Labor Neg tax policies will damage poorer lower & mid priced suburbs most

13 May 2019| Posted by: Geoff Baldwin

Policies proposed to be introduced should Labor win government on May 18 will most certainly cut investor activity in established real estate almost immediately however the suburbs that will be damaged most are those in the lower to mid price ranges, according to RE/MAX WA managing director, Geoff Baldwin.

Many of these suburbs are in seats that Labor is attempting to win or where they already sit so in introducing these new policies it could be argued that they are hurting their own support base most.

Of course they will also have a downward affect on prices in all seats including those held by the Liberals after the election but it is the lower priced suburbs that will be most negatively affected.

Suburbs with lower to mid prices tend to be the ones targeted by investors as they have the highest rental demand and the best percentage (rental income compared to price) return.

Increasing capital gains tax and taking away the negative gearing advantages foe investors, especially mum and dad investors who make up most of the market, will lessen demand and further damage prices in these suburbs that have already been through hard times and significant drops in value over recent years.

Property owners in these suburbs should consider this as they go to the polls as a Labor or greens vote could have a substantial negative affect on their equity over the next few years.