Quote Originally Posted by artemis View Post
What say time passes and income increases? Say for a small tradie business where tools and a couple of vans are secured against the family home. Starts small, builds clients and income. They can still offset losses against other income. It's just residential rentals that are now not allowed to.

Rentals usually turn cash flow positive after a few years. Ring fencing rental losses just defers offsets until then. Again, timing.

Meantime, owners will make decisions in their best interests. Like essential maintenance only for example, and decent rent increases.
I guess tradie businesses don't make the Kiwi dream of owner-occupier home ownership unaffordable for so many families? It is more of a political hot potato perhaps.

Perhaps some rental owners always have a high percentage mortgage so that that their rental properties seldom turn a net profit, whilst racking up leveraged capital gains? Maybe the ring fencing is aiming at that scenario.