Winners and losers if negative gearing slashed

First-home buyers trying to break into the hot Sunbury market could be the winners under federal Labor’s proposed negative gearing reforms, a local real estate agent believes.

Leading Real Estate director Adam Sacco said he would expect a short-term increase in investment property buyer activity if the Opposition were to win this year’s election.

‘‘People will take advantage of the chance to buy properties and negative- gear them prior to those changes,’’ he said. ‘‘But in the long term, these changes should make the Sunbury market more accessible to first-home buyers.

‘‘I don’t see the price of houses being affected greatly; [it’s] more the demographic of buyers that will probably change.”

But Mr Sacco agreed with the Real Estate Institute of Victoria, which said tenants might face higher rents.

‘‘If negative gearing is abolished investors will obviously look for a way to recoup,’’ he said.

McEwen Labor MP Rob Mitchell said the fact negative gearing would continue to apply to new houses meant supply would increase, placing downward pressure on housing prices and rents.

‘‘The dream of owning your own home is slipping out of reach for thousands of young Australians,’’ he said. ‘‘Our policy will make sure the next generation is on a more level playing field.’’

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