Property investors can breathe a sigh of relief as negative gearing looks to be off the chopping board for now. The government has observed that rather than it allowing the rich to get richer, negative gearing is used by many low to middle class earners as a nest egg for retirement.
Analysis from the federal government reveals that negative gearing is used overwhelmingly by people working in lower paid professions. This corresponds with the Property Council’s analysis showing that 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 each year declared a net rental loss. “Many hard-working Australians have invested money in real estate … to give themselves some financial security,” Hockey said.