New homes not necessarily for property investors: Rich Harvey

Investors overwhelmingly put money into established housing, some 90 percent plus of the recent annual total of $154 billion of property investment last year, according to CoreLogic RP Data head of research Tim Lawless.

The Sydney buyers' agent Rich Harvey, CEO of propertybuyer.com.au, suggest the Federal Labor proposal that herds investors towards buying buying brand new homes was flawed.

"It was not necessarily the best investment strategy," he told the Australian Financial Review.

"It's really hard to find good quality developments that stack up from an investment perspective,"  he said.

"For our business, it would be a very negative thing because 90-95 percent of our clients invest in established property."

His comments were backed up by Destiny investment adviser, Margaret Lomas, who said negative gearing should not be tampered with because it would reduce the ability of ordinary baby boomers to create retirement income.

"Brand new properties come at a premium, but existing property is affordable and achievable," she said.

Ms Lomas warned the Labor proposal would open the flood gates for more spruikers selling over-priced property. 

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