Report proposes negative gearing compromise

NEGATIVE gearing should be abolished for investment in existing housing, but kept for new homes to help supply more housing, a new report argues.

The McKell Institute report, released on Thursday, suggested a compromise as the political debate on housing heats up in Canberra.

Report author Professor Richard Holden said his research showed because most of the 1.26 million investors using negative gearing were investing in existing property it was "doing nothing to improve rental availability".

"Instead we should be encouraging that investment toward new housing stock," he said.

It comes as Greens Senator Scott Ludlam pledged to move for a "full debate" on housing affordability when the Senate sits next week.

Sen Ludlam said he hoped for an "evidence-based debate" on housing supply and rental affordability.


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