Industry veteran Brian White, chairman of Australasia’s largest property group the family owned Ray White, slammed the now public insight into federal policy-makers thinking during the last election, warning “don’t forget the past”.
His comments come in the wake of recently released documents which contained Treasury advice to the government warning of a “softening” effect on property prices as the predicted impact of Labor’s restrictive changes to housing policy.
At the time, the real estate industry rallied together, led by Brian White, to oppose any changes to negative gearing policy, a hot-button issue during the 2016 election campaign.
“These newly released Treasury documents further vindicate the position the real estate industry took during the last election. We all opposed the changes proposed by the Labor Party to negative gearing and capital gains tax,” Mr White said.
“Even more important than modelling are historical trends. The only time similar changes to property taxation were previously attempted was under the Hawke Government in the mid-80s resulted in a devastating effect that forced the Labor government to reverse their policy a short time later,” he said.
“It was the worst time for property owners since the credit crunch of the Whitlam era, with so many Australians significantly affected in the worst possible way.
“The outcome was so bad, Labor themselves had to revert their own decision after just 18 months.
“These changes were introduced when the property market had been quite strong so there’s no telling how a second attempt would play out in a market that’s already softening.
“The Australian Labor Party should know better than anyone how badly these type of changes would affect our country’s economy, given this all occurred during their term of Government.
“A stable property market is fundamental to a strong economy. Based on the data we reviewed at the time of the election, more than 10 per cent of all taxpayers from all walks of life use negative gearing but when property prices fall, it also affects the 67 per cent of Australians who own their own home.
“Not forgetting the 18 million Australians who have a stake in property through their super funds.
“What is clear is that implementing radical policies in this arena doesn’t work and causes more harm than good.
“We have to learn from previous mistakes and that is the essence of good policy.”