Research commissioned by industry superannuation funds has substantially supported Federal Opposition policy on negative gearing, finding that the majority of people who don’t own investment property support changes to the existing negative gearing campaign.
The research, released at the Conference of Major Superannuation Funds (CMSF) in Brisbane was commissioned by the Australian Institute of Superannuation Trustees and conducted by Essential Media and found that more than half of non-investors in property would support changes to negative gearing, even if it mean house prices falling slightly.
The research found 55 per cent of non-investor respondents would support the changes to negative gearing, with just over a third of respondents who described themselves as property investors also indicating they would support a change.
It said that support was strongest (45 per cent) among property investors with children.
The survey also found that 95 per cent of investors said security in retirement was an important factor in influencing their decision to purchase an investment property with minimising the amount of tax they paid being another motivating factor for 74% of investors.
The research also found the needs of investors’ children played a role in property purchases but less so than retirement needs.
It said that creating an asset that they could pass on to their children was important for 79 per cent of property investors, while providing somewhere for children to live was important to 57 per cent of investors.
The survey also revealed that many ‘negative gearers’ are expecting to carry large debts into retirement, with about one third of those who negative gear expecting to carry more than $100,000 of debt into retirement, compared to 8 per cent of those without an investment property, and 11 per cent of those with a non-geared investment property.
Commenting on the research, Essential Media head of research, Dr Rebecca Huntley said fear of not having enough to retire was driving property investment.
AIST chief executive, Eva Scheerlinck said the survey confirmed that housing affordability was a significant concern to most Australians, including those heading into retirement.
“The long-held assumption that the home is a safety net for retirees is becoming increasingly dubious as more older people are being forced to rent or use their super to reduce their mortgage in retirement,” Scheerlinck said.
She said it was time to re-examine the role of negative gearing and Capital Gains Tax concessions which had been shown to fuel house price and was directing tax expenditure into unproductive assets.