Most people who invested in residential properties are subsidizing the renter as they lose money every year. That why you have Negative Gearing.
An average residential investment loses between $6k to $8k a year. Imagine if the Gov have to fork out $6k to $8k per rental??? That's $18B per year.
Further, Negative Gearing Only gives 45% (assuming they are on the highest marginal tax rate) back to the property owner, in the form of tax refund. So on a negative geared property of $6k (ie. $6k loss), the property investor only gets back $2,700. And loses $3,300 per year.
That is the $3,300 per rental, per year ($10B per year) is the Gov saving. On top of that, the Gov doesn't have to fork out the money to build the rental property.
That's why they push it out to the private sector.
