REINZ concerned about ring-fencing rules
REINZ concerned ring-fencing rules could make rental ownership a less appealing investment choice
If you’re writing on the Revenue Minister’s Taxation (Annual Rates for 2019-20, GST Offshore Supplier Registration, and Remedial Matters) Bill this weekend, please consider the following comment from the Real Estate Institute of New Zealand (REINZ).
Bindi Norwell, Chief Executive at REINZ says: “REINZ is concerned about the impact the proposed loss ring-fencing rules may have on New Zealand’s rental market, particularly in high-density residential areas that already attract high rent prices.
“We consider restricting the use of rental losses for investors could negatively influence the rental market, either by investment property owners passing on the cost of the reduced benefits to renters through increased rental prices or making rental ownership a less appealing investment choice. This may lead to a reduction in rental properties, thereby increasing pressure on the rental market and driving up rental prices,” she continues.
“This is particularly undesirable in the current environment whereby home ownership is at its lowest level in 60 years and the number of people living in rental accommodation is increasing at a greater rate than those living in their own homes,” she concludes.