Property prices have accelerated recently. Photo / 123RF
Opinion
How to tackle rising house prices
Having lived for 25 years in Canada, I'm aghast at the disproportionately high cost of NZ housing relative to average income.
With no capital gains tax on property and the ability to write-off real estate investment losses against personal income, the government is encouraging investing
in non-productive entities.
The Canadian federal government's creative, visionary approach to the housing market encourages alternate investment in their capital market/Canadian infrastructure and simultaneously helps folk save for retirement.
Simplistically, here's how it works: All property became subject to capital gains tax except one's primary residence. Property investment losses were ring-fenced and only used to offset future property profits. To encourage investment in their capital market, the government legislated that through approved "mutual funds" (portfolios of Canadian companies), annual investments to a maximum 6 per cent ($13,000 limit) of one's income would be tax-free and only taxed when withdrawn on retirement through an annuity programme, ie, tax deferral at a much-reduced retirement rate.
The Registered Retirement Savings Program significantly reduced the demand by aspiring landlords and benefited a vibrant Canadian capital market.
This has application and merit in NZ. It needs a government with political foresight to enact it.
Tony Fellingham, Tauranga
15 minutes of fame
Finally I agree with Heather du Plessis-Allan on something. Her opinion piece ("Friendly fire in the National camp", October 11) is right on the money.
In the twilight of her political career, Judith Collins seems to be clutching at any straw that will grant her the 15 minutes of fame she craves. It's hard to believe National could be deemed fit to govern our country more effectively than our current administration. HDPA (who I suspect is a diehard Nats supporter) is right, they can't, they aren't ready to take the reins at such an uncertain time in our country's history.
Jeremy Coleman, Hillpark
