Negative Gearing changes will hit WA renters hardest

19 Mar 2019| Posted by: Geoff Baldwin

If elected, which no seems a fait accompli, Bill Shortens proposed changes to negative gearing and capital gains tax will significantly affect the Australian rental market but WA tenants are in for the hardest hit according to RE/MAX WA MD, Geoff Baldwin

With local rents already on the rise, the vacancy factor below 3% and the number of properties available for rent almost half of those available 12 months ago, slashing negative gearing and increasing capital gains tax will be the final nail in the coffin for renters.

Having worked in the investment property sector for more than 3 decades I remember clearly what happened when Paul Keating decided to do away with Negative Gearing in the late 1980’s. Investors deserted the market reducing the number of available rental properties and this forced rents to go through the roof. Within 18 months that Labor government reversed their decision and reintroduced Negative gearing. Unfortunately history is set to repeat itself unless there is a late change of policy which is doubtful.

The Labor proposal has already injected huge levels of uncertainty into our market however, right now in WA, our overall market is just holding its own and if anything, investors need incentives to provide more rental accommodation, not more roadblocks, Mr Baldwin said.