Iwan Sunito's vision for a landmark mixed-use precinct in Sydney's Inner West has taken a major step forward, with approval granted for the $1.9 billion Five Dock development first unveiled earlier this year.

The approved scheme by <a href="https://www.apartments.com.au/developers/one-global-capital">One Global Capital</a> will deliver an 80,500 sqm mixed-use precinct comprising 840 apartments, integrated hotel accommodation, commercial and retail space, alongside publicly accessible open space designed to create a new destination for the growing suburb.

"This is a significant milestone for One Global Capital and for the future of housing delivery in Sydney," Sunito said.

"The Housing Delivery Authority was established to identify major housing projects capable of delivering meaningful supply more efficiently, and we are delighted that Spencer Street has been recognised as one of those projects.”

He said the declaration reflected the rapid progress achieved since acquiring control of the site.

"In less than seven months we have progressed from taking control of the site to securing entry into one of the NSW Government's most important planning pathways. It reflects the experience of our team, the strength of our consultant group led by Urbis, and our long-term commitment to delivering transformational projects that contribute to Sydney's future."

When the project was revealed earlier this year, Sunito described the opportunity as one of the strongest development sites he had worked on.

"I probably hadn't appreciated the uniqueness of the site until more recently when putting together the concept plans," Sunito said.

"The proximity to the water, and the golf course opposite, is unlike any other part of Parramatta Road. We have a unique position and view corridors over the water that makes this one of the best sites I've worked on."

The development has evolved since its initial announcement, with the approved plans increasing the residential component from the originally proposed 750 apartments to 840 homes while retaining the project's focus on creating an integrated neighbourhood rather than a standalone residential development.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/a-city-within-a-city-iwan-sunito-flags-1-5-billion-mixed-use-precinct-in-five-dock">"A city within a city": Iwan Sunito flags $1.5 billion mixed-use precinct in Five Dock</a>

The precinct will combine apartments with hotel accommodation, commercial workplaces, retail offerings and public spaces, creating a mixed-use environment intended to serve both residents and the broader Five Dock community. The proposal also continues the collaboration between One Global Capital and internationally recognised architect <a href="https://www.apartments.com.au/architects/koichi-takada-architects">Koichi Takada</a>, whose previous work with Sunito includes Infinity, Arc and Skye North Sydney.

Takada previously said the design was driven by a philosophy of integrating nature into the built environment.

"The concept for this development is born from our design approach to naturalising architecture," Takada said.

"The public realm benefits from biophilic design that integrates generous landscaping, and the development is optimised for natural daylight, airflow and water views to foster wellbeing, sustainability and spaces that foster community interaction."

Sunito has consistently described the project as a "city within a city", with a strong emphasis on creating a destination that extends beyond housing.

"We want to create a development that's not only to be seen, but to be experienced by the whole local community," he said.

The approval comes as Five Dock continues its transformation ahead of the opening of the Sydney Metro West line, with the new Five Dock station set to significantly improve connections between the Inner West, Parramatta and the Sydney CBD.&nbsp;

The precinct will also benefit from its proximity to the Parramatta Road corridor, nearby waterfront parklands and established retail and dining offerings that have made Five Dock one of Sydney's most tightly held Inner West suburbs.

Joel Robinson

Iwan Sunito secures approval for $1.9 billion Five Dock mixed-use precinct

The new <a href="https://www.apartments.com.au/new-apartments/yarraville-green-42-stephen-street-yarraville-vic-3013">Yarraville Green</a> development in Melbourne's inner west is showing that landscaping can be just as influential as architecture, with buyers responding strongly to the garden-first approach adopted from the outset by developer Excelon Projects and the project's design team.

Excelon appointed Six Degrees Architects and landscape architects SBLA to work collaboratively on the development, with a brief to create "a sustainable, design-led building with a focus on community."

That approach has resonated with buyers. According to Next Chapter Director Tom Hirini, who is leading the sales campaign, the landscaped communal garden has become one of the project's defining features, alongside its boutique scale and European-inspired cluster housing concept.

Local downsizers, right-sizers and established families already living in Yarraville and surrounding suburbs have accounted for the majority of purchasers.

[smartcode_project:default project_id=144913 project_image_fid=297740]

Yarraville Green will comprise 53 homes, including apartments and townhomes, arranged around the shared central garden to maximise connections to the landscaped open space. Parking has been moved underground, allowing the ground plane to be dedicated to greenery, pedestrian movement and communal spaces.

The landscape extends well beyond passive planting. Productive garden beds, a pergola, communal gathering spaces, garden sheds and a pet wash have all been integrated into the masterplan, creating spaces designed to encourage everyday interaction between residents.

[smartcode_project:default project_id=144913 project_image_fid=297741]

The interiors continue Excelon's focus on craftsmanship, incorporating bespoke elements by Melbourne artisans including leadlight detailing by Adadaz, hand-turned timber hardware by Auburn Woodturning and blown-glass lighting by Ruth Allen.

Sustainability has also been embedded throughout the project, with Yarraville Green targeting an average 7-star NatHERS energy rating through passive design principles, rooftop solar servicing common areas and rainwater harvesting for landscape irrigation.

[smartcode_project:default project_id=144913 project_image_fid=297735]

Construction continues to progress at Yarraville Green, with structural works well underway and framing works approaching completion under builder Balmain &amp; Co. The project remains on track for completion in mid-2027.

Apartments at Yarraville Green are currently priced from $625,000, while townhomes start from $1.4 million.

[smartcode_project_cta:default project_id=144913]

Garden-led design drives buyer demand at Yarraville Green

National diversified developer Fortis has officially launched Crest &amp; Walker, its latest Brisbane apartment development, with construction now underway on the 20-storey Newstead project.

Award-winning builder BINAH has commenced construction on the Bureau^Proberts-designed building, which will deliver a limited collection of 65 two and three-bedroom apartments on Kyabra Street.

[smartcode_project:default project_id=145922 project_image_fid=373556]

The project marks Fortis' fourth active residential development in Brisbane, following River House, which is nearing completion, alongside projects in New Farm and Hamilton as the national developer continues to expand its South East Queensland pipeline.

Fortis General Manager – Development Queensland Dan Boman said Crest &amp; Walker reflects the developer's long-term commitment to delivering design-led residential projects in Brisbane's established inner-city suburbs.

"We're proud to be strengthening our presence in Brisbane with Crest &amp; Walker, particularly in such a sought-after lifestyle destination as Newstead," Boman said.

"Every Fortis project is shaped by its context, and we approach each one with the respect and care it deserves.

"Our focus is always on creating places that feel connected to their neighbourhood and elevate the everyday experience for residents. Newstead continues to evolve as one of Brisbane's most sought-after urban communities, and Crest &amp; Walker reflects our ambition to contribute meaningfully to that story."

[smartcode_project:default project_id=145922 project_image_fid=373559]

Positioned between Gasworks Plaza and James Street, <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> has been designed as a boutique residential address offering privacy and generous living spaces within one of Brisbane's most established lifestyle precincts.

The building features a contemporary brick podium softened by integrated landscaping, while the upper levels are characterised by restrained architecture and enduring materiality. Interiors have been designed to maximise natural light, acoustic performance and long-term liveability.

[smartcode_project:default project_id=145922 project_image_fid=373583]

Residences comprise spacious two and three-bedroom floorplans, with two-bedroom apartments priced from $1.55 million and three-bedroom, half-floor residences from $3.95 million.

Residents will have access to a wellness-focused rooftop featuring a swimming pool, sauna, steam room, landscaped dining spaces and outdoor lounge areas overlooking Newstead and the Brisbane CBD.

[smartcode_project:default project_id=145922 project_image_fid=373571]

Sales are being managed by Slaite Projects, with Fortis expecting strong demand from owner-occupiers seeking a high-quality, design-focused apartment in one of Brisbane's most tightly held inner-city suburbs.

Completion of Crest &amp; Walker is slated for late 2028.

[smartcode_project_cta:default project_id=145922]

Fortis expands Brisbane pipeline with launch of Crest & Walker in Newstead

The enormity of delivering a true skyscraper in Australia's new development market is often overlooked.

It has taken the best part of a decade since plans for Chevron One were first unveiled, but the 41-storey tower is now complete, with residents collecting their keys and moving into what has become one of the Gold Coast's most recognisable new landmarks.

Rising 127 metres above Chevron Island, Chevron One stands almost twice as high as any other building on the island. Its scale places it alongside the trio of towers at Jewel, arguably the last truly significant addition to the central Gold Coast skyline when they were completed around six years ago.

While there are several developments underway around a similar height to Chevron One, they are more concentrated within clusters of the highest towers in the city. The fact Chevron One sits within a developing precinct, looking back at the other high-rise developments in Surfers Paradise and Broadbeach, makes it a different proposition altogether. It will certainly become a reference point on the Gold Coast skyline.

[smartcode_project:default project_id=6515 project_image_fid=68833]

Developer Bensons Property Group is behind the 41-storey tower, which has 229 apartments, along with an exhaustive list of resident amenity spread across what is the largest development site ever assembled on Chevron Island.

The tower has been the talk of the town for years, says Ray White Projects Gold Coast agent Caitlin Rosenboom, who is selling the remaining apartments.

"People have been watching Chevron One go up for years," Rosenboom says, adding that many prospective buyers have been surprised by the scale of the views once they step inside.

"It's only when they walk through a completed apartment that they truly understand the position of the building," Rosenboom says.

"The views are jaw-dropping. Whether you're looking east over the ocean, across Surfers Paradise, along the river systems or out to the hinterland, every level offers something different but equally impressive."

[smartcode_project:default project_id=6515 project_image_fid=360215]

One of Chevron One's defining advantages is its location on the eastern side of Chevron Island on Stanhill Drive, a position which protects the views forever.

"There's only one row of houses between Chevron One and the water, and the height restrictions along the river means views from Chevron One can never be built out,"&nbsp;Rosenboom says.

While new apartment developments continue to emerge across the Gold Coast, Rosenboom says opportunities to secure a completed apartment with this level of outlook are becoming increasingly rare.

"The size of the site is something that would be incredibly difficult to replicate today," she says.

"That's allowed Chevron One to deliver the sort of amenity, open space and resident facilities that very few projects can offer. There are not many completed apartment buildings on the Gold Coast right now that can compete with the combination of scale, quality and amenity."

[smartcode_project:default project_id=6515 project_image_fid=68839]

There's around 2,000 sqm of amenity solely for the use of residents of Chevron One. Club One features a uniquely shaped swimming pool that mirrors the footprint of the building itself, set within a extensively landscaped gardens. There's also an indoor pool and spa, a fully equipped gym with a Pilates room, a yoga garden, a bookable private dining area and lounge that can host up to 30 people, and a 24-hour concierge service.

As for the buyers, Rosenboom is fielding enquiry from everywhere: Sydneysiders and Melburnians looking at the new and off-the-plan market following the changes in the Federal Budget, as well as those looking to relocate, through to South East Queenslanders seeking either a permanent home or a weekender bolthole.

"The Gold Coast lifestyle continues to resonate with people relocating from the southern states, and when they see the views and the quality of what's been delivered at Chevron One, it becomes very easy for them to understand the appeal," Rosenboom says.

A diverse mix of one, two and three-bedroom apartments remain available, with each offering "something a little different", be it the orientation and views, configuration, or level, to suit a wide variety of buyers.

The remaining apartments are ready to inspect in person, by appointment.

[smartcode_project_cta:default project_id=6515]

A decade in the making: Residents to move into Chevron One as construction wraps up

A general rule of thumb in new apartment developments is that the penthouses get the rooftop.

It's a formula that's become commonplace across Australia's apartment market. Residents might have access to a pool, gym or barbecue facilities on a dedicated lower level, but the most desirable outdoor spaces are typically reserved for the highest-priced homes at the top of the building.

<a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Property Group</a> has taken the opposite approach.

Rather than dedicating the rooftop to a handful of buyers, the Gold Coast developer has made it the centrepiece of its Flourish collection, creating expansive shared spaces from the best vantage point in the building.

The philosophy has reached its most ambitious expression at <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a> in Palm Beach, where two rooftop precincts connected by a skybridge will deliver one of the most extensive lifestyle offerings seen in a residential apartment project on the Gold Coast.

[smartcode_project:default project_id=150017 project_image_fid=374053]

"We're seeing a clear move toward developments that offer more than just an apartment," Sherpa Group founder Christie Leet said.

"People want spaces that support how they actually live, whether that's working from home, staying active, or spending time with family and friends.

"That's where amenity becomes critical. It's not just about what's included, but how those spaces are designed to be used every day."

[smartcode_project:default project_id=150017 project_image_fid=374052]

The breadth of amenity has already attracted buyers across multiple demographics. Younger first home buyers have been drawn to Soleira's one-bedroom apartments, a product rarely delivered in Palm Beach, while families have responded to practical inclusions such as the shallow children's pool adjoining the main lap pool and the extensive communal recreation areas.

Instead of a single rooftop, Soleira delivers two distinct lifestyle zones.

[smartcode_project:default project_id=150017 project_image_fid=372547]

The southern rooftop has been dedicated to wellness, featuring a gym, yoga and Pilates studio, work-from-home facilities, a wellness centre, spa, and hot and cold plunge pools.

The northern rooftop focuses on recreation and entertaining, incorporating a heated resort-style pool, private dining rooms, pizza ovens, barbecues, a golf simulator, children's recreation areas, and what is expected to be the Gold Coast's first rooftop basketball court, which will also double as a squash court.

[smartcode_project:default project_id=150017 project_image_fid=374054]

Beyond the rooftops, Soleira will introduce 1,500 sqm of curated retail beneath the towers, creating one of Palm Beach's first genuinely mixed-use lifestyle precincts where cafés, restaurants and convenience retail become part of residents' everyday lives.

Sherpa has also retained management rights across the development, allowing it to oversee the long-term operation of the building through a 24-hour concierge model. The developer is also exploring additional revenue streams within the precinct aimed at helping offset ongoing body corporate costs for residents.

[smartcode_project:default project_id=150017 project_image_fid=370962]

While Soleira is the largest project Sherpa has delivered, the rooftop-first philosophy has been evolving for several years.

It began with <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>, the first project released under the Flourish brand. Rather than competing at the ultra-luxury end of the market with oversized half-floor and full-floor residences, Sherpa focused on creating lifestyle-driven apartments supported by resort-style shared spaces.

Amargo introduced more than 800 sqm of rooftop amenity, combining wellness facilities, heated pools, entertaining areas, cabanas, pizza ovens and private dining spaces into what was designed as an extension of residents' homes rather than a facility used only occasionally.

[smartcode_project:default project_id=146527 project_image_fid=366550]

That approach continued with Flourish Oasis, where the same amenity-led philosophy was refined into a more boutique development. Strong demand from Sherpa's growing VIP database saw much of the project sold before it reached the broader market, reinforcing buyer appetite for apartment communities centred around shared lifestyle experiences.

Flourish Amargo is slated for completion mid-way-through next year, with Oasis to be delivered by late 2027. Flourish Soleira is expected to complete in 2030.

[smartcode_project_cta:default project_id=150017]

Sherpa takes amenity to the sky as Flourish Soleira captures booming Palm Beach demand

Negative gearing

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GUEST OBSERVER
Recent statements by the Labor Party that negative gearing and capital gains tax concessions would be reduced send negative messages to ordinary Australians investing in property. 
It is the combination of restricting negative gearing and of reducing capital gains tax deductions on residential property investments that will discourage ordinary Australians from investing in property.
Many Australians have preferred to invest in property over other forms of investment, like shares or bonds, and this has been based on negative gearing to minimise recurrent costs while expecting a positive return from capital gains over time.
While traditionally home ownership has been seen as an Australian ideal this has shifted in recent decades with more people renting while many ordinary Australians have borrowed money to be able to earn an income from a house or apartment.
The people who benefit from negative gearing are those that must borrow to buy an investment property rather than the very wealthy who don’t borrow or borrow less and can use their own funds. It seems unfair of the Labor Party to target ordinary Australians who need to borrow and to discourage them from aspiring to be owners of income producing properties.
The reduction in the use of negative gearing to only new properties while appearing to boost supply is likely to result in increases in new property prices as more investors compete for only new housing. The aspirations of ordinary Australians to be property investors as part of a diversified approach to managing their long term finances should be encouraged rather than discouraged.
The slashing of the capital gains tax deduction by 50% will further discourage all property investors of new or old assets from investing in built assets. The end product of the Labor Party proposals is to undermine confidence in property investment by ordinary Australians as well as larger organisations. This can only lead to less supply of rental properties with a consequent jump in rental fees.
The Urban Taskforce understands that adjustments to the taxation system need to be considered but we believe any changes should encourage the development of more housing funded by the broader community’s investment.
Stamp Duty is clearly a tax that is a disincentive to the purchase of a house or apartment and we believe this should be abolished and replaced by a fair broad based land tax which spreads the tax burden over a much larger ownership base.
 
Chris Johnson is chief executive officer of property development industry group Urban Taskforce and can be contacted <a href="https://www.urbantaskforce.com.au/index.php?option=com_content&amp;view=article&amp;id=97&amp;Itemid=126#.Vdaart55dFI" target="_blank">here</a>.
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Labor proposals to change taxation on housing could slow down supply: Chris Johnson

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The Turnbull government has rejected Labor's policy to restrict negative gearing to new properties.
It now plans to target high-end investors by either capping the number of properties that can be geared or limiting the annual tax deductions of which can be claimed.
The Coalition is now pursuing negative gearing, superannuation and tax deductions for savings after plans for an increased GST were ditched.
"We've seen that they've converted tax reform into a cupcake process. The big reform is off the table. Clearly they're looking at options," Property Council chief executive Ken Morrison said.
Master Builders of Australia chief executive Wilhelm Harnisch took aim at Labor's policy saying it was a populist response.
"Investing in new private rental housing is not evil," he said.
Labor says its policy will raise $32 billion over 10 years, but just $570 million in the first four.
Treasurer Scott Morrison told The Australian Financial Review on Sunday that Labor's policy would focus all investors into the new housing market, making it harder for so-called "everyday mum and dad investors" to buy new houses or units off the plan.
This, he said, would intensify the inequity caused by negative gearing in which first homebuyers struggle to compete against cashed-up investors.
"Labor thinks all people who negatively gear are property barons to be fleeced."
On Saturday, Bill Shorten announced that a Labor government, if elected, would move change the rules so that only new homes purchased after July 1, 2017, could be negatively geared.
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There would be no limit on the number of new properties that could be geared. Existing investors would not be affected by the changes.
Labor will also halve from 50 percent to 25 percent the capital gains tax deduction for investors who sell a property after holding it for at least 12 months.
On Sunday, shadow treasurer Chris Bowen reinforced Labor's reasoning that its policy would cause a boom in new home construction.
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Scott Morrison targets high end negative gearing residential property investors

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GUEST OBSERVER
The Real Estate Institute of Queensland (REIQ) rejected Federal Treasurer Scott Morrison’s suggestion that curbing negative gearing was a responsible fiscal alternative to raising the GST.
Negative gearing was well established as a vital tool to encourage investors into the property market, where their continued investment was vital to ongoing rental affordability.
Removing negative gearing from property investment will only serve to drive investors to other assets such as shares, where the offset would remain intact.
This would further impact affordability as there would be fewer houses available to meet rental demand
A review of history would confirm this, with the Hawke government removing gearing benefits in in 1985 only to reinstate them in 1987 when rents surged approximately 24 per cent. 
Removing or scaling back negative gearing would actually hurt the most vulnerable in Queensland, with middle and low-income families unable to afford the resulting rising rents as stock dwindled.
In Queensland more than a third of our population is in rental accommodation, so it’s crucial that supply is maintained for this large section of the community.
If private rentals were drastically reduced this would place enormous strain on the limited resources in public housing.
In its 2013 report Housing 2020, the Queensland State Government outlined its public housing strategy to limit its public housing new builds and to actively transition residents through its public housing, moving them towards private rentals or home ownership.
The Government recognises that the private sector is able to gain more efficiencies in the housing market and the public sector is more costly and less efficient.
The Government strategy focuses on moving residents away from “a view that social housing is a home for life” and instead, places “greater emphasis on social housing as a transitional period on the path to private rental or home ownership”.
If supply was limited to the private rental market and public housing was being scaled back, the social consequences would be significant and detrimental.
Instruments such as negative gearing encouraged individuals to save and invest in property, and this boosted financial self-sufficiency for individuals later in retirement, a key plank of government policy.
There was a common misconception about investors who access negative gearing benefits and capital gains tax concessions, as very wealthy with a vast portfolio of property.
Recent ATO statistics, provided by the Property Council of Australia, revealed that about 70 per cent of investors who benefit from negative gearing earn less than $80,000 and about 73 per cent own just one investment property.
In Queensland, owner occupiers account for two-thirds of the residential dwelling market, with investors making up about a third (34 percent).
ANTONIA MERCORELLA is CEO of the <a href="https://www.reiq.com/" target="_blank">REIQ</a>.
 
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Negative gearing cuts no solution to budget hole: Antonia Mercorella

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Australia’s largest industry, the property industry, has warned a Parliamentary Committee into Tax Deductibility that changes to negative gearing will exacerbate Australia’s undersupply of housing and harm average income earners.
New data has revealed that over 430,000 Australians who negative gear an investment property live in marginal seats held by the Government and the Opposition. The ten most marginal Coalition seats have an average of 8,181 investment property owners and the ten most marginal Labor seats have an average of 8,357 property owners.
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“Mums and dads see owning an investment property as a way of securing their long term prosperity”, said Property Council Chief Executive Ken Morrison.
“There are 840,000 Australians with taxable incomes below $80,000 a year who negative gear.
"This includes 53,800 teachers, 52,000 retail workers, 35,900 nurses and midwives, 22,600 hospitality workers and 10,400 emergency services workers.
“Interest deductions on property are legitimate deductions. Deductions for interest have been a fundamental part of the Australian tax system for 100 years.
“Two million Australians own an investment property. These people are doing the right thing and investing for their retirement or putting away for a rainy day.
“To play with negative gearing is to play with the financial futures of 430,000 people who live in the most marginal seats.
"That’s enough voters to swing all of these seats eight and half times over, a big political risk to take with people with a lot at stake.
“Limiting interest deductibility will make investments more expensive. In turn, this will exacerbate Australia’s undersupply of housing and infrastructure. This is the wrong approach for the challenges we have to face.
“Australians already pay $72 billion a year in property taxes – and property owners don’t want government’s hands reaching even deeper into their pockets.”
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Any negative gearing tampering to become marginal seats election battle: PCA

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GUEST OBSERVER
Average income earners largely are the people who do get to take advantage of negative gearing - nurses, policemen and women on an average wage, investing, for instance, in a property. Most of them hold only one property, which adds to the housing stock that’s available for people as well. – Assistant Treasurer and Small Business Minister Kelly O'Dwyer, speaking on ABC TV’s Insiders, October 25, 2015
Negative gearing is a tax break available for people who own at least one other property in addition to their primary place of residence. This tax break applies only if the costs associated with the investment, including interest payments and other expenses, are greater than the rental income. Any loss made on the property can be offset against other income, thus reducing personal tax.
<div class="grid-ten large-grid-nine grid-last content-body content entry-content instapaper_body">
It’s true many nurses and police officers and other middle-income (and even much lower) people have negatively geared properties. But are these occupations and incomes the typical beneficiaries of negative gearing?
<h2>Checking the data</h2>
When asked for a source to support her statement, a spokesperson for O'Dwyer sent the following statistics.
<blockquote>
• Taxation statistics show 66.5% of taxfilers who declare a net rental loss have a taxable income of A$80,000 or less.
• Those who use negative gearing include 22.6% of police officers, 19.2% of ambulance officers and paramedics, and 18.9% of train and tram drivers.
• Of the Australians who use negative gearing, the majority only hold one additional property.
• 73% of people with a rental property interest have only one property and 18% own two.
</blockquote>
A $80,000 per year is not a typical taxable income. Around 84% of non-investors have a taxable income below $80,000. This compares with the 66.5% of people with negative geared property.
It is true that a relatively high proportion of the listed occupations have negatively geared properties. While it may be the popular belief that these are low or middle income occupations, these are actually reasonably highly paid occupations. For example, 73% of train and tram operators earn more than A$80,000 per year.
In our analysis, we looked at the income distribution of people who negatively gear compared to that of people who do not invest in rental properties.
The data set we used is called the 2012–13 individuals sample file. To collect this data, the Australian Taxation Office (ATO) sampled 2% of all individual tax returns filed in 2012-13.
According to this ATO data set, there are 1.26 million (10%) taxpayers who negatively gear. Their average loss was A$8,930 per year. A further 700,000 with a rental investment are positively geared (meaning their rental income was greater than their costs). About 85% of taxpayers don’t have a rental investment.
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<img src="/images/2015/11/23/image-20151115-10412-1h6jg2h.PNG" alt="">
 
The chart shows what statisticians call the “smoothed” probability distribution (which is a smoothed histogram of the income distribution) of taxable income for people with negatively geared properties and people without rental investment properties. Marked also on the chart are the median and top 10% (P90) income points for both people with negatively geared properties and those without property investments.
The median income for negatively geared investors is A$60,000 per year, compared with $40,000 for non-investors.
A similar gap (50%) exists at the top end of the income spectrum. The taxable incomes of the top 10% of earners with negatively geared investments is around $150,000 compared to $98,000 for non-investors.
The chart shows clearly that, typically, people with negatively geared properties have significantly higher incomes than people without property investments.
In an April 2015 analysis commissioned by GetUp! for the Australia Institute, NATSEM found that 34% of the tax benefits of negative gearing accrues to the richest top 10% of families, as this chart from the report shows.
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Only around 20% of the tax benefits go to the bottom half of the income distribution.
High-income families invest more money than low-income families. The tax system benefits high-income earners more than low-income earners due to higher marginal tax rates amplifying the effectiveness of deductions.
<h2>The role of capital gains</h2>
Negatively gearing property implies that the investor is making a loss on their investment. As the chart below shows, the tax savings are greatest among those in the higher tax brackets. However, it remains the case that these investors continue to make an overall loss on their investment, even after accounting for tax deductions.
<a href="/images/2015/11/23/image-20151119-19348-1fbe7uh.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/23/image-20151119-19348-1fbe7uh.png" alt="">
 
The success of negative gearing as an investment strategy is reliant upon capital gains. In a property upswing, this strategy can be highly successful with lucrative gains on often minimal equity investment. During a property downswing or period of limited price growth, these strategies are very poor investments.
A recent analysis by the Grattan Institute shows that while police and nurses do invest in property, it is the higher-income occupations, such as doctors and mining engineers, who are much more likely to invest.
<h2>Adding to the housing stock?</h2>
Property investment only improves housing affordability when the purchase adds to the stock of newly constructed dwellings in affordable housing.
According to CoreLogic RP Data, in 2014 there were just under 500,000 property transactions and ABS building completions data suggest only around a third of those were newly built dwellings. It therefore stands to reason that most property transactions each year are probably existing stock.
<h2>Verdict</h2>
O'Dwyer’s assertion is not supported by the data. <a href="https://www.ato.gov.au/About-ATO/Research-and-statistics/In-detail/Tax-statistics/Taxation-statistics-2012-13/?page=40" target="_blank">ATO data</a> shows that, typically, negatively geared investors have higher incomes than people without rental investments.
The same data shows that negatively geared investors have typical incomes around 50% higher than non-investors – even after deducting their losses from negative gearing.
The top 10% of the income distribution for negatively geared investors earn around 50% more than non-investors. Incomes for this top 10% are around $150,000 per year, compared with $98,000 for non-investors, according to the ATO.
Ben Phillips is principal research fellow, National Centre for Social and Economic Modelling (NATSEM), University of Canberra. Cukkoo Joseph is research assistant, University of Canberra. Both are authors for The Conversation and can be contacted <a href="https://theconversation.com/profiles/ben-phillips-98866" target="_blank">here</a>.
Review
While I agree with everything in the above FactCheck, I would go further in criticising Kelly O'Dwyer’s statement, particularly the reference to investors adding to the housing stock.
The figure cited above for the ratio of housing purchases for new housing stock includes owner occupiers.
The impact on housing stock is tiny, but the effect on housing affordability of all those investors bidding up the prices of existing housing is likely to be substantial. 
Warwick Smith is research economist, University of Melbourne and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/warwick-smith-95344" target="_blank">here</a>. 
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Are average earners in Australia the main beneficiaries of negative gearing?

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Negative gearing is a contentious subject. Owner-occupiers often resent it, many organisations have called for it to be abolished and it doesn’t always work for all investors.
So what are the pros and cons and what do you need to know as an investor?   Firstly it depends on your investment needs and ambitions. If you’re looking for a short-term investment where the capital growth will accumulate quickly and you can get high rental returns then negative gearing probably won’t work for you.   If you’re an Australian working overseas and looking to invest back home then negative gearing probably won’t make a lot of sense either. This is because if the bulk of your income is being earned offshore and you’re being taxed in the country you’re working in, then you won’t stand to get the tax breaks that the government offers through negative gearing.   Negative gearing itself has been decried as giving an unfair advantage to investors. The Australian Council for Social Services recently suggested that it hurts owner occupiers who aren’t given similar tax breaks. However there are clear benefits to the overall market through negative gearing.   Specifically negative gearing helps the rental market and also keeps the overall property marketing ticking along – driving up prices and keeping it buoyant.   Investors need to keep rentals low so they can effectively negatively gear. This in turn creates equitable and affordable properties for people to rent. Back in 1985 the then Labor government under Bob Hawke abolished negative gearing only to bring it back in 1987.  During that two year period, rents increased drastically across Melbourne, Brisbane and Sydney. 
In Sydney rentals skyrocketed by over 50%. So there’s a clear correlation between negative gearing and affordable housing. Nor does it only help wealthy investors, as some assert. Figures show that 80 percent of those claiming negative gearing earn less than $80 000 per year.   So while there are many benefits to the property market, what do you need to consider if you’re an investor?   The pros • Your taxable income can be significantly reduced by claiming losses on your property. • You can use depreciation of the property to your advantage. So this too can be added to negative gearing claims. • Big losses on the property (such as major strata levies or hefty property maintenance) can potentially be offset once you sell the property. • Most negatively geared properties are bought in high growth, attractive and stable areas. This the best way to achieve long term capital growth. Therefore your property should be safer from sudden market changes. • You have far more scope to develop and existing property or subdivide a block through negative gearing. The cost of building, construction, legals and developing all come back through negative gearing. It means you can potentially add a lot of - value to your long term capital growth.
Cons
• The biggest downside to negative gearing is the high out of pocket expenses you can face. These can be very prohibitive and, if you suddenly have to install a new roof or pay for water damage, exorbitant. Simply you will need to have deep pockets to cover the loss in rentals and all the maintenance of the property. This requires skilful budgeting. • The higher debt you’re potentially accumulating leaves you open to any sudden interest rate rises. Also, if you’re using equity to cover negative gearing this can leave you even deeper in debt and more vulnerable to sudden spikes in the market. • Negative cash flow properties are a longer-term strategy. So you can’t rely on them as a quick cash solution. • Vulnerable to market whims and moods. No capital growth rate is ever assured. Yes, it’s true that most negatively geared properties are in resilient, high growth suburbs. But if the entire property market’s bubble bursts or some unforseen factor drives prices down (natural disaster, industry collapse or over development) then you could be stuck with a property losing money with no capital growth. • It’s harder to build a big property investment portfolio as you have to outlay so much cash. Unless your pockets are very deep, the sheer costs of negatively gearing will prevent you from having as many property investments as you may like. At least in the short term. • It prevents you from being agile – you’re tied down to a property in the long term. If you’re a small-medium investor this limits your overall investment options. Say if some fabulous investment opportunity arises, you may not be able to tap into it because you’re committed to the long term capital growth of your property and may not have free cash available.
So there are very strong arguments both for and against negative gearing. At the end of the day, you’re best to talk to a professional about what choice will work for you. Many investors come asunder through hasty or poorly informed decisions. And with so much fevered interest in the current property market that’s not a mistake anyone wants to make. 
SAM KHALIL is founder and director of <a href="https://www.dpn.com.au/" target="_blank">Direct Property Network</a>.
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The pros and cons of negative gearing: DPN's Sam Khalil

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A new Deloitte report says that while negative gearing gets the blame, it is the 50% capital gains tax discount that has been mostly under-appreciated for frenetic property speculation.
Doubling the length of time an asset has to be held before it is eligible for a capital gains tax break - from 12 months to 24 months - was an option that needed consideration, the report suggested. 
Another options suggested for reform included reducing the size of the discount to 33.3 %. 
"The current . . . discount is too generous, to the extent that it undermines the very principles of this nation's progressive income tax system," the Deloitte report says.
It suggests 33.3% as this is what super funds are eligible to receive. 
Currently capital gains on an asset sold within 12 months are not eligible for any CGT discount.
It is the second "myth-busting" report released by Deloitte as part of its contribution to the tax reform debate.
While overused, negative gearing was not the "evil" force many believe it to be, the report advised. Shares and other assets can also be negatively geared.
Another "skeleton in the closet" for the Australian taxation system are the carried-forward capital losses, the report suggested.
The ATO calculates carried forward losses as at 2012-13 at $8 billion for individuals, $35 billion for companies and $33 billion for super funds.
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Capital gains tax discount more to blame for property bubble than negative gearing

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In their submission to the House of Representatives Standing Committee on Economics, the Australia Institute state not only is current tax treatment putting upward pressure on house prices but are also encouraging speculative behaviour and increasing the chances of property bubbles and financial instability. 
"Negative gearing has been a part of the Australian tax system from early last century. In the context of residential housing investment it allows property investors to write off any losses against their taxable income from other sources. This effectively means that the tax payer is paying for some of the loss. 
"The CGT discount was introduced in 1999 and means that for assets held for more than a year only 50% of the capital gain is taxed. This decreased the amount of CGT paid, and means capital gains become increasingly important to property investment."
The effect of the GCT discount can be seen in the Net rental income table 1995-2013.
<a href="/images/2015/08/26/Screen%20Shot%202015-08-26%20at%202.26.13%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/08/26/Screen%20Shot%202015-08-26%20at%202.26.13%20PM.png" alt="">
"After the introduction of the CGT discount net rental income collapsed. Investors were willing to take on significantly larger losses at a time when they could keep a larger slice of the capital gain. 
"In a normal investment market if the return on the asset was going down because the price of the asset was rising then this would be a signal to investors that it could be overvalued and would decrease the interest in investing. 
"But an interest in capital gain means that a rising price is a signal to enter the market because future capital gain is likely. Such a situation makes speculative bubbles more likely. 
"While middle and lower income households are being increasingly shut out of home ownership, most of the benefits of negative gearing and the CGT discount flow to high income households. 
"Modelling done by NATSEM for the Australia Institute shows that 55 per cent of the benefits of negative gearing and the CGT discount flow to high income households, while 50% of families only get 13% of the benefit. Figure 3 shows the income distribution of the negative gearing and CGT discount benefits. 
<a href="/images/2015/08/26/Screen%20Shot%202015-08-26%20at%202.28.03%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/08/26/Screen%20Shot%202015-08-26%20at%202.28.03%20PM.png" alt="">
The Australia Institute does not believe that changes made to negative gearing would decrease investment and increase house prices. AI claims that there is already little investment into property with just six per cent of investment finance going to new housing.
"The other 94% is spent on existing stock. If the objective of negative gearing is to encourage new housing then this could be achieved by restricting negative gearing to apply only to new housing. 
"The Australia Institute proposes that negative gearing is restricted to new housing stock and only for a period of 10 years.
"The CGT discount replaced a system where capital gains were discounted by the inflation rate. The argument for the CGT discount is that it is a simpler method for calculating and taxing the real capital gain. 
"The broader question that should be considered is why we tax real capital gains but level all other taxes on the nominal gain. For example, interest earned on money is taxed at the nominal interest rate rather than the real interest rate. 
"Given that all other taxes are levelled on the nominal gain and not the real gain there is little justification that capital gains should be taxed differently. The Australia Institute proposes that the CGT discount should be abolished. 
"These changes will have a number of effects. It will decrease demand for housing and hence put downward pressure on house prices as potential investors pick other investment opportunities. 
"It creates a bigger incentive for new housing. It reduces the speculation in the residential housing market, making property bubbles and financial instability less likely. Finally it will raise $7.4 billion a year in revenue at a time when the government is trying to decrease the budget deficit."
 
The Australia Institute report outlined the case for abolishing the capital gains tax discount – not capital gains tax as previously headlined.
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Abolish capital gains tax discount: Australia Institute

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The Property Council of Australia has welcomed comments from Treasurer Joe Hockey reported in the Weekend Australian that there is “no merit” in changing negative gearing for residential property.
"As the Government's analysis shows negative gearing is used overwhelmingly by people working in some of our most valued, but lower paid professions,” its chief executive Ken Morrison said.
“Negative gearing is a well-established, long-standing part of Australia's tax system and the people who use it most are everyday Australians looking to get ahead.
“This isn't some tax lurk for the wealthy, it is a legitimate and effective part of our taxation system that is used most by people earning under $80,000 per annum who become property investors through their own hard work.
“Any changes to negative gearing would hit middle Australia hardest and would take away one of the best ways most people have to save for their retirement.”
The Property Council of Australia says in 2012-13 almost 36,000 nurses and midwives, 10,415 emergency service workers, 53,855 teachers, 10,255 social workers and 90,000 clerical staff all earning around or less than $80,000 per annum declared a net rental loss.
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PCA says negative gearing is for everyday Australians

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Negative gearing is a very controversial issue. The latest round of debate stems from the Reserve Bank’s submission to the House of Representative Standing Committee on Economics regarding the enquiry into home ownership. The Bank believed that “there is a case for reviewing negative gearing”.
Treasurer Joe Hockey promptly responded to again rule out any change of the tax policy on negative gearing. In particular, it was reported that he claimed that removing negative gearing would create “an exception to a standing rule in taxation law”.
Is negative gearing in accordance with well-established tax rules? A fundamental principle in the tax law is that a taxpayer should be able to deduct expenses only if the expenses have been incurred to generate assessable income.
This is why an employee can only deduct expenses that are sufficiently related to work. For example, a funeral director at tropical Queensland would be able to deduct the cost of his black jacket (but not his black trousers) because the ATO believes that no rational person – except a funeral director – would wear a black jacket in such a hot place.
Should mortgage interest on an investment property be deductible? Investment properties generate two kinds of income: rental income and capital gains (if any). As capital gains on investment property can enjoy a 50% tax discount if the property has been held for at least a year, strictly speaking only 50% of the interest expenses related to the capital gain should be deductible.
In practice, it is impossible to predict whether there will eventually be a capital gain, and also impossible to predict the amount of the gain. This presents the key difficulty in the design of the tax policy on negative gearing.
Allowing full deduction of the interest expenses every year effectively allows deduction of expenses that may be incurred to generate the tax free portion of the capital gain (if any), and therefore may violate the fundamental tax principle for deductions. However, how can the Australian Tax Office (ATO) determine how much of the interest expenses should be disallowed every year before the investment property is actually sold?
Many countries resolve this issue by quarantining losses on investment properties. It means that losses generated from negative gearing cannot be used to offset against other sources of income, for example, salaries or business income. Instead, the losses can be carried forward to future years to offset against income from the investment properties.
This policy is fair in the sense that the same tax principle for deductions applies to both taxpayers with and without negative gearing. Many countries adopt this quarantine policy, including major developed countries such as the US, the UK, France and Japan.
Some countries have even stricter tax rules on investment properties. For example, China allows a fixed 20% deduction of the rental income, and the Netherlands tax property investors on a deemed yield rate of 4% on the value of the properties. In other words, these countries do not allow deduction of any tax losses on investment properties at all.
Australia’s current tax policy on negative gearing seems overly generous when compared to both groups of countries. More importantly, it is not fair to taxpayers who do not have negative gearing. The policy effectively subsidies negative geared property investors through the tax system.
The Reserve Bank concluded its submission to the enquiry into home ownership by rightly stating that “policy should not unduly advantage property investors at the expense of prospective owner-occupier home buyers … tax and regulatory frameworks should avoid encouraging over-leveraging into property”.
Of course, the negative gearing issue is complex and highly political. The ATO’s Tax Statistics for 2012-13 showed that taxpayers claimed a total of $12 billion tax losses from investment properties, and almost 1.3 million taxpayers had negative gearing.
The sheer number of taxpayers currently enjoying the benefit of negative gearing dictates that it will demand strong political will and leadership before a politician is willing to propose changes to the current tax rule on negative gearing.
Even if the government is bold enough to change the rule, careful consideration has to be given to transition rules to cater for the existing taxpayers that have negative gearing. This is a story for another day.
Antony Ting is associate professor at University of Sydney and also an author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/antony-ting-117958" target="_blank">here</a>.
 
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