Australia\u2019s negative gearing hotspots have been revealed, with the data showing investors right across the state were reliant on the tax method as a wealth creation tool \u2013 but also issuing a warning that rents could increase as changes to the investment tactic impact the market.<\/p>\n
According to Australian Taxation Office figures for the 2023\/24 financial year collated by Carlisle Homes, landlords at Williams Landing in Victoria recorded the nation\u2019s highest average net loss for the year at $10,294.<\/p>\n
Victoria actually dominated the list.<\/p>\n
In second place with an annual net rental loss of $10,259 is Crace in the ACT, just ahead of Fraser Rise in Victoria, where the annual average net loss was $10,054.<\/p>\n
The Ponds in New South Wales came in fourth with a $9538 net loss, ahead of Victoria\u2019s Lynbrook, Wyndham Vale, Laverton North in spots five through seven.<\/p>\n
Schofields in NSW came in at ninth, with Wollert in Victoria taking out 10th position.<\/p>\n
<\/p>\n
Loan market mortgage broker Tony Nguyen in Northgate \u2013 SA\u2019s negative gearing hotspot. Picture: Roy VanDerVegt<\/p>\n
South Australian Loan Market mortgage broker Tony Nguyen said there had been a shift across the market.<\/p>\n
\u201cWe have people who have purchased properties in those suburbs earlier on at a good price point and those suburbs have exploded in price, where they\u2019re now getting into a positive cash flow,\u201d Mr Nguyen said.<\/p>\n
\u201cRenters they are finding it much more competitive.<\/p>\n
\u201cRents are obviously going higher just because of how the market is with interest rates, investors are looking to increase those rental prices just to cover the cost of holding on to an investment property, and that\u2019s what\u2019s seen some of them shift from negatively geared to cashflow positive.<\/p>\n
\u201cRenters are definitely changing their mindset and we\u2019re seeing people exploring other options and considering other suburbs they would not have considered because of the cost of living pressures.\u201d<\/p>\n
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Changes to negative gearing are prompting a rethink in investment strategies, experts say.<\/p>\n
He said the downside to the changes in negative gearing was people who would otherwise look to sell their properties were holding on to them so they didn\u2019t lose the investment perk.<\/p>\n
This kept those properties from the sales market, thereby reducing the amount of available stock for people looking to enter the market of move up or down in it.<\/p>\n
Dig deeper into the negative gearing hotspots in your state<\/p>\n
Victoria: Victoria warned of biggest negative gearing hit<\/a><\/p>\n New South Wales: ATO leaks reveal where gearing reforms will hurt most<\/a><\/p>\n South Australia: Adelaide landlords lose $4.5m in top tax hotspot<\/a><\/p>\n Queensland: In the red: Qld landlords plunged into $593m black hole<\/a><\/p>\n He also said the negative gearing changes had spooked mum and dad investors, but they were still buying.<\/p>\n \u201cA lot of them are purchasing properties in things like trusts and companies which aren\u2019t impacted by the changes.\u201d<\/p>\n The market shift has seen many negatively geared homes shift to becoming cashflow positive. Picture: iStock<\/p>\n Carlisle Homes general manager of marketing Janine Armstrong said the change in some markets from a negatively geared strategy to a positively geared approach showed how sharply the economics of property investment changed as borrowing costs increased.<\/p>\n \u201cSustained pressure on investor returns can influence investment decisions and rental-market participation, at a time when Australia is already facing significant housing-supply pressures,\u201d she said. <\/p>\n \u201cWhen interest costs double in two years, the impact on rental property returns is significant. \u201cRental income may rise at the same time, but for many investors it hasn\u2019t been enough to offset the increase in borrowing costs.<\/p>\n MORE NEWS<\/p>\n $660k Aussie home loan record forces first-home buyer rethink<\/a><\/p>\n The statistic that should terrify all homeowners<\/a><\/p>\n Southern Ocean Lodge link to Adelaide development revealed<\/a><\/p>\n Shock result as council forcibly sells 57 properties to recoup unpaid rates<\/a><\/p>\n This 100 pound Adelaide home just sold for how much?<\/a><\/p>\n<\/p>\n