Western Sydney University expert weighs in on the negative gearing debate
With the debate around negative gearing back on the national agenda as a possible way to deal with the housing crisis, a Western Sydney University academic provides expert comment on the issue.
Writing in The Conversation (opens in a new window) today, Associate Professor Michelle Cull from the University's School of Business said the real issue of housing affordability is multifaceted, and any change needs to be done as part of a broader policy.
She said policy discussions around housing affordability and availability invariably lead to suggestions to change how negative gearing and capital gains tax operate.
Acknowledging taxation policy is not the only solution available, Associate Professor Cull discusses that other suggestions currently in play also don’t hit the mark.
“Accessing superannuation for a home deposit is not viable for low to middle income earners, regardless on one’s stance on accessing the funds before retirement,” she said.
“These households are unlikely to have substantial superannuation balances. Also, they don’t have the earning capacity to service a mortgage for the outstanding amount.”
Associate Professor Cull calls out what's missing from the public debate are the voices of the people that housing policy is meant to assist - low to middle income earners and young people.
"It is likely that on its own, changes to negative gearing and/or capital gains tax will not achieve the intended outcome to make housing more accessible and affordable for Australians who want to buy a home," she said.
"While the debate around the best way to achieve housing affordability and accessibility continues, and while there are statistics that tell us about the current housing crisis, one crucial thing that is missing is the voice of the very people that any new housing policy should be designed to assist.
"More consultation is needed with younger age groups and low to middle income earners who are struggling with high rent and unable to purchase their own home.
"Australia desperately needs bold new innovative housing policies that do not rely solely on the taxation system but that consider a raft of measures that meet the housing needs of everyday Australians."
Read more about Associate Professor Cull's analysis on the issues of negative gearing and housing affordability and availability in The Conversation (opens in a new window).
ENDS
26 September 2024
Photo credit: Audi Choiron via Unsplash
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