Landlord: 'Nasty tax won't get a cent of my property gains'

By Anne Gibson

Property investor David Whitburn. Photo / Supplied
Property investor David Whitburn. Photo / Supplied

Investor says Labour plan punishes those trying to provide for their own retirement.

Nine years ago, David Whitburn had $7000 and a handful of shares.

Today, he has more than $1 million equity in his property portfolio and says Labour will never get a cent with its "nasty" capital gains tax (CGT).

"That's because I'm not selling, ever. My children will inherit these places," he said, adding that Labour's plans would damage New Zealand.

Mr Whitburn, who is the Auckland Property Investors Association president, said many of the clients of his real estate mentoring scheme might leave New Zealand if the tax came in.

"They can earn higher wages in Australia, and investing in New Zealand with a friendlier property tax climate is what's keeping them here. Why would they invest in New Zealand when they can get better capital in Australia?

"This is a nasty tax that discourages those who want to get ahead and not be a burden on fellow taxpayers in retirement. It's not aspirational and is a new tax that's not needed. Why punish those making an effort to provide for themselves?

He said the tax would also have unintended effects. "Rental prices will be pushed up with fewer property investors investing. House prices may be pushed up by property investors holding on for a lot longer, making the dream of home ownership that step too far for a number of people."

For Mr Whitburn, buying property has been his making. He gets rent from six houses and five minor dwellings which are home to more than 40 people in West Harbour, Massey and Ranui.

"I've got all the places in trusts and have no plans to sell," said the multimillionaire. "I'm getting an income and using that to pay down the debt on my own home. In two years I'll be debt-free with lovely views of Rangitoto and the Sky Tower.

"If there's fear about another property boom this shows lack of understanding by politicians about property cycles. What we saw from 2003-2007 was just another boom, much like in 1993-1997.

"Property markets move in cycles the world over whether there's a CGT or not," Mr Whitburn said.

Andrew King, vice-president of the Property Investors' Federation, lashed out at wide-ranging exemptions.

"If a CGT is the right thing to do, it's the right thing to do for all assets. Politics shouldn't come into it. Private home buyers account for about 70 per cent of purchases so have a greater effect on the market than anyone else."

- NZ Herald

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