Christine fears she won’t ever own a home - even with the government’s tax changes

Controversial tax changes, which the federal government insists will boost ownership, have passed their first hurdle in parliament but for lifelong renters like Christine, it is still a faraway dream.

Christine, her husband and their three children live in Sefton, about 23km away from the Sydney CBD, and pay more than $1000 a week on rent.

The couple owns a small carpentry business and, despite making enough money on paper, does not have enough to save for a house deposit after inflated bills and everyday expenses.

The family is part of a cohort of lifelong renters who fear they will never own a home, even with the government’s proposed changes to the capital gains tax discount and negative gearing.

“At this rate, the only way we’re going to be able to achieve that is if our parents die and we inherit some money from them,” she said.

“The way things are going, they’re just getting worse.”

Christine and her husband worry the small business they have run for over 20 years will have to close up shop.

“We don’t really get benefits from the government. We don’t see them at all,” she said.

“The only one is like the $20,000 write-off, which gets written off very quickly, and it’s definitely not big enough for a small company.

“We’re also not getting as much business now because people have to choose whether or not they can pay their mortgage or get renovations done or works that they need done on their place, so we are feeling those effects.”

The federal government claims its tax changes will help 75,000 people into home ownership by slowing house prices and pushing investors towards new builds, freeing up existing homes to first-home buyers.

The bill sailed through the House of Representatives this week, where Labor holds the majority vote, and will go before the Senate later this month.

That’s where the bill is set to face a sterner battle, as Labor will need the Greens to pass the Senate after the Coalition ruled out support.

But the Greens want the changes to be scrutinised in an inquiry first.

Greens Senator David Shoebridge has also criticised Labor for failing to introduce measures for renters and called for a national rent freeze.

The government has admitted its changes would increase rents by $2 a week.

Since the reform was announced in the federal budget last month, auction clearance rates and investor hesitance have marginally increased.

Data released by Cotality last month showed the preliminary auction clearance rate saw a modest increase from 57.5 per cent to 58.2 per cent.

But the figures remained under the 60 per cent benchmark for most of the last two months.

Read more

Rents to jump 350 per cent under budget measures, modelling shows

H&R Block’s director of tax communications Mark Chapman said he has seen investors hold off purchasing properties since the changes were announced to wait and see what is included in the legislation.

“There are people who are thinking of buying investment properties - their position has obviously been cast into a fair degree of uncertainty by these changes because they potentially wouldn’t be able to claim the 50 per cent discount or the benefits of negative gearing,” he said.

“So they might well be reassessing their options.”

The Australia Institute’s senior economist Matt Grudnoff, however, said he has noted greater interest from first-home buyers.

“House prices, if this were to pass, over the next five or 10 years will be far flatter, far slower in growth rates than they would be otherwise, or certainly as they’ve been growing over recent years, simply because there’s going to be less investors in the market,” he said.

But for Christine, the changes come as too little, too late and would not do much to help people like her get into the housing market now.

“We’re not going to see that and we know for a fact that at the end of our lease, our landlords are going to actually increase the rent and by a substantial amount,” she said.

“My husband doesn’t sleep very much. There’s always fights, and particularly about money, because we’re just barely getting by with insurances that we’ve got to pay, and all of the other business costs, and then we’ve got three kids that we’re raising.

“It’s really, it’s really hard and tough out there for renters.”