It could be a story of the rich getting richer as far as the Sydney property market goes in 2016... International accounting firm Deloitte defends negative gearing...
Eastern suburbs predicted as Sydney's property top spot for 2016
It could be a story of the rich getting richer as far as the Sydney property market goes in 2016.
According to the head of a Sydney based property research firms, it’s likely to be the harbour city’s more affluent suburbs that experience the best rates of capital growth over the next year.
Louis Christopher, head of SQM Research, believes Sydney’s Eastern Suburbs will be the city’s strongest performing region come 2016.
“These areas are the ones that have currently been underperforming, anywhere that homes are $2 million or above hasn’t boomed like the rest of the market has recently,” Christopher said.
“But next year, the affluent areas, particularly the Eastern Suburbs and some areas of the Lower North Shore, are going to be the ones that show the most improvement,” he said.
Christopher predicts prices in the Eastern Suburbs will grow by between 8% - 13%, as the area benefits from the performance of the NSW economy.
“It’s not going to be rapid growth, it could quite possibly be in single digits,” he said.
“The state economy is still running hard at the moment and historically we’ve seen when that happens that the top end of town performs better.
“The other reason is that a lot of investors are shutting up for the moment in Sydney, so a lot of the activity that’s been driving the other areas in the city just won’t be there next year.”
Western Sydney in particular is likely to see a drop off in activity, especially over the short term.
“Since 2010 or so Western Sydney has been performing strongly, but right now I think it’s come to the end of that phase.
“Long term, I don’t think the area is finished, but for the time being I think we’re going to see a slowdown.”
According to Christopher, over the last three years, Sydney’s South West has been the best preforming location for units, with median prices having risen by 52%, while Parramatta has been the best performing are for houses with the median price up by 53%.
While Christopher said some areas of the city will continue to grow, he said Sydney is set to lose its crown as the nation’s best performing market.
“Next year we’re predicting Melbourne to overtake Sydney as the best performing market and for there to be a lot of investment activity there.”
International accounting firm Deloitte defends negative gearing
International accounting firm Deloitte has weighed into the debate surrounding the taxation system surrounding property investment and ownership in Australia.
In their second Shedding light on the debate: Mythbusting tax reform report, Deloitte has defended negative gearing as being no different to the other methods of deduction used by people to reduce their tax burdens.
“Negative gearing is seen as a loophole, with the rich making out like bandits from it,” the report said.
“Yet the ability to deduct expenses incurred in earning revenue is an accepted principle of our tax system – and most other tax systems too.
“It is standard practice to allow taxpayers to claim a deduction for a real economic loss that they incur to earn their income.”
The report also downplays the idea that negative gearing has had an adverse effect on housing affordability, instead claiming that interest rates and other tax arrangements have resulted in prices increasing.
“Interest rates have a far larger impact on house prices than taxes do. Housing prices are through the roof mostly because mortgage rates have never been lower,” the report said.
It could be a story of the rich getting richer as far as the Sydney property market goes in 2016.
According to the head of a Sydney based property research firms, it’s likely to be the harbour city’s more affluent suburbs that experience the best rates of capital growth over the next year.
Louis Christopher, head of SQM Research, believes Sydney’s Eastern Suburbs will be the city’s strongest performing region come 2016.
“These areas are the ones that have currently been underperforming, anywhere that homes are $2 million or above hasn’t boomed like the rest of the market has recently,” Christopher said.
“But next year, the affluent areas, particularly the Eastern Suburbs and some areas of the Lower North Shore, are going to be the ones that show the most improvement,” he said.
Christopher predicts prices in the Eastern Suburbs will grow by between 8% - 13%, as the area benefits from the performance of the NSW economy.
“It’s not going to be rapid growth, it could quite possibly be in single digits,” he said.
“The state economy is still running hard at the moment and historically we’ve seen when that happens that the top end of town performs better.
“The other reason is that a lot of investors are shutting up for the moment in Sydney, so a lot of the activity that’s been driving the other areas in the city just won’t be there next year.”
Western Sydney in particular is likely to see a drop off in activity, especially over the short term.
“Since 2010 or so Western Sydney has been performing strongly, but right now I think it’s come to the end of that phase.
“Long term, I don’t think the area is finished, but for the time being I think we’re going to see a slowdown.”
According to Christopher, over the last three years, Sydney’s South West has been the best preforming location for units, with median prices having risen by 52%, while Parramatta has been the best performing are for houses with the median price up by 53%.
While Christopher said some areas of the city will continue to grow, he said Sydney is set to lose its crown as the nation’s best performing market.
“Next year we’re predicting Melbourne to overtake Sydney as the best performing market and for there to be a lot of investment activity there.”
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International accounting firm Deloitte defends negative gearing
International accounting firm Deloitte has weighed into the debate surrounding the taxation system surrounding property investment and ownership in Australia.
In their second Shedding light on the debate: Mythbusting tax reform report, Deloitte has defended negative gearing as being no different to the other methods of deduction used by people to reduce their tax burdens.
“Negative gearing is seen as a loophole, with the rich making out like bandits from it,” the report said.
“Yet the ability to deduct expenses incurred in earning revenue is an accepted principle of our tax system – and most other tax systems too.
“It is standard practice to allow taxpayers to claim a deduction for a real economic loss that they incur to earn their income.”
The report also downplays the idea that negative gearing has had an adverse effect on housing affordability, instead claiming that interest rates and other tax arrangements have resulted in prices increasing.
“Interest rates have a far larger impact on house prices than taxes do. Housing prices are through the roof mostly because mortgage rates have never been lower,” the report said.
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Would you know a non-conforming client the moment they walked through your door? Chances are you wouldn’t, because they look much like any other client – and like any other client, they want a loan.
