Melton Under The Labour Party, their proposal could potentially mean that property prices would drop and rental prices would rise. Whereas proposes with The Liberal Party, prices would stabilize and rental prices wouldn’t fluctuate much. This would affect individuals in different ways, depending on where you are in your property journey.
Renters
Under The Labour Party, there will be fewer people investing in property due to negative gearing changes. This means that the number of rental properties will drop and as rentals will be more in demand, rental prices will increase and it will be made very difficult to find a rental. Even small increases in pricing can be problematic given that renters tend to be younger, have less money and are more likely in housing stress.
First Home Buyers
First home buyers are the group that would actually benefit from The Labour Party being elected. The negative gearing changes will force property prices down, and although this will give first home buyers a better chance at affording to buy a home, it’s terrible news for anybody already owning a property as they could lose money on their asset.
Investors
The Labor Party will only allow new properties to be negatively geared from January 1st, although existing negative gearing properties will be able to remain so. Most investors prefer to invest in existing homes rather than new homes due to wear and tear, etc. This would be particularly bad for first time investors looking to buy after January 1st, considering many investors heavily rely on negative gearing to make a low yielding investment attractive.
Source: Nerida Conisbee – Realestate.com.au
