Home ownership would rise if negative gearing is scrapped, study says

PHOTO: Three-quarters of Australian households will be better off if negative gearing is abolished, a study shows. Photograph: Getty Images.

Three-quarters of Australian households will be better off if negative gearing is abolished, a study presented to the Reserve Bank of Australia shows.

Close to 75% of households could own their own homes if the policy was axed, and house prices would soften by 1.2% while rents would rise “only marginally”, it said.

The economic modelling undertaken by Melbourne University economists was presented to a Reserve Bank workshop last month, and publicly released on Friday.

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