"Grandfathering" Won't Prevent Negative Gearing Woes

Plans by the Labor party to “grandfather” existing arrangements will not protect property investors from feeling the impact of any changes to negative gearing according to the Real Estate Institute of Australia (REIA).Labor’s proposed property tax reform would see negative gearing restricted to new builds only and the capital gains tax discount halved from 1 July 2017, but investors who have purchased established properties and have them negatively geared before that date would be allowed to continue under the superseded arrangements.But REIA president Neville Sanders said those arrangements will do little to protect investors from market disturbances caused by the proposed changes.“With negative gearing only available for investment in newly-built residential property existing investors will find it more difficult to sell their properties as other investors will show little interest in existing property with inevitable falls in value to follow,” Sanders said.Here more about this on Property Plus - Saturday Morning on StarFM from 8am.