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The head of a property investment consultancy has welcomed the federal government’s decision on negative gearing, but says the issue of housing affordability still needs to be addressed.
Momentum Wealth managing director Damian Collins says the Turnbull government’s decision to leave negative gearing untouched is a win for both property owners and renters.
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“Tinkering with negative gearing puts the financial future of millions of Australians, and the broader economy, at risk, which is why it’s crucial to leave the existing structure as is,” Mr Collins said.
“In addition to the millions of property owners and renters that would be affected by changes to negative gearing, another 1.1 million Australians who are employed in the property sector would also be impacted, causing uncertainty in one of the nation’s biggest economic contributors.
“Negative gearing allows average Australians to grow their nest eggs through property investment, and also works as a rent subsidiary for low-income earners and those not yet ready to purchase a house.”
However, Mr Collins said the issue of housing affordability has not yet been directly addressed in any of the Turnbull government’s policies, and he called on all levels of government to take action.
“If governments were serious about improving housing affordability, they could immediately start by taking three simple steps,” he said.
“Firstly, governments could remove taxes on land developers and buyers. Secondly, they could allow more medium and high density housing options in established suburbs. And finally, they could address the high cost of land development for new housing estates.
Mr Collins said taking these steps will dramatically improve housing affordability by allowing “countless” more Australians to achieve home ownership.
[Related: Experts predict effects of negative gearing removal]
