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Housing policy goals:

  1. Work toward 7 out of 10 Australian households owning their own home outright, by the time the main breadwinner is 35 years old.
  2. Reduce the demand boosters and supply restrictions each time quarterly house prices rise by more that the equivalent of 3% per annum, per quarter (the upper limit for the RBA target inflation rate).

Housing policy submission to the affordable housing inquiry

To view the Taxpayers Party submission to the 2014 Senate affordable housing inquiry, click here. The purpose of the submission was not so much to say, ‘do this and do that’, it was an attempt to communicate to Tony Abbott, that, a Liberal Government should not dismiss the idea of affordable housing out of hand and that the very idea of affordable housing is inline with their worldview as it supports business, the economy and reduces the need for subsidies and handouts. Luckily, affordable housing policy was already written into their party constitution!

View on being a Housing Investor:

Investing in residential housing involves outbidding a potential home owner. Therefore, investing in residential housing by purchasing a house/unit to let, physically prevents an Australian from purchasing their own home. Therefore, the act of investing in residential property directly moves Australians away from their dream of home ownership.

Purchasing a property to let that has negative cash flow is not an investment, it is making a loss now in the hope that high immigration and increased debt from the banks will help raise house prices in the future.

Can you think of another investment class in Australia where the act of investing in the business drives up the price of the product? If you buy shares in a supermarket on the stock exchange, does that action drive up the price of food offered by the supermarket? If you buy shares in an electricity retailer will that drive up the price of electricity for consumers?

View on Negative Gearing:

When an individual purchases a residential property to rent out and that investment is losing money each month because the rent received is less than the costs from the mortgage/fees etc, negative gearing rules permit the individual to deduct that loss against their wage. Therefore, negative gearing rewards individuals who have made the decision to invest in an activity that loses money, in the hope that higher future house prices will provide the desired profit.

Negative gearing in Australia for both shares and property should be progressively abolished.

View on the First Home Buyers Grant:

The First Home Owners Grant (FHOG) uses taxpayer funds to help all individuals who are purchasing their first home. This extra injection of cash helps to raise the price of housing by increasing demand.

The First Home Owners Grant should be progressively abolished.

For an argument against the first home owners grant click here.

View on voluntary reporting of house & unit sale prices:

Currently, real estate agents only report house and unit sale results if it suits them. Therefore, buyers to do not have access to accurate and timely information regarding the real market price of residential properties currently offered for sale.

Would it be acceptable if the Australian stock exchange only reported some of the recent stock market transactions for each company and had the ability to only report transactions that it thought were a good result?

Reporting of house & unit sale prices should be compulsory with the data available for free

The following must be reported within 48 hours of the event occurring (the suggestion came from here):

“1. The property is first available for sale.

2. The sale price once the property is exchanged after all cooling off periods plus the sale date, number of bedrooms, street & suburb.

3. If the property is withdrawn from the market.

4. A new rental lease; date the new lease begins, date the last one expired plus the new rental amount less incentives.”

For an article regarding the use of house price sale data click here

View on selling our houses to foreign buyers:

Ensure only Australian citizens can purchase residential property in Australia

This involves the forced sale of all residential property owned directly or through other entities (trusts & companies etc) by individuals who are not Australian citizens.

Housing policy to-do list:

  1. Progressively phase out negative gearing over a period of time, say 10 years.
  2. Prevent any new investors from claiming deductions due to negative gearing.
  3. Make the reporting of house & unit sale price results compulsory, and provide that data for free via an electronic means.
  4. Progressively abolish the First Home Owners Grant.
  5. Progressively phase out stamp duty and replace it with a broader based tax such as GST/income tax/council rates.
  6. Force the sale of all residential property owned by individuals who are not Australian citizens
  7. Progressively raise the minimum deposit required for a mortgage back up to 20%
  8. Remove the ability of superannuation funds & SMSF to purchase existing residential real estate in Australia
  9. Adjust the capital gains tax concessions so that there is no rational incentive to preference investing in real estate

The above would need to be done slowly while avoiding a deflationary scenario.

Q: Does that mean we would support releasing enough land to satisfy demand?

A: Before considering this as an option, minimizing the negative impacts of urban sprawl is desirable.

Own your home.