General New Zealand Election 2020

[Juju]

If the government was truly wanting to fix the housing crisis, they should stop giving Kāinga Ora blank cheques to buy whole developments such as the one by the Temple in Flat Bush at prices inflated above what first home buyers and investors can afford.

They should also get Kāinga Ora to change it‘s policy which limits who can build in their private/public subdivisions which has forced many builders to compete for in fill sections and pushed up the value on the existing housing stock.

They should also abandon their policy of encouraging local councils to change planning rules to do away with minimum lot sizes.

But, no, it’s far easier to play the blame game and do a tax grab than to look at how their own policies.

Of course building more houses is really the only answer.
I'm not even going to bother defending the government at all. They are underwhelming 100%.

But of course making property investing a less attractive proposition is a good idea.

Investors remind me of the NRA gun people in the states... thinking whats best for them is a god given right...

 

[Miket12]

Of course building more houses is really the only answer.
I'm not even going to bother defending the government at all. They are underwhelming 100%.

But of course making property investing a less attractive proposition is a good idea.

Investors remind me of the NRA gun people in the states... thinking whats best for them is a god given right...

The fact is, we are in the middle of a FOMO led cycle. The real change will only occur when the reverse FOMO kicks in and the market becomes flooded with properties people want to sell in case they miss out of the capital gains they’ve recently enjoyed.

Then, in a while, the supply will start to drop of again, competition for fewer houses starts again, FOMO kicks in again, values sky rocket and we’re back here again talking of a housing crisis.

Another thing that will slow down the market is when interest rates eventually rise again and the returns from other investments looks brighter than residential property. At the moment, when you can get 100% gain on your money through a leveraged property, why have that money in the bank earning less than 1%.

 

[wizards rage]

$15k paid in interest on mortgage. The tax on this at mentioned rate is $4.5k. That is the amount offset.

Let’s take an example where Bob buys an investment property for $1,000,000 with an $800,000 mortgage and it’s cashflow neutral.

9 years time he sells for $1,100,000 due to capital gains.

He must pay 30% tax on his $100,000 gain = $30,000. Profits are $70,000.

For 9 years his previously neutral property now pays tax on $24,000 interest ($8,000 per year x 9 years = $72,000 in tax paid - currently this was $0.

$70,000 capital gain, less $72,000 cashflow losses, leaves a $2,000 overall loss... badly designed policy where potentially a real loss but with tax paid of $102,000. That’s over 100% tax... Huge tax on no profit! This doesn’t even allow for inflation..

It’s a dog of a set of changes and how it will work in practise has not been thought through at all! I don’t think Robertson with his arts degree has the capacity to think all this through so it’s STUPID to make significant changes to tax policy without IRD support and analysis.

 

[Juju]

Let’s take an example where Bob buys an investment property for $1,000,000 with an $800,000 mortgage and it’s cashflow neutral.

9 years time he sells for $1,100,000 due to capital gains.

He must pay 30% tax on his $100,000 gain = $30,000. Profits are $70,000.

For 9 years his previously neutral property now pays tax on $24,000 interest ($8,000 per year x 9 years = $72,000 in tax paid - currently this was $0.

$70,000 capital gain, less $72,000 cashflow losses, leaves a $2,000 overall loss... badly designed policy where potentially a real loss but with tax paid of $102,000. That’s over 100% tax... Huge tax on no profit! This doesn’t even allow for inflation..

It’s a dog of a set of changes and how it will work in practise has not been thought through at all! I don’t think Robertson with his arts degree has the capacity to think all this through so it’s STUPID to make significant changes to tax policy without IRD support and analysis.

Lol 9 years and a $1m property went up $100k...

 

[wizards rage]

Another thing that will slow down the market is when interest rates eventually rise again and the returns from other investments looks brighter than residential property. At the moment, when you can get 100% gain on your money through a leveraged property, why have that money in the bank earning less than 1%.

This is the real issue - reserve bank fuelled asset bubble to jumpstart the economy. It’s not just property but shares as well.

the police is directly linked to interest rates. 20 years they have been going down and house prices have risen. When they go up, like a set of scales, the prices will drop.

 

[wizards rage]

Lol 9 years and a $1m property went up $100k...

What if it does? What if the value goes down?

You watch when interest rates eventually rise again...

Look overseas at Japan, the US or Germany as examples.

A tax system allows for and is fair for all eventualities - a one sided tax is just a envy tax.

 

[Juju]

What if it does? What if the value goes down?

You watch when interest rates eventually rise again...

Look overseas at Japan, the US or Germany as examples.

A tax system allows for and is fair for all eventualities - a one sided tax is just a envy tax.

What does the equation look like if 9 years ago they purchased a house for $1m and sold it for $2.6m?

 

[wizards rage]

What does the equation look like if 9 years ago they purchased a house for $1m and sold it for $2.6m?

A shit load more tax than a first home buyer who makes the same capital gain .

Wait until they close that loophole

 

[Miket12]

A shit load more tax than a first home buyer who makes the same capital gain .

Wait until they close that loophole

And then they’ll look at the untaxed capital gains people have made on their KiwiSaver accounts... or that mint ‘69 Mustang.... or the artwork by the artist seen by many as the next “Banksie“ you picked up for $50 at a garage sale.

Don‘t worry, Luxon will lead National to victory at the next election and repel that interest on mortgage part of the legislation.

 

[dean]

From the narrative we repeatedly hear, you would think people with a rental property or two pay little to no tax or receives huge tax refunds each year.

You would need quite a large portfolio and be a top income earner to be in that category.

 

[dean]

And then they’ll look at the untaxed capital gains people have made on their KiwiSaver accounts... or that mint ‘69 Mustang.... or the artwork by the artist seen by many as the next “Banksie“ you picked up for $50 at a garage sale.

Don‘t worry, Luxon will lead National to victory at the next election and repel that interest on mortgage part of the legislation.

Please not Luxon. A god walloper imposing his morals (or lack of ) on us.

 

[Inruin]

Hypothetically, what would be considered a fair return for an investor providing the service of accomodation through a rental property? I mean from both sides of the argument. As I see it there are the evil investors who provide the service and make disproportionate profits. Without them there becomes a bigger shortage of accomodation and no one 'wins'.

How much is attractive enough? How much before it becomes too much for providing the service?

 

[Juju]

A shit load more tax than a first home buyer who makes the same capital gain .

Wait until they close that loophole

I really don't know what's funny about a generation & social class being completely cut off from owning a property...

 

[Juju]

And then they’ll look at the untaxed capital gains people have made on their KiwiSaver accounts... or that mint ‘69 Mustang.... or the artwork by the artist seen by many as the next “Banksie“ you picked up for $50 at a garage sale.

Don‘t worry, Luxon will lead National to victory at the next election and repel that interest on mortgage part of the legislation.

Factious again... Does anybody really have a issue with people speculating as a whole? No... but when its speculating on a basic human requirement I think its fair game to make that unattractive....

 

[wizards rage]

I really don't know what's funny about a generation & social class being completely cut off from owning a property...

My kids will be able to get a property... Just not in Auckland.

A 25 year old staff member at work took possession of their first home last Thursday. They earn a below average wage but don’t live excessively. DINK’s.

 

[wizards rage]

I really don't know what's funny about a generation & social class being completely cut off from owning a property...

Your for a capital gains tax on first home buyers as well?

You do know lots of countries have a CGT and it doesn’t bring the prices down or make them more affordable anywhere!

Supply and demand - answer is more houses

 

[Juju]

My kids will be able to get a property... Just not in Auckland.

A 25 year old staff member at work took possession of their first home last Thursday. They earn a below average wage but don’t live excessively. DINK’s.

Do the maths on a couple earning $120k all up (above average wage) - with no family help. Saving a deposit while renting. Tell me where they will buy with a national media of $800k plus.

Where did this mythical 25 year old buy? and did they have family help?

As I really cannot see average earners being up to buy without help from family being the norm very soon

 

[john nick]

And then they’ll look at the untaxed capital gains people have made on their KiwiSaver accounts... or that mint ‘69 Mustang.... or the artwork by the artist seen by many as the next “Banksie“ you picked up for $50 at a garage sale.

Don‘t worry, Luxon will lead National to victory at the next election and repel that interest on mortgage part of the legislation.

Sorry Mike but we dont need the second coming of Muller.That didnt work out well for Nats or NZ

 

[Juju]

Your for a capital gains tax on first home buyers as well?

You do know lots of countries have a CGT and it doesn’t bring the prices down or make them more affordable anywhere!

I'm for CGT on investment properties - I never mentioned first home buyers.

Like I said earlier supply is an issue but making property less sure fire is a start.

 

[wizards rage]

Do the maths on a couple earning $120k all up (above average wage) - with no family help. Saving a deposit while renting. Tell me where they will buy with a national media of $800k plus.

Where did this mythical 25 year old buy? and did they have family help?

As I really cannot see average earners being up to buy without help from family being the norm very soon

Tauranga in an average suburb. $560k purchase price. Pretty run down but it’s a first home. They have both contributed 8% to KiwiSaver. She earns $22ph. Him about $30ish? I’m pretty sure they almost lived on one income and banked the other.

They lived with flatmates prior to buying and paid about $220pw rent by sharing costs.

No family help but saved for years. Also did some weekend work for extra income.