Investment Properties to be reigned in

Cameron Kusher from CoreLogic RP Data talks about reports the Coalition will limit the number of investment properties you can buy

Investment Property To Be Reigned In

Introduction

Ross Greenwood: Great to have your company here on the program. I didn’t get a chance to also ask the prime minister about one other suggestion that could come up into the budget. I think this is completely bonkers, but I’ll let somebody else talk about that.

This is whether the government will try and limit the number of properties that an investor can buy and/or own to therefore limit the amount of tax breaks that people can individually pick up through negative gearing. This is about trying to overcome housing affordability. I mean, how do you do that? Anyway, let’s go to CoreLogic RP Data, Cameron Kusher from there, very good with always these numbers and all this type of thing.

I must admit that Cameron Kusher has been taken to Twitter today. “I think you can make it unattractive, to buy more than a certain number, but you can’t stop people from buying properties.” That’s what he said on Twitter. Cameron Kusher is with me now. Many thanks for your time, Cameron.

Cameron Kusher: Thanks for having me, Ross.

Interview

Ross Greenwood: Is this going to fly or not?

Cameron: I can’t see how it’s going to fly. Obviously, as you said in the intro that you can’t really stop people from buying and selling properties, but what you can do is disincentivize people from buying too many properties. I think a more likely solution is to provide some sort of cap on the amount of loss you can claim across your properties, but saying to people that they can only own, say, four or five properties, I don’t know how you’re going to police that.

Ross Greenwood: How many properties does Harry Triguboff – last year, the wealthiest man in Australia worth $10.6 billion – how many properties do we imagine he owns?

Cameron: Well, he’d own quite a lot, and we know —

Ross Greenwood: If the government said, “You can own four,” that’s a bit of a problem if you’re one of the wealthiest people in Australia who’s built their wealth out of building houses and apartments.

Cameron: It’s a huge problem. To be perfectly honest, it’s going to be a problem for some of the politicians as well.

Ross Greenwood: What would you say to Barry O’Sullivan from the Liberal National Party in Queensland? He owns 16. He’s number one in the parliament for properties owned.

Cameron: Exactly. These people are not going to be in a position of — I can’t see how politically they’re going to get this across the line, that they can say that people are only going to be able to own a number of properties. As I said, the more likely solution is to put a cap on the deductions that people can claim from their investment properties, but, again, politically that’s going to be a difficult thing to get over the line.

Ross Greenwood: How can you possibly say to one person who’s got a property company – let’s say we’re talking about Mirvac Building, they must own a stock of properties – “Well, you can actually own as many as you like, but, sorry, you, the battler who’s a police officer or an ambulance driver or something who we know are most likely to be negatively gearing properties, you’re limited to three or four,” or whatever it might be?

Cameron: It is. It really is a bit of a nonsensical proposal, from my perspective. Why should property be treated differently to, say, shares or any other investment class as well? The proposal, really, just makes the system even more distorted than it is at the moment. To me, I don’t think it’s one that we’re going to see get up.

Ross Greenwood: I don’t think it’s going to get up either. You’re quite right. You can negatively gear as many shares you like in Mirvac, which owns as many properties as it possibly likes because it’s a company, but then the government says, “Well, you’re limited from only owning three, four, five – whatever it might be – properties.” It is not going to fly. Cameron Kusher from CoreLogic RP Data. As always, Cameron, we appreciate your time and your pithiness about this.

Cameron: Thanks very much for having me, Ross.

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