POLICIES AT FAULT FOR OUR HOUSING CRISIS
RE: “Greedy Owners” ( GA, 15/6), Ian Scott, you are certainly asking the right questions, but you are blaming the symptoms, not the cause.
Excessive negative gearing of “homes” and turning them into overpriced “investment commodities”, with generous taxpayer subsidies and government incentives, is the most sociological and demographic disaster to hit the Australian community.
No, it’s not the “greed of (all) landlords” who have negatively geared, it’s the greed of investors who have negatively geared multiple “homes” and, in doing so, have escalated the cost of those “homes” beyond the reach of most other “home” buyers, now, even themselves!
Added to that is the greed of banks and financial institutions that have provided unfettered amounts of loans to, literally, anyone who applied for them. Yes, a combination of massive greed.
The disaster of the cost of renting is a natural symptom of that excessive negative gearing. The ever-escalating cost of those (what would have been homes) that are now “investment commodities” has to be paid for, and with negative gearing, the bulk of it will have to come from the person who rents the “investment commodity”.
Those investor “landlords” are not “overcharging for rental prices”, they are charging for the over-priced investment! The higher the price of the property, the bigger the loan, the higher the rental!
It’s a double whammy. Those prospective first home buyers who have been locked out of purchasing their first home now have to pay an exorbitant rental to pay the bulk of the loan that the negative geared investor had to borrow to pay for that subsidised, over-priced prospective first home.
What a horrible vicious circle we have created. But, this new government does not appear to be interested in doing anything about rectifying either the cause or the effect, in fact, won an election vehemently opposing any change.
The Opposition got the theory right, but the practice terribly wrong and first home buyers and renters have to continue to pay the price. That’s what you should be complaining about.
Ed Dimech, Torquay