Wednesday, April 27, 2016

Top 20 Occupations who use Negative Gearing

If you are working in Australia and you don't even know what negative gearing is, it is likely that your occupation is not one of the top 20 professions taking advantage of the strangely named investment property tax benefit. Negative gearing is the use of an investment property's interest repayments as a tax deduction to reduce the tax payable.

There aren't too many anesthetists and surgeons in Australia but 28% of them use negative gearing. School principals are not too far behind, perhaps because these occupations have the time to look into tax minimisation? The Liberal government decided recently that it is a worthwhile election issue to support the continued practice of negative gearing. The Grattan Institute released a report on Monday which found that the top 10 per cent of earners collect nearly 50 per cent of negative gearing tax deductions and three-quarters of all concessionally taxed capital gains. Only 10% of taxpayers use negative gearing so it is a tax benefit that 90% of the taxpayers fund for the 10% that do. Ouch.. no wonder a recent poll found 73% support Labor's position on removing negative gearing.

OccupationTotal number of taxpayersNumber who claimed rental lossesPer cent who claimed rental lossesAverage rental loss, per claimant ($)Total rental losses claimed ($)
School Principals11,4223,13527.45%10,25832,160,384
Internal Medicine Specialists7,6391,95625.61%20,90440,888,249
Senior Non-commissioned Defence Force Members7,3901,79724.32%8,45315,191,307
Air Transport Professionals14,6503,53924.16%14,61851,733,872
Commissioned Officers (Management)10,6752,52023.61%10,37926,155,407
Finance Managers31,8717,42823.31%12,70494,370,557
Engineering Managers26,6086,11022.96%12,94679,101,081
Mining Engineers9,4712,12722.46%14,24530,299,595
Judicial and Other Legal Professionals2,52856022.15%15,3078,572,296
Dental Practitioners8,5331,86421.84%15,29528,510,546
Other Building and Engineering Technicians22,7994,94521.69%11,49856,861,581
Policy and Planning Managers35,4377,58121.39%10,86382,357,108
Other Hospitality, Retail and Service Managers32,0516,77521.14%10,40270,476,971
Human Resource Managers23,6044,81220.39%9,95047,880,217
Generalist Medical Practitioners27,7135,56520.08%15,28485,055,480
Occupational and Environmental Health Professionals12,0972,42020.00%9,87023,887,482
Corporate Services Managers9,6691,93019.96%11,01421,257,814
ICT Managers60,00911,91719.86%11,701139,442,997
Electrical Engineers22,9444,54719.82%11,80853,693,586

Thursday, April 7, 2016

Rents haven't dropped for 20 years... until now

Would you believe your local real estate agent when they say that the Perth market has bottomed out? Or would you believe the statistics that just came out which indicate rent prices dropping for the first time in 20 years in Australia? CoreLogic RP Data has revealed that Perth dropped in rent price over the last 12 months by a massive 8.4%. Darwin has dropped 11.5%.

It comes a day after an article mentioned that Perth is undergoing a building boom with thousands of inner city and inner suburb apartments going up whilst the population has gone backwards due to the mining downturn. For the year ending June 2013, 77,000 more people came to WA but for the year ending June 2015 population growth had reduced to 33,000 people.
"The most concerning part of the population trend is that it has now been five consecutive quarters where interstate migration has declined. Before this current trend commenced in June 2014, it had been eleven years since a negative interstate migration figure had been produced in WA.
On the housing supply side of the equation, the city normally builds around 18,000 dwellings per year.  Over the last two years, 53,000 dwellings have been approved in Perth. The over-supply pipeline will hang around for at least of couple of years yet.
In July 2013, there were 7,800 properties for sale; today there are 15,200. It’s a similar story with sales volumes – in July 2013, approximately 900 properties were being sold per week and now it’s back to 500 per week." - Why Perth Property Prices will be lower again by year end 

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