Can We Fix Housing Without Hurting Investors?

From The Elephant In The Room Property Podcast | Inside Australian Real Estate Chris Bates

Negative gearing is one of the most divisive topics in Australian property—and few people are willing to have a genuine conversation about it.

In this episode, Chris Bates and Veronica Morgan sit down with renowned economist Saul Eslake to explore one of the biggest policy debates in housing, challenging long-held assumptions on all sides of the argument.

Rather than debating who's right or wrong, the conversation unpacks the economic principles behind negative gearing, the capital gains tax discount, and why tax policy shapes where Australians choose to invest. Saul explains why he believes a more neutral tax system would create a fairer economy, while Chris and Veronica question what the proposed reforms could mean for housing supply, investor behaviour, rents, and affordability.

The discussion extends well beyond property tax. They examine Australia's reliance on mum-and-dad investors, the role of institutional investment and social housing, why encouraging new housing supply matters, and whether Australia has become too dependent on property as a wealth-building vehicle. Along the way, they tackle productivity, government policy, and the difficult trade-offs involved in creating a housing system that works for both investors and aspiring homeowners.

Whether you agree with Saul's views or not, this episode offers a rare opportunity to hear a respectful, evidence-based discussion between people who don't always see eye to eye. If you've ever wondered whether negative gearing really solves—or contributes to—Australia's housing challenges, this conversation will give you plenty to think about.

Episode Highlights

01:34 – Meet Saul Eslake

05:30 – Why Property Beats Startups on Tax

10:56 – The CGT Discount Explained

14:45 – Challenging the Case for Tax Reform

16:42 – Does Negative Gearing Increase Supply?

18:12 – Do Tax Incentives Really Build More Homes?

23:07 – Who Wins, Who Loses Under Tax Reform?

28:56 – The Unintended Consequences of Reform

31:46 – Has Australia Become Addicted to Property?

34:44 – Why Social Housing Keeps Falling Short

38:32 – What Happens If Investors Leave?

41:24 – Can Supply Incentives Really Work?

45:36 – Why Cheap Apartments Are Disappearing

49:06 – Is Australia's Tax System Really Fair?

54:02 – What's Behind Australia's Productivity Slump?

59:04 – Why Higher Inflation May Be Here to Stay

About the Guest

Saul Eslake is one of Australia's most respected independent economists, with decades of experience analysing the Australian economy, public policy, housing markets and taxation. Throughout his career, he has served as Chief Economist for ANZ Bank and Bank of America Merrill Lynch Australia, while also advising governments, businesses and industry organisations on economic policy and reform.

Known for his evidence-based approach and willingness to challenge conventional thinking, Saul is a leading voice on issues including housing affordability, taxation, productivity and Australia's long-term economic future. His commentary regularly appears across Australia's major media outlets, where he helps translate complex economic issues into practical insights.

Connect with Saul

Resources

Visit our website: https://www.theelephantintheroom.com.au
If you have any questions or would like to be featured on our show, contact us at:
The Elephant in the Room Property Podcast - [email protected]
Looking for a Sydney Buyers Agent? https://www.gooddeeds.com.au
Work with Veronica: https://www.veronicamorgan.com.au
Looking for a Mortgage Broker? alcove.com.au
Work with Chris: [email protected]

Enjoyed the podcast? Don't miss out on what's yet to come! Hit that subscription button, spread the word, and join us for more insightful discussions in real estate. Your journey starts now!

Subscribe on YouTube: https://www.youtube.com/@theelephantintheroom-podcast
Subscribe on Apple Podcasts: https://podcasts.apple.com/ph/podcast/the-elephant-in-the-room-property-podcast/id1384822719
Subscribe on Spotify: https://open.spotify.com/show/3r0nnJrLUu3t1GpO7X3j6E

If you enjoyed today’s podcast, don’t forget to subscribe, rate, and share the show! There’s more to come, so we hope to have you along with us on this journey!

See you on the inside,

Veronica & Chris