If you need a reliable, accurate, thought provoking and informed economic forecasting at both local and international levels, look no further. Informed by Stephen's exceptionally broad experience and background, his
Prime Minister Malcolm Turnbull will be on Q&A tonight and let’s hope that at least a few of the questions cut to the key points of economic management. With the economy confronting a range of economic challenges, here are nine questions that Mr Turnbull should be asked.
Why negative gearing makes little difference to house prices
Negative gearing makes little difference to house prices.
Other factors such as new construction, demand from population growth, the unemployment rate and the overall business cycle are far more important determinants of house price changes than tax rules. One only has to look at the recent capital house price trends for unambiguous proof.
Since January 2015, Sydney house prices have risen by around 20 per cent. Over the same timeframe, Perth house prices have fallen by around 9 per cent.
This massive 30 per cent differential between Sydney and Perth house prices in just 18 months, has occurred with the existing negative gearing and capital gains tax laws in place. Nothing has changed in tax policy over that time. Quite plainly, something other than negative gearing rules are impacting on house prices.