Fair calls there I think malaga. I think the stamp duty encourages investors to avoid trading too much, as does the CGT discount with shares and property, which is one way of reducing speculation, probably the only good thing about the stamp 'duty' which is really just another tax as you say.
On the positive side tax wise, there is no tax on sale of place of residence.
I still think that we would all be better off if prices had not been inflated by this middle class welfare negative gearing caper. Investors in the market might be more likely to have sustainable positively geared properties in this case. Or leave the negative gearing for new builds and have an expiry of 5 years to encourage development rather than boosting prices out of reach.
If there was no negative gearing, properties would probably be cheaper, which woudl mean fewer people would have to rent, as they could afford to buy anyway.
Regardless I think with a return to low rates of capital gain, negative gearing will not be very attractive, and may phase itself out eventually.
