Last week, the producers of Real Estate 4 Ran$om posted the 40 minute documentary for public viewing on vimeo. Real Estate 4 Ran$om is about property speculation and its impact on the broader economy.
ยป Real Estate 4 Ransom – Vimeo.com
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To say all Australians should watch this, is pointless. Nothing will change Australia’s love-mania with property. They will even buy when they shouldn’t or can’t really afford to.
The scary part is seeing that the economy here is property, all else takes a back seat. Australia has Landlords at the apex, not industrialists.
Told ya!!!
A great video, examined much of what I already have heard of before and seen elsewhere on the web.
I certainly have no issue with land tax replacing income tax, I would benefit greatly from such a change, though I believe it will never happen due to the pure greed of a small percentage of Australians who also crave absolute power as well. It’s funny how the ugly side of some humans, their greed, their lust for power…. all ties in quite nicely with real-estate.
If change comes about it will probably take a civil war to bring it on, politicians are too gutless and well feed by their greedy masters to do something beneficial for the rest of us in the name of common good.
On the whole though, I must say that most Australians look very stupid / thick headed to allow themselves to be raped this hard for so long, many other countries would have erupted in violence by now.
@ Romsey – yup, like France Greece and England. And that was just a teaser. Just wait until food and petrol become ‘luxury’ items too. Or our pensions are wiped out. It’s going to get very messy indeed.
Here’s an article I just found in a UK Mortgage Magazine:-
The exclusion of those in their twenties from the property market and overall tougher living conditions could encourage political activism, said a mortgage trade body.
The Intermediary Mortgage Lender’s Association, (IMLA) said this generation has also been let down by the destruction of the pension industry, will carry the costs of higher education and have fewer opportunities in employment.
“Inevitably a much more constrained housing and mortgage market would become a source of considerable discontent and social inequality.
At some point those affected are likely to bite back, potentially in the form of political action and there is a risk that the industry will be forced into new forms of lending,” said IMLA’s executive director, Peter Williams.
In IMLA’s Mortgage Market Review (MMR) consultation contribution, it commended the regulator’s “measured” efforts to address industry concerns, however, the future health of the mortgage and housing market is still at risk, it said.
However, trouble spots remain including interest-only and the finer detail on affordability, said Peter Williams, IMLA executive director.
He said: “IMLA’s assessment is that the direction of policy, which appears to prioritise consumer protection over consumer choice, along with more demanding prudential regulation for financial institutions, will limit mortgage supply and mortgages that are available will be more expensive. He said when you combine this with the current state of the economy you have a cocktail of ingredients acting as a cap on the ambitions of would-be homebuyers.
“Reflecting on the world we live in, there are already increasing numbers of non-standard borrowers and tighter restrictions are likely to fuel this even further. Buying a home at any point in their lives may not be a realistic option now for a higher proportion of “twenty-somethings” than has been the case since the Second World War.”
Williams said the FSA and the government must be clear on the consequences their actions will create.
Didn’t like the video. It was very good at correctly identifying the problem (property bubble) but it proposes a very flawed solution: higher property taxes.
Which would be stupid. It takes a real Nobel prize-winning ivory tower academic nitwit to think that punitive property taxes will contribute to *lower* rents. If the government listens, they’ll levy property taxes all right, but forget about lowering income tax/payroll tax/consumption tax. Let’s ask the U.S. how that idea is working out for them, shall we?
Oh, yes, and all we need is more government telling us what to do with our (privately owned) land. If it’s not “used productively” to “give back to the community” (in the government’s eyes of course) then the land owner should be taxed or fined? Ridiculous nannystate codswallop.
@Renfield
Landlords may try to hike rents, but in the end if land tax does bite, estate prices will come down and people would buy rather than rent, the general issue is that land tax would put pressure a lot of pressure on those who try to hold real estate at a loss, remember there would be no negative gearing, so much of the so called “investment ” grade stock would simply come back onto the market at much lower cost as morons try to off load their stupid speculative decisions.
Many renters would then be able to actually buy rather than rent.
Paul Keating failed with his attempt to remove negative gearing in the 1980s BECAUSE he didn’t apply a land tax against all properties, he only did half the job…… which failed.
Fantastic video, I doubt any of the greedy pigs in Government can remove thier snouts from the feed dishes they share with property infestors to make a change however.
Let’s hopes common sense and natural justice prevail…..
Living in hope.
Romsey, unfortunately negative gearing and property taxes are two different discussions. You do not solve a negative gearing problem by imposing a property tax. You solve it by eliminating negative gearing.
Keating’s move failed because it was politically unpopular with the rich, not because it affected the market badly. People didn’t like their sudden exposure to the free market, in rental or in ownership. When Keating abolished negative gearing, rents rose rapidly ONLY in those capitals where vacancy was already low – Sydney, Perth – as the rental market heated up. (A natural market movement.) In Melbourne, where vacancy was high, the rental market actually slowed, and in other state capitals it was unchanged. In other words, the rental market began behaving more naturally when negative gearing was eliminated.
Our goal should not be to encourage more people to buy, since this mentality is part of what is fueling the bubble. We need a healthy and natural rental market. However, levying property taxes only makes the government your “landlord”. You no longer own the land; the government does.
Don’t believe me? Try missing a few property tax payments and the government will soon sort out with you who owns what…as I said, if property taxes were the answer, the US property market would be booming instead of bottoming right now. No-one should be forced to “rent” their own land from a “landlord” government who then imposes whatever “rules” it wishes…such as in this video, trying to force property owners to make their property “productive” (in the government’s eyes). The answer is to allow the housing bubble to burst under its own mispricing power, and eliminating negative gearing would certainly help to accelerate that process.