Carrington Clarke

And so there is a legitimate discussion there, isn't there, about, well, does the government provide certain targeted relief at times when we're seeing inflation grow?

Or what is the appropriate setting without adding too much to demand and making the problem worse?

But the government is talking about, on one hand, the importance of dealing with intergenerational equity issues.

And that does seem to be part of the conversation.

It does look perhaps they are going to try to make this a major reforming budget with changes to things like negative gearing and capital gains tax and the taxation on trusts.

What's your take about, first of all, the situation that they're in, how difficult this is right now with the high inflationary situation, and also those issues that at this point are at least speculated about being changed in this budget?

And making decisions about what you're prioritising.

Yeah.

And why do you think we're once again staring potentially down the barrel of changes to negative gearing and capital gains tax discount?

Why are they still something that the government might think needs to be changed?

And what impact have they had on house prices, which does seem to be the focus, even though they both can affect other types of investments, can't they?

Yeah.

And by loss, we mean that the amount that you're paying on interest repayments and to maintain the property costs more than what you're receiving from the rent.

And the higher the marginal income tax rate that they're paying, actually the bigger advantage it is for them to be negatively geared, right?

Because it comes off that-

Especially if they're grandfathered and the rules don't affect people who have existing assets.

Yeah.

And that is the constant refrain that the government is most interested in more supply when it comes to dealing with the housing price pressures that we're seeing.

But it does appear that part of the framing of this change will be about fairness, that they don't want

first-home buyers competing with people who are investing in the market.