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Future Property prospects.
With 18,600 gain in people coming into the country over people leaving the country last year during a recession, one might expect a building boom. However the GOVT are making silly noises about a capital gains tax on property owners, which should see a great rush towards the door.
It is my view that it matters very little in the broad term who actualy owns property.
It is in the GOVT interest that we all rent allowing them to tax landlords.
It is the mum and dads interest to have a safe haven for their savings rather than trust all the dodgy snout in the trough business people in this world.
Property in a rising population, should increase higher than inflation, however if we all rush in to buy to become rent free as a method of saving for the future then we cant have that can we ?.
Money to buy property is far cheaper to be run by private individuals, rather than from the council or the state where added running costs far exceed what mum and dad private ownership can acheave.
With any luck which I doubt they wont wreck the last safe haven for mum and dad investors. Macdunk
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If you look back at all the declarations made about our politicians financial holdings you will find that most of them own at least two properties. I think this will be a huge disincentive to changing the law on taxing investment property.
I am still uncertain about all the fuss. Rental properties are just another business. Profits are taxed, and losses can be claimed against income. Exactly the same as owning a fish and chip shop so why do people moan about it?
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Originally Posted by Arbitrage
If you look back at all the declarations made about our politicians financial holdings you will find that most of them own at least two properties. I think this will be a huge disincentive to changing the law on taxing investment property.
I am still uncertain about all the fuss. Rental properties are just another business. Profits are taxed, and losses can be claimed against income. Exactly the same as owning a fish and chip shop so why do people moan about it?
God only knows. Residential landlords should be given medals, knighted and receive govt. paid annual holidays in luxury resorts plus free psychiatric care. Especially the last bit.
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Originally Posted by fungus pudding
God only knows. Residential landlords should be given medals, knighted and receive govt. paid annual holidays in luxury resorts plus free psychiatric care. Especially the last bit.
WOOT! You can now call me Sir Doc and you can contact me permanently at the best resort in the Cook Islands.
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.
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CGT will be the best thing that happens for property.
Rents will skyrocket, so buying for cashflow actually becomes possible.
Disclaimer: Do not take my posts seriously. They are only opinions.
AMR has sold all shares and is pursuing property.
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Originally Posted by Arbitrage
If you look back at all the declarations made about our politicians financial holdings you will find that most of them own at least two properties. I think this will be a huge disincentive to changing the law on taxing investment property.
I am still uncertain about all the fuss. Rental properties are just another business. Profits are taxed, and losses can be claimed against income. Exactly the same as owning a fish and chip shop so why do people moan about it?
Agree with f p as well.
It is that many buy for the "capital gain" and use the expenses to reduce their own tax and they never (hardly ever) get taxed when they sell ( hence the "fuss") and many do/have sell/sold, there was a lot of that before the property market dropped after the huge gains. It is this the IRD needs to get on top of so to speak.
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How so?
Originally Posted by AMR
CGT will be the best thing that happens for property.
Rents will skyrocket, so buying for cashflow actually becomes possible.
What is the overriding advantage or connection in your opinion AMR?
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People will borrow to buy property whereas they generally don't to buy shares so in that way its not 'just another investment' due to the particular distortions that borrowing creates ie buying to make tax losses and capital gain rather than income. When selling, all sots of shenanigans go on to avoid paying back depreciation claimed.
Widespread borrowing for rental properties and housing in general has also increased NZ's risk profile which is a reason our interest rates are higher than a lot of other countries.
The above are good reasons to treat rental properties differently than other investments/businesses. Personally I won't touch one until I know what the govt are going to do in this area. They will do something, there's even a lot of acceptance out there about a capital gains tax. Don't think they'll do it, however, but ring-fencing losses looks a better than even chance.
Last edited by Snapper; 24-11-2009 at 11:42 AM.
Reason: grammar
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Originally Posted by beacon
What is the overriding advantage or connection in your opinion AMR?
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).
Ring-fencing...now that is the scary one! Anyone highly leveraged with a high depreciation component is dead!
Disclaimer: Do not take my posts seriously. They are only opinions.
AMR has sold all shares and is pursuing property.
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Originally Posted by AMR
IRing-fencing...now that is the scary one! Anyone highly leveraged with a high depreciation component is dead!
If they ring fence, cant I just move the debt from my rental to my shares (secured by the rental so interest is low) and make a loss on my shares?
Are they going to ring fence everything else.
Have they considered removing deprecation. it is that non cash expense that subsidises housing. Everything else is an acutal cost and therefore an actual loss.
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