Protection against negative gearing changes

Protection against negative gearing changes

Negative gearing changes have been proposed almost on regular cycle over the last 13 years I have been a Property Investor and Property Strategist (and indeed the rules were changed by Paul Keating for a short time before a political revolt).

On the pro negative-gearing side you hear changing the rules will be death of Property Investing and force rents to rise. You hear that the average Australian will be robbed of the opportunity to grow their wealth or that changes will cause a property crash.

On the anti-negative gearing side you hear others say that negative gearing encourages speculative property investing, that is favours only the rich or that property investing has an unfair advantage over other types of investments like shares.

There is a little truth and a lot of emotional debate on both sides and that creates uncertainty and risk – both of which are not good when investing.

What will the changes really mean?

Both major political parties are talking about changes. Without a crystal ball, knowing whether either of the parties have the numbers to actually get any legislative changes through or whether they really have the political will to actually make changes to the negative gearing “sacred cow” its impossible to know.

That means you could keep on negatively gearing your property investments, with a “head in the sand” view and hope that changes don’t actually happen.

Or you could take the time to consider if negative gearing is actually the best strategy in the medium to long to term with all the talk about changes (and the real possibility of interest rates rising rather than falling).

A different approach.

Perhaps now is the time to consider the alternative approach of what has often been termed Positive or Neutral gearing.

The strategy of building your wealth through the right property investment without relying on huge tax breaks to fund your investment.

Can you really Invest in Property without Negative Gearing?

The simple answer is yes. The more complicated answer is that you need to understand the process and your current Property Investment situation.

But “positively geared” investment opportunities are available every day if you know how and where to find them.

No matter whether you have a portfolio that is negatively geared and you need some positively geared property to “balance” the portfolio. Or if you are just starting out and are concerned about buying an investment property and uncertain about what the future holds for changes to the negative gearing rules and interest rates.

With the right process in place that starts with understanding your Financial Fingerprint (your own personal circumstances), through to truly understanding the Right Numbers of a Property Investment you can find to the right Positively geared Property to suit.

So take a moment to consider whether you want to take the risk away and I’m sure you will come to the conclusion that the right property investment in these times is an investment not only grows your wealth, but protects you against Negative Gearing changes by being “positively geared”.

For an obligation-free discussion on how to find the right property investment for your own financial fingerprint you can contact on us on (02) 8814 5275 or check out our free videos, checklist and other resources at www.mirren.com.au/resources