The Australian Labor Party has said that it is concerned that first home buyers make up just 1 out of 7 of all home purchases in Australia and ownership rates for young people aged 25-34 have spiraled downwards in recent years from 60% to 48%.
The reality in Australian with housing affordability is that investors in Australia have an unfair advantage because they can access some of the most generous tax concessions on housing in the developed world. Last year, for the first time in history, more than 50% of all new home loan approvals were for investment purposes.
Labor’s plan will reform negative gearing and capital gains tax to make sure the housing market works for all Australians. These reforms are about putting some fairness back into the housing market, and making improvements to the Budget bottom line.
With the reform to negative gearing, Labor has said that all existing properties purchased prior to 1 July 2017 will be unaffected by these changes. are fully grandfathered – and therefore, unaffected.
The reforms for negative gearing and capital gains tax are set to deliver $32.1 billion in savings. According to Labor, these savings will help fund other reforms like Labor’s Your Child. Our Future, which is a plan to boost schools across Australia.
Labor has said that the proposed reforms to negative gearing and capital gains tax are their plan to make sure the housing market works for all Australians.