The problem with negative gearing is the 'average person' can't participate in negative gearing.
Negative gearing only works for those who have a high level of income with the corresponding high level of taxation.
Why it works so well for these individuals is they can greatly reduce their tax liability by using the property deductions negatively gearing has to offer.
As a secondary benefit, those same investors also win on the capital gain side of the equation as these negative gearing tax incentives create massive demand for property.
Your 'average person' living on the average wage can't benefit from negative gearing as their wage bracket does not attract a high enough level of taxation.
In fact it hurts this group of people only because those higher property prices also means they are priced out of the housing market.
Negative gearing only works for those who have a high level of income with the corresponding high level of taxation.
Why it works so well for these individuals is they can greatly reduce their tax liability by using the property deductions negatively gearing has to offer.
As a secondary benefit, those same investors also win on the capital gain side of the equation as these negative gearing tax incentives create massive demand for property.
Your 'average person' living on the average wage can't benefit from negative gearing as their wage bracket does not attract a high enough level of taxation.
In fact it hurts this group of people only because those higher property prices also means they are priced out of the housing market.