive to slowly pay off a house each month, than rent.
    Only if you overlook that part of the regular payment was reducing the capital of the loan. IOW - paying yourself.

  8. #458
    FEAR n GREED JBmurc's Avatar
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    Quote Originally Posted by minimoke View Post
    GV (??) / RV are totally meaningless numbers. The only people who can use RV are your local council. And it has nothing to do with value but all to do with how much to charge you for rates.

    Which is why RV cannot be used on Valuation Day.
    Well, they are not meaningless even though I've heard the same from R.E Agents .... they certainly are not exact ... but I've had Banks use them in the past sometimes over reg. valuation as they didn't trust the valuer ... then using the banks approved valuer they would come in very closely to what sold over R.V in the area the property was listed ....

    looking to buy another commercial property recently I was looking over sales to RV of the 5 most recent sales in the town all sold within 5% of the RV..

    To date I've had 21x NZ Property transactions
    People don't have ideas, ideas have people

  9. #459
    Legend minimoke's Avatar
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    Quote Originally Posted by JBmurc View Post

    looking to buy another commercial property recently I was looking over sales to RV of the 5 most recent sales in the town all sold within 5% of the RV..
    That is coincidence.

    Rating valuations are done each three years. So for a start you have a +/- between the time of the last valuation and the time of latest sale. Then add the time it takes for the valuation process to run - that may add another 6 months to your total cycle

    Now add in the problem that the RV does not include the value of Chattels such as carpets and curtains.

    Now add in anomalies in sales. For example an area may not have had any sales.

    Now add in the problem with clerical errors - council staff not properly recording details (for example in my renovation they missed of 40sqm of additions)

    Now add in natural variance of say +/- 10% for any desktop process.

    All this adds up to a number that can be way removed from actual market value.

    Add in a lack of back checking. For example two of my neighbours have exactly the same size of land. But there is a $50,000 difference between their two land values. I have 50% more land than these two and my land value is only 10% more.

    My RV is about $500k less than current market value. Do I complain. No. Because I am happy paying rates based on this lower level.

    But I do have another valuation - and that is for insurance purposes. That's my Sum Insured Value and is much closer to market value

    Disc - cant comment on commercial property - But I would think same principles apply

    Edit. Just checked Christchurch rates. Last exercise was done with effect from 1 August 2016. New valuations were released on 30 November 20i6. So it took the valuer 4 months to value 167,000 properties. That's going to be accurate. Yeah right!
    Last edited by minimoke; 05-03-2019 at 11:49 AM.

  10. #460
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    Quote Originally Posted by minimoke View Post
    That is coincidence.

    Rating valuations are done each three years. So for a start you have a +/- between the time of the last valuation and the time of latest sale. Then add the time it takes for the valuation process to run - that may add another 6 months to your total cycle

    Now add in the problem that the RV does not include the value of Chattels such as carpets and curtains.

    Now add in anomalies in sales. For example an area may not have had any sales.

    Now add in the problem with clerical errors - council staff not properly recording details (for example in my renovation they missed of 40sqm of additions)

    Now add in natural variance of say +/- 10% for any desktop process.

    All this adds up to a number that can be way removed from actual market value.

    Add in a lack of back checking. For example two of my neighbours have exactly the same size of land. But there is a $50,000 difference between their two land values. I have 50% more land than these two and my land value is only 10% more.

    My RV is about $500k less than current market value. Do I complain. No. Because I am happy paying rates based on this lower level.

    But I do have another valuation - and that is for insurance purposes. That's my Sum Insured Value and is much closer to market value

    Disc - cant comment on commercial property - But I would think same principles apply

    Edit. Just checked Christchurch rates. Last exercise was done with effect from 1 August 2016. New valuations were released on 30 November 20i6. So it took the valuer 4 months to value 167,000 properties. That's going to be accurate. Yeah right!
    No seems to be different for Commercial as they haven't had the same price growth like RES has i.e I'm currently looking at one property 20k under RV .. asking price the same as what it sold for 4yrs ago .. R.V has increased asking price has not ..can't say I've come across many commercial way over like RES property in the AREAS I'm looking

    we purchased property here in central otago during 2016 RV 550k we paid 560k now worth over 850k etc so yes old RV way off now ..but its all relative no doubt when next RV come out it will be much higher ... just like your property will be ..

    I never have thought RV are accurate as like we know they only do them every so many years.. but I still like to see what it is when looking at property to compare to other properties R.V and then of course how high over sales have been recently ...

    End of the day value is what someone is willing to pay .... I think many overpriced RES properties with hyped up REG valuations will come unstuck soon enough as the Building bOOM runs its course...
    Last edited by JBmurc; 05-03-2019 at 04:52 PM.
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  11. #461
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    Call me dumb but what is the exact definition of "Family home'?
    Can a de facto partner have a family home? Can I have a family home also?. Can a family trust have a family home also?.
    Last edited by Brovendell; 05-03-2019 at 04:58 PM.

  12. #462
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    Quote Originally Posted by Brovendell View Post
    Call me dumb but what is the exact definition of "Family home'?
    Can a de facto partner have a family home? Can I have a family home also?. Can a family trust have a family home also?.
    I'd think ones home address ...any property that's not being rented lived in by owners etc
    People don't have ideas, ideas have people

  13. #463
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    Quote Originally Posted by JBmurc View Post

    we purchased property here in central otago during 2016 RV 550k we paid 560k now worth over 850k etc so yes old RV way off now ..but its all relative no doubt when next RV come out it will be much higher ... just like your property will be ..
    Your RV will be higher as there will be actual sales data for that property. Where as mine has no sales data - so all they can do is tweak it by whatever % they reckon is right.

    Edit. Heres a wee test. Flash house opposite me has just got a "sold" sign put on it. RV = $900,000. Went on the market Oct 2018 under auction - didn't sell. Then listed for $845,000 (around what I thought it would go for) and didn't sell. Now advertised at $798,000. I'll keep an eye out for actual sale price
    Last edited by minimoke; 05-03-2019 at 07:11 PM.

  14. #464
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    Quote Originally Posted by minimoke View Post
    Your RV will be higher as there will be actual sales data for that property. Where as mine has no sales data - so all they can do is tweak it by whatever % they reckon is right.

    Edit. Heres a wee test. Flash house opposite me has just got a "sold" sign put on it. RV = $900,000. Went on the market Oct 2018 under auction - didn't sell. Then listed for $845,000 (around what I thought it would go for) and didn't sell. Now advertised at $798,000. I'll keep an eye out for actual sale price
    Yes we got new RV last year i think it was upto 690k I see these days the banks uses some online instant valuer I guess like QV.co.nz can do early last year the bank believed are property was worth $815k ...insane lift in value... if the misses would allow me I'd list it for $850k and if sold go back renting for a year or two as these values aren't going to last
    Last edited by JBmurc; 05-03-2019 at 09:34 PM.
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  15. #465
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    Quote Originally Posted by JBmurc View Post
    Yes we got new RV last year i think it was upto 690k I see these days the banks uses some online instant valuer I guess like QV.co.nz can do early last year the bank believed are property was worth $815k ...insane lift in value... if the misses would allow me I'd list it for $850k and if sold go back renting for a year or two as these values aren't going to last
    I was at my bank the other day and they used www.homes.co.nz for instant valuations

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