Changes to negative gearing and capital gains tax have already triggered a sharp pullback in investor demand for property. Msquared Capital Co-Founder and Fund Manager Paul Miron warns property prices could fall materially more than 10% if clearance rates keep trending below 50%.
In his view, the real drivers of Australia’s affordability crisis aren’t negative gearing, but unsustainable migration levels, slow planning approvals and a challenged construction sector. To solve the housing supply crisis, he points to Canada, where reducing migration intake 20% has already eased rents and housing-driven inflation.
Miron also flags a knock-on risk closer to home: grandfathering rules will discourage landlords from selling, dragging down property turnover and the stamp duty revenue states rely on to fund essential services.
Key points:
- Budget tax changes seen as worsening housing supply and rental pressures
- Grandfathering rules viewed as reducing property turnover and state stamp duty revenue
- Canada’s migration cuts cited as a model for lowering rents and inflation
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Msquared Capital Pty Ltd ACN 622 507 297 AFSL 520293. The information provided is general in nature and reflects the views of the speaker at the time of recording. Forward-looking information is inherently uncertain, and actual results may differ materially from projections. The information has been prepared without taking into account your objectives, financial situation or needs, and does not constitute personal financial product advice, investment advice or a recommendation. Before making any investment decision, you should consider whether the information is appropriate to your circumstances and seek independent financial advice.
