"It won't change anything for property investors who are in it for the long haul. It's actually quite a good move, what the Government are doing."
While there were not many speculators in Wairarapa, there were some tradesmen and renovators who would have to be careful, he said.
"Anyone who frequently buys a home and does it up while living in it, and then sells it for a profit, is really running a trading business. These people should be taxed under existing law, so the bright line test simply makes this clear."
Property Brokers Wairarapa manager Guy Mordaunt said he expected enforcement of the test would have little effect on the property market in Wairarapa, where annual gains tended to be much smaller than in places like Auckland.
"If you bought a property and sold it in two years in Masterton, it wouldn't go up much in value, so people here don't tend to do that, they tend to be longer term."
Only one house sold by Property Brokers in the past sixth months would probably fall under the "bright line" rules, he said.
In terms of a percentage of the market, only a few people were renovating and selling for a gain within two years, Mr Mordaunt said.
"There are definitely people who buy houses and do them up and sell it in six months, certainly, but not massively. People who know what they are doing make money doing that."
He expected the new test would be difficult to prove and people would still try to avoid paying tax.
Revenue Minister Todd McClay said the test was an important step in the Government's plans to bolster the tax rules on property transactions.
"The new bright line test removes any doubt about a seller's 'intention' and makes it clear that all property buyers, including overseas buyers, who buy and sell a residential property within two years, will be taxed on their gains."
The only exemptions are a person's main home, property that is transferred under a relationship property settlement and inherited property.
The closing date for submissions is July 24.
