Labor is going to the federal election with a risky housing tax policy that will exacerbate already falling house prices, force up rents and threaten the broader economy, says a real estate agent.
Ray White Victoria Point Michelle Cattran said Labor's strategy was to halve the capital gains tax discount and restrict negative gearing to new properties.
This ignored economic reality and was misleading Australians about who would really benefit.
"Under Labor's plan, property investors wishing to buy older style properties will be prevented from claiming interest payments against their incomes, and the capital gains tax break they currently receive would be halved," she said.
"A Property Council of Australia survey has shown that nine per cent fewer investors will be prepared to buy new properties, if Labor's proposed crackdown on negative gearing is implemented.
'If Labor wants to treat property investing differently from all other forms of investment, it's ordinary Australians that will pay the price.
"Property investors will no longer be in a position to access the kinds of taxation benefits they currently enjoy, fewer rental properties will be bought, rents will go up, house prices will fall, and negative gearing benefits will be restricted to top end of town - sharebrokers and bankers who negatively gear shares."
Labor Bowman candidate Tom Baster did not respond to questions on the issue from the Redland City Bulletin.
A Labor policy statement says its move to reform negative gearing and the capital tax discount is aimed at helping put the Australian dream of home ownership being back within the reach of middle and working class families.
It says that for most young families, the dream of buying and owning their own home is almost out of reach.
Ownership rates for people 25 to 34 have spiralled downwards from 60 per cent to 48 per cent, with young people being forced to take on debt unimaginable just a few decades ago.
It says that with first home buyers making up just one out of seven of all home purchases, the nation have to do better.
Ms Cattran said that when former PM Paul Keating experimented with negative gearing in the mid 1980s, rents increased and the policy was dropped.
"Analysis has shown, time and time again, that scrapping negative gearing will have negative impacts," she said.
"Two thirds of Australians with incomes under $80,000 use negative gearing to save for their futures, not the top end of town as voters are being led to believe.
