Negative Gearing Still Works
Here to explain Why Negative Gearing Still Works, Bryce puts forward a crucial point, and one we frequently come back to: negative gearing is not a strategy; it’s a tax outcome that represents a moment in time. In other words,
“Negative gearing is a means to an end, not a permanent way of life.”
You can watch Bryce’s video Is Negative Gearing Good or Bad? if you would like a deeper insight into this.
The real question — instead of “Does negative gearing still work?” — should be, “Does residential property still remain a good investment?” In order to answer this, Bryce talks about the significant changes the Australian Prudential Regulation Authority (APRA) made recently, and how these changes have effected lending for property investors.
A small handful of factors discussed in the article include:
One of the biggest “takeaways” from this piece is the answer to the big question — Why Invest in Property in the first place? Click on the picture if you need to hear the fundamentals again or would like to read:
- The Case Study about Rachel, 30-year-old single with a $15,000 deposit
- The Case Study about Matt & Jayne, married with one child, both in their early 40s
Note: Money Magazine had some queries come through from readers. They wanted clarification on how these Case Studies paid down their loan. Well this is where Bryce’s follow-up video (& the influence of an offset account) comes in:
If you want the answers to the real question, this article is well worth the read! And, yes, you’ll get some insights into negative gearing and its historical importance in Australia!
(Want more Case Studies? Click here.)