A 100m2 house built in say 1970 for $10,000 and properly maintained (maintenance costs being deductible) would now be worth maybe $100,000 (or more, as this is only about half the cost to build a 100m2 replacement). So the well maintained building actually rises…

Depreciation makes sense and should be applied across the board.

Depreciation makes no sense on property. Depreciation is for assets like cars or computers that you get rid of after X years and replace with a new one. By allowing depreciation on property you are basically saying "run this into…

DFC

The decision to sell the Crown's 100% equity investment in DFC New Zealand Limited, New Zealand's largest investment banking organisation, was announced in the July 1987 Budget. On 28 June 1988 a sale and purchase agreement was signed between the Crown and…

I agree that everything is always full of shit in all sorts of ways.

All shit is equal. But some shit is more equal than other shit.

Seriously though, when DFC went under, nothing ever came close to replacing it. Not even the VIF or the most ardent angel investors.

I consider the main reason for the tax change on rental property is not social equity or fairness to tax payers. It is to provide a disincentive for people to invest in property and the rationale behind it all is that it will move those…

I have the firm impression, that the Property Managers using a zero letting fee are seeing the bond as theirs.
This was a common practise in Oz a few…

He said his business, which had sold website translation systems to the European Union, provided jobs, export dollars and big growth potential. Yet it could not get money from banks and had been forced to…

Depreciation makes sense and should be applied across the board.

For things that have short lives and single owners, perhaps. If a house lasts say 50-100 years before it needs replacing, then what would be an appropriate rate per year? And how will that help the owner of the asset…

In summary, rents are constrained by demand, so it will be property prices that move.

Demand is also a function of market expectations. It seems ours are being softened up so that the balance of fallout between tenants and landlords is shifted more towards tenants than a pure market might…

Just a thought. It's not all "sell to someone…

Would this option work? Scrap the LAQC option. Losses are kept in the company (at the moment they can be applied to shareholders tax bill (ie, refund), same as a profit is applied to the tax bill).

So, after 5 years, my company with…

However, that doesn't change the fact that our system has a *huge* bias in favour of taxing workers over capital owners,…

Not exactly your standard 2 bedroom flat in the suburbs.

Certainly isn't, Garry — which was kind of my point. If One wants to run propaganda on behalf of lobbyists disguised as news, they should try picking their sob sisters with more care. (Like the "it's so unfair I this…

Could this not put downward pressure on the rental market?

This article infuriated me.

It didn't so much infuriate me as bemuse me, because there didn't seem to be any point to it apart from to let someone have a whinge in the national press. And why did they want to have a whinge? Well:

property investors are maligned in…

If the law deemed a purchase to have been made "with the purpose and intent of resale" if the house were sold within x (say three) years of the date of purchase

Why three years? What difference does the term make?

Rents in NZ are at a discount to mortgage…

Ah, yes... The story where the photogenically pathetic Kiwi Battler from Struggle Street ended up saying that "going out less often" would be an option.

Craig, Your struggle street battler was living in a rather nice low rise art deco block on Oriental Parade called Fountain Court, descibed in a…

is anyone going to mention the fairly obvious "solution"?

stamp duty or CGT.

Actually, it's even easier than that. Change the law to have a bright line rule on what constitutes "flipping", as people have called it here. At the moment, it's subjective and easily disputed. The law provides for…

Or to someone who's back from overseas, or just moved to Auckland, or was living with their parents, or has split from their long-term partner...

[Puts on Harry Potter costume, takes out magic wand]: "ceteris... paribus!"

Of course when you add more people to the housing market, more people are…

stamp duty or CGT.

You make a profit, you pay some tax. easy. except
it needs to be on investments and personal sales.

and there is no chance of that happening. can tax the battlers because their house price went up.…

The CAP costs Europeans 100billion Euros against a GDP of 12 trillion, so something under 1%.

Hence it's pretty sustainable, and a reasonable trade off for food security (one must remember that starvation is an actual living memory for people in Europe) and maintenance of landscape values.

Sure it's good…

deprecation wasn't real money because they have to pay it back

no, "deprecation" is what *we* should be giving *them*, innit.

Hence it's pretty sustainable, and a reasonable trade off for food security (one must remember that starvation is an actual living memory for people in Europe) and maintenance of landscape values.

Or to someone who's back from overseas, or just moved to Auckland, or was living with their parents, or has split from their long-term partner...

Which, aside from net migration and intra-national population movement, gets balanced by people who move overseas, leave Auckland, die, or get it together with someone.…

Again, that sense of entitlement justifies my comparison with the Common Agricultural Policy. And not a single mention of paying any tax either.

At least our landlords are only fucking up our economy, whereas the CAP fucks with a lot of the rest of the world – us included. Other…

If landlords sell up and get out of the rental market, they must be selling the house to *someone*. Either it's someone who's currently renting, or it's someone currently a owner-occupier, in which case *they* have to sell their house to someone, who could be currently renting, etc.

Or to…

I think overcrowding mainly occurs because people are living in damp converted garages waiting for Housing New Zealand properties they can afford to pay the rent on...

I also think it's fair comment to point out that Housing New Zealand isn't going to put you on the [[http://www.hnzc.govt.nz/hnzc/web/rent-buy-or-own/rent-from-housing-new-zealand/waiting-list.htm|A-or…

So, yeah, it'll probably make rents go up

In the short-medium term I think an increase is pretty much certain, and probably one that's above the rise actually indicated by economic factors. In the medium term, and definitely in the long term, it'll all settle out and we'll see a…

@Grace: yup,maintenance of my laptop is tax deductible, too, but after a while, it's not suitable for the job – hence depreciation.…

...are you saying they (landlords) will use dodgy reasoning to hike rents if any cost is passed on to them and that Trev is in support of this ?

I'm saying that:

a) They'll pretend the cost is more than it actually is.
b) There's a limit to what they…

I'd like to see some figures on how much depn is actually clawed back, I bet it's a small % of what is claimed as deductible.

Writing the OIA now...

Yeah, what Glenn said. Flip/hold relates to whether profit from sale of property is taxable or not. Whether you're a landlord (your main business is holding your property so you can rent it out) or a flipper doesn't affect depreciation.

And the rent market isn't a static market. (I…

Or they could choose to tell you to take your out of touch middle class bullshit and just fuck off.

Christ Tom, did you not read the sentence immediately after that?

You just need a small group who is flexible and responsive to price. If they vote with their wallets…

If I buy a property and rent it out, I'll be having to put a substantial amount of money in to cover the mortgage, or forgo interest on that money, which still works out as a loss.

The only conceivable reason for doing that…

Or they could choose to tell you to take your out of touch middle class bullshit and just fuck off.

Well, dear... I suspect "all those people in overcrowded accommodation in South Auckland" are really feeling sympathy pains for that tragically deprived woman on the news last night. OMFG, she…

I couldn't be arsed cos it was too easy and predictable from me to bust a nut on him/her . Nice one though Mr Semmens :)

Maybe we're being primed for churches being next on the taxable hit list ?

On a side note,…

People have choices. If landlords choose to hike their rents, people can choose to live with their parents, move in with flatmates, leave the country, or buy a house.

Wow. Just wow. I am glad the choice is so clear.

I sure all those people in overcrowded accomodation in South…

In straight talk then, can we expect a rent rise to go along with teh GST if this tax package etc go through as is, in the upcoming budget ?

Robbie: Well, the PIF can try it on, but I'd respectfully suggest that pricing yourself out of the market sounds…

Also find myself wondering how defending the rentier welfare state is "for the many, not the few" — unless Mallard is after the Labour nomination for Epsom.

Word – the most depressing part of this is seeing Labour side with the property investors. Way to go, Trev.

I'm not 100% sure you are right on the claw back. In theory, thats how it works, however it's (usually) fairly easy to not have it clawed back, if you buy to hold, not buy to flip.

I thought the flip/hold rule was only applied to the capital gain. The…

Yesterday, 11 March 2010, TVNZ reported:

Ah, yes... The story where the photogenically pathetic Kiwi Battler from Struggle Street ended up saying that "going out less often" would be an option.

Sorry for being a prick, but when I know people who got laid off the week before Christmas, it's…

If IRD can prove (or rather, if we can't disprove) we started with…