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Experts respond to PM’s claims Labor policy could spark ‘housing market crash’
news.com.au September 20, 2018
Alexis Carey
PRIME Minister Scott Morrison has slammed Labor’s bold plan to fix the housing market, with the ominous warning it could “invite a housing market crash”.
But while the Coalition has poured cold water over the Opposition’s promise to limit negative gearing and halve the 50 per cent capital gains tax discount, it has ignited fierce debate among leading property experts and everyday Aussies alike.
News.com.au spoke to some of the country’s biggest names in real estate to get their take on what has become one of the hottest topics in the country.
Here’s what they had to say.
Not parody and not the Onion: the Real Estate Prime Minister says that cutting back the tax rorts that totally didn't cause house prices to rise will cause a housing crash. Also, how can the housing market crash if there is no bubble?
THE DATA SCIENTIST
Martin North of Digital Finance Analytics told news.com.au the Prime Minister’s claims were a blatant exaggeration.
“Morrison is alarmist on this. The facts are that Labor is only looking to limit new negative gearing on existing property — not retrospective,” he said.
“The volume of investors buying new investment property is way down, thanks to the slowing capital growth in many centres.
“Those who are still in the market, according to our surveys … are mainly going to the deeply discounted new developments now and many of which are offering rental guarantees for specific periods, in a desperate attempt to sell.”
He said existing investors would not be impacted by Labor’s proposals.
“Morrison is, I think, trying to deflect attention away from five years of bad housing and economic policy — driven by consumer debt expansion and over-free bank lending,” he said.
“This is playing politics, not dealing with the core issues we face, which is how we manage the mortgage debt bomb, as mortgage stress rises.”
He said the Reserve Bank’s rates policy had been “wrong” for several years and the gross domestic product was supported by inflating household consumption on the back of artificially high home prices and growing debt.
