The 2017 Election Thread

[Graystone]

I have no problem with paying tax on profits. In spite of the fact that nobody offers to compensate me for any losses I might incur. I'm magnanimous to a fault. I certainly do have a problem with paying tax on inflation, though. And most of the increase in dollar terms for my investments is easily attributable to inflation.

Sounds like he's got fuck all to whinge about then.

Make better investments then. 'tax on inflation' as you put it is hardly the sole domain of residential property investment, why should it be the only one exempt?

Sounds like your point about being able to buy the same thing for the same money is up to fuck all.

[Ocean1]

Make better investments then. 'tax on inflation' as you put it is hardly the sole domain of residential property investment, why should it be the only one exempt?

Sounds like your point about being able to buy the same thing for the same money is up to fuck all.

I did exactly that. Just like the economist dude predicted.

Basics: Building a house cost twice the relative income it once did, but at 265sqM they're almost three times the size they were then, and with interest rates less than half what they were cost of ownership is fuck all different.

[Graystone]

I did exactly that. Just like the economist dude predicted.

Basics: Building a house cost twice the relative income it once did, but at 265sqM they're almost three times the size they were then, and with interest rates less than half what they were cost of ownership is fuck all different.

Those basics sound a bit suspect, have you got a source for them?

[Ocean1]

Those basics sound a bit suspect, have you got a source for them?

http://dividend.net.au/anz/

Apparently Ork's new homes are a mere 235sqM: http://www.stuff.co.nz/business/prop...uch-big-houses

https://www.nzadvicegroup.co.nz/blog...nterest-Rates/

[sidecar bob]

Trump inc was made bankrupt ages ago, yet acording to popular wisdom hes still reaping the tax benefits of that.... So why not.
There is of course rules regarding how quick you can claim depreciation and the rules regarding accounting for what you depreciated when you do actually sell those same assets though.

Could be a bit of a precarious situation for the Govt if there is a sicnificant national "correction" in housing prices.
They had better hope prices continue to rise & put property further out of reach of first home buyers in order to keep their hobby horse safe.

[TheDemonLord]

Try get some data then, then draw conclusions... I'd love to see this 100-150k house equivalent to a 200-300k house now...

I did some googling - it's a bit tricky - the advanced data/filters require an REINZ or similar login - which I don't have (and no longer have access to) but for example - there's a 2 bedroom house in West Auckland valued at $175k in 2004 and $280k in 2014, last sale shows a shade over $300k (which was in the last 2 years).

Choices that are acceptable to the result of owning a house, this has nothing to do with if the people are willing to make those choices/tradeoffs.

If they aren't willing to make them, then clearly those choices aren't acceptable to them...

A generation ago people didn't have to decide to be that as far from work to own a house.

Tempora mutantur, et nos mutamur in illis.

They also didn't have all the advances we have in terms of working remotely either and the options of work that don't require a physical presence.

It's not a loophole? How so? people can make investments and not have to pay tax on the income from that.

A loophole is something like having a rental property, collecting less rent than the mortgage payments, deducting that as a loss against your main income and paying income tax on the difference.

This isn't something like that. It simply doesn't exist for homes that have been owned for more than 2 years - whereas a loophole. by definition uses either vaguary or holes in poor legislation to avoid the purpose of said legislation. There's nothing vague or unintended about a definitive time period.

However - I will grant you, that this is an entirely semantics point. But it irks me because it's a deliberate attempt at a smear, using the negative connotations of the word.

the goal is to tax income, it will acheive that goal; the driver is an even playing field. Stop with the strawman bullshitery again.

How is that a Strawman? I'm saying I don't trust the motives, based on certain historical precedents - that cannot be a Strawman of anything, because it's my opinion of their motives. Not a rebuttal of their arguments for the law...

However - interesting choice of words again - you want an even playing field - one might say that this is a desire for some form of Equity - Now, where have I heard this tune before, desiring equity and demanding some form of penalty for those perceived as 'rich', to bring them inline with the poor oppressed and downtrodden... How well did it go again?

Here is where you could accuse me of a Strawman (since I'm rebutting one of your points) - but this argument is IMO fundamentally flawed and is rooted in resentment. It's the same reasoning that has been used for expropriation - especially by those of a far-left persuasion. Granted a CGT is rather milder than what we see in history - but even you speak in terms of equity and you definitely seem resentful in your choice of wording against the people this would effect.

And I simply don't trust it.

Then make a better effort to go back to that perspective, because you sure are not there anymore.

How do you know? Did you know me when I bought my house? This is hilarious because your entire argument hinges on your presumption of how I thought and acted several years ago - something which you cannot possibly know.

And there are those who want to own investment properties to avoid paying tax on their income, let's at least level the playing field eh!

Hold up a sec there bud.

You say "Investment Properties" - but I think you are being deliberately vague here - if you are talking about people who buy cheap houses, spend some time and effort to tart them up and sell for a profit (the colloquial "House flippers") they are being taxed by our current Capital Gains Tax.

If you are talking about people that own Investment properties with Renters in - guess what you have to pay on the Rent you receive? I'll give you 2 clues - it begins with T and Jacinda loves it.

Unless you want to imply that someone buys a house, holds onto it for 2 years with no renters in it (which would be costly as fuck with Mortgage repayments - even Interest only) and then sell it the day after the 2 year limit expires - and they live solely on that income.

There may be people that do that, but that's a very expensive gamble and requires a 2 year waiting period - can you afford to wait 2 years to get paid?

It's drum beating because you continue to avoid the point about property as an investment to tell us all about how good you are since you own a house.

No, I'm saying that I was effected by the same set of factors as my peers, and unlike the majority of them who piss and moan and demand someone else fix their problems, I got on with it, sorted what I needed to and now reap the benefits.

One person doing it doesn't mean it is possible for everyone, nor that it is as easy as it used to be.

That's true to an extent, but are you sure it isn't as easy as it used to be? What about the inflation rates in the mid 70s all the way through to the late 80s sometimes peaking to over 20%? My In-laws can attest that at the time, they nearly couldn't afford to keep the house and they struggled to make ends meet. We've had low. relatively stable inflation rates since about the 1990s.

As for one person doing it - unless you want to concede that I'm some form of Financial demi-god/wizard - If I can do it - that means a large proportion of my peers can also do it. To put into perspective - I think I was on $50k a year when I bought - so it's not like I was making extreme amounts of money.

[eldog]

Apparently Ork's new homes are a mere 235sqM: /

Mines approx 230 m^2 the estate agent reckons double the price in 10 years

Little boxes, cheap n nasty little boxes, quite a few planted on shady ground.
double story tiny garage if any that could only accommodate a mini.

the old state houses, wondered how many squares they were?

its been 30 years since 1987 and several people think the current boom will extend for 2 years then may slow down similarly to back then. Approx 15 year cycles.


yeah I remember people talking about 20+% interest rates. I don’t know how they did it.

[Graystone]

http://dividend.net.au/anz/

Apparently Ork's new homes are a mere 235sqM: http://www.stuff.co.nz/business/prop...uch-big-houses

https://www.nzadvicegroup.co.nz/blog...nterest-Rates/

So in only 15 years it has gone up 100%. And in very similar (91-2017) timeframe the size has gone up 37% So I guess per sq/m it has only gone up 63% The interest rates are interesting (pun intended), I had no idea it was 15% back in 1990, you're right in that does make a huge difference, parity is around the 20 year repayment term mark.

Is it part of the same issue though? Or is it corrective behavior which will counter the lack of investment if profits are taxed.

[Graystone]

I did some googling - it's a bit tricky - the advanced data/filters require an REINZ or similar login - which I don't have (and no longer have access to) but for example - there's a 2 bedroom house in West Auckland valued at $175k in 2004 and $280k in 2014, last sale shows a shade over $300k (which was in the last 2 years).



If they aren't willing to make them, then clearly those choices aren't acceptable to them...



Tempora mutantur, et nos mutamur in illis.

They also didn't have all the advances we have in terms of working remotely either and the options of work that don't require a physical presence.



A loophole is something like having a rental property, collecting less rent than the mortgage payments, deducting that as a loss against your main income and paying income tax on the difference.

This isn't something like that. It simply doesn't exist for homes that have been owned for more than 2 years - whereas a loophole. by definition uses either vaguary or holes in poor legislation to avoid the purpose of said legislation. There's nothing vague or unintended about a definitive time period.

However - I will grant you, that this is an entirely semantics point. But it irks me because it's a deliberate attempt at a smear, using the negative connotations of the word.



How is that a Strawman? I'm saying I don't trust the motives, based on certain historical precedents - that cannot be a Strawman of anything, because it's my opinion of their motives. Not a rebuttal of their arguments for the law...

However - interesting choice of words again - you want an even playing field - one might say that this is a desire for some form of Equity - Now, where have I heard this tune before, desiring equity and demanding some form of penalty for those perceived as 'rich', to bring them inline with the poor oppressed and downtrodden... How well did it go again?

Here is where you could accuse me of a Strawman (since I'm rebutting one of your points) - but this argument is IMO fundamentally flawed and is rooted in resentment. It's the same reasoning that has been used for expropriation - especially by those of a far-left persuasion. Granted a CGT is rather milder than what we see in history - but even you speak in terms of equity and you definitely seem resentful in your choice of wording against the people this would effect.

And I simply don't trust it.



How do you know? Did you know me when I bought my house? This is hilarious because your entire argument hinges on your presumption of how I thought and acted several years ago - something which you cannot possibly know.



Hold up a sec there bud.

You say "Investment Properties" - but I think you are being deliberately vague here - if you are talking about people who buy cheap houses, spend some time and effort to tart them up and sell for a profit (the colloquial "House flippers") they are being taxed by our current Capital Gains Tax.

If you are talking about people that own Investment properties with Renters in - guess what you have to pay on the Rent you receive? I'll give you 2 clues - it begins with T and Jacinda loves it.

Unless you want to imply that someone buys a house, holds onto it for 2 years with no renters in it (which would be costly as fuck with Mortgage repayments - even Interest only) and then sell it the day after the 2 year limit expires - and they live solely on that income.

There may be people that do that, but that's a very expensive gamble and requires a 2 year waiting period - can you afford to wait 2 years to get paid?



No, I'm saying that I was effected by the same set of factors as my peers, and unlike the majority of them who piss and moan and demand someone else fix their problems, I got on with it, sorted what I needed to and now reap the benefits.



That's true to an extent, but are you sure it isn't as easy as it used to be? What about the inflation rates in the mid 70s all the way through to the late 80s sometimes peaking to over 20%? My In-laws can attest that at the time, they nearly couldn't afford to keep the house and they struggled to make ends meet. We've had low. relatively stable inflation rates since about the 1990s.

As for one person doing it - unless you want to concede that I'm some form of Financial demi-god/wizard - If I can do it - that means a large proportion of my peers can also do it. To put into perspective - I think I was on $50k a year when I bought - so it's not like I was making extreme amounts of money.

Oh do fuck off with these long winded posts of drivel, learn the value of a concise counterpoint for fucks sake.

So 60% in ten years. Seems pretty drastic to me.

Choices that are acceptable to the result of owning a house, this has nothing to do with if the people are willing to make those choices/tradeoffs.

It's a strawman since you are applying an assumption about motivations and arguing against that, instead of addressing the point, which is that the goal is to tax income, it will achieve that goal; the driver is an even playing field.

Guess you never had the perspective at all then.

They have income from both the renters, and the capital gains. What is the justification for only taxing one of those?

That's still drum beating anecdotal evidence which fails to address the point that house values are rising far quicker than wages/inflation/sizes can account for.

[Ocean1]

Mines approx 230 m^2
Little boxes, cheap n nasty little boxes, quite a few planted on shady ground.
double story tiny garage if any that could only accommodate a mini.

the old state houses, wondered how many squares they were?

Have just sold mine, at a fucking ridiculous 320sqM. Couldn't find anything suitable any smaller at the time. Spent the last year or so looking for a 3 bedroom low maintenance modern house under 200sqM. Had to settle for 220sqM, there just wasn't anything smaller.

The daughter ownd a typical ex state house, was 90sqM. Probably another 3sqM for the enclosed back porch converted into a laundry. No garage. No driveway. No front fence.

[Ocean1]

So in only 15 years it has gone up 100%. And in very similar (91-2017) timeframe the size has gone up 37% So I guess per sq/m it has only gone up 63% The interest rates are interesting (pun intended), I had no idea it was 15% back in 1990, you're right in that does make a huge difference, parity is around the 20 year repayment term mark.

Is it part of the same issue though? Or is it corrective behavior which will counter the lack of investment if profits are taxed.

I bought a house on 12% interest in '88, a year later I was paying 21% on most of it, (some was fixed.) I got a second job. Tough times.

Is what corrective behaviour? I think people pay what they can afford given how hard they're prepared to work. It's worth considering that maybe the second part is the behaviour that's changed the most. It's certainly presumptuous and frankly doubtful to suggest that our parents and grandparents worked less hard for their homes.

[Graystone]

I bought a house on 12% interest in '88, a year later I was paying 21% on most of it, (some was fixed.) I got a second job. Tough times.

Is what corrective behaviour? I think people pay what they can afford given how hard they're prepared to work. It's worth considering that maybe the second part is the behaviour that's changed the most. It's certainly presumptuous and frankly doubtful that our parents and grandparents worked less hard for their homes.

The way the interest rates adjusted to keep a similar cost of ownership, seem like corrective behaviour.

[Katman]

The daughter ownd a typical ex state house, was 90sqM. Probably another 3sqM for the enclosed back porch converted into a laundry. No garage. No driveway. No front fence.

I imagine it still beat living with you.

[husaberg]

Could be a bit of a precarious situation for the Govt if there is a sicnificant national "correction" in housing prices.
They had better hope prices continue to rise & put property further out of reach of first home buyers in order to keep their hobby horse safe.

I think a few places will see an adjustment in pricing as they are overinflated.
But don't worry about the poor let them eat Steak......

[AllanB]

the old state houses, wondered how many squares they were?

Would have been approx 100m2.

The EQC cap of $100k plus gst was set when EQC was invented as the standard three bedroom one bathroom family house back then was 100m2