Landlords ‘leveraging up’ by exploiting property tax rules are fuelling Australia’s housing affordability crisis, analysis finds

The e61 Institute analysis has found that Australia's capital gains tax discount and negative gearing rules are fueling property speculation and worsening the housing affordability crisis by creating artificial incentives for debt-leveraged investment. The combination of these two tax breaks has "turbocharged" speculation over recent decades, according to the research, which examined hundreds of thousands of property investments. The federal government is expected to announce changes to these tax provisions in the upcoming budget in three weeks as part of efforts to rebalance the housing market. These tax rules have allowed investors to accumulate excessive debt against property assets while benefiting from preferential tax treatment on gains, exacerbating competition for housing and pricing out first-time buyers.