realestatebusiness logo
realestatebusiness logo
Subscribe to our newsletter SIGN UP

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Labor’s negative gearing to hurt those it aims to help most, warns network CEO

05 October 2018 Tim Neary
Doug Driscoll, caution, warning, negative gearing

Labor’s negative gearing plans will disadvantage some first home buyers and lower-income Aussies who are property investors working hard to get ahead, a renowned real estate CEO has said.

On the back of recent political party debates over Australia’s housing affordability plans, Starr Partners CEO Douglas Driscoll said that Labor’s plans to limit negative gearing to new housing and halving the capital gains tax concession will do little to help.

He said that it would be more effective to means-test investor tax subsidies and cap the number of properties that can be negatively geared.

Mr Driscoll also said that Labor has erred in suggesting that all investors are higher-income earners.


“I’m hearing from agents and brokers across markets popular with first home buyers that approximately 30–35 per cent are rentvesting,” the CEO said.

“They are often purchasing a property, living in it for six to 12 months, then putting it on the rental market.”

He said that Labor is trying to help middle and working-class families.

“But let’s not forget that many nurses, teachers and policemen are also purchasing investment properties; they make up the investor profile, too. The opposition’s proposed policy could inadvertently disadvantage many of the people it is trying to help.”

Instead, Mr Driscoll said that there are more effective strategies that would appease investors and nurture first home buyers.

“From what I can tell, this policy is a regurgitation of Labor’s previous election manifesto. What puzzles me most is that if it didn’t curry favour in the lead-up to the last election when investors made up the majority of the market, then how is it going to garner support now that their numbers have decreased considerably?”

He said that cooling house prices shows government’s macro-prudential measures are working, but agreed that more could still be done.

“Instead of limiting negative gearing, as Labor has suggested, Aussies that want to claim tax subsidies could be means-tested.

“This would ensure that higher-income earners are not benefitting the most, and tip the balance in favour of those that need the subsidies the most. Alternatively, capping the volume of properties an investor can negatively gear will reduce the number of negatively geared properties, without limiting it to a subset of homes.”

He said that any existing properties should be grandfathered.

“Labor has got it right to grandfather existing investment properties, a policy I strongly stand by. Without this, it could lead to property Armageddon.”

Labor’s negative gearing policy can be found HERE.

Labor’s negative gearing to hurt those it aims to help most, warns network CEO
doug driscoll new reb 1
lawyersweekly logo
Recommended by Spike Native Network
Do you have an industry update?
Ensure you never miss an issue of the Real Estate Business Bulletin. Enter your email to receive the latest real estate advice and tools to help you sell.