It’s remarkable how many politicians think that the solution to every problem that afflicts the housing market is to scrap negative gearing and make other changes to drum investors out of existence.

Want to fix the rental shortage? Scrap negative gearing.

Make housing more affordable? Scrap negative gearing.

Facilitate the construction of a million new homes in Australia? Scrap negative gearing.

The illogic of these attitudes – and the way they run counter to the truth – is quite remarkable.

And, while it’s become quite common for politicians and others to recommend the end to negative gearing tax benefits, none of those advocates have been able to explain how that measure would lift rental supply or improve housing affordability.

When asked for numbers, they don’t have any.

Those who hold to the view that massively punishing property investors will solve all the ills in the housing industry should ask themselves a few basic questions.

Why is it that Australia abolished negative gearing in the 1980s but within two years had reinstated it?

Why is that New Zealand, in similar fashion, banned negative gearing three years ago and is now in the process of bringing it back in?

And why is it Ireland, that ended negative gearing some years ago as well as increasing taxes on investors, now has a rental shortage catastrophe far worse than Australia has now?

History shows that every time a nation decides to scapegoat and punish property investors, rather than implement real solutions to housing problems, they end with a situation far worse than they started with.

NZ did it, partly based on the theory that deterring investors would put a lid on property prices and make homes more affordable. But NZ house prices soared, because it was home buyers pushing up prices, not investors.

Rents also rose sharply in NZ, because many investors dropped out of the market, causing a serious rental shortage.

So it’s alarming to see politicians seeking attention – and I have to say it’s usually minor parties like the Greens or independents who are grandstanding – constantly declaring that anti-investor policies will fix all the housing problems.

The latest “look at me” politician to do this is the loud and bogan independent Jacqui Lambie.

I’ve been observing Jacquie Lambie for a long time – let’s face it, she loves the limelight – and she has always struck me as someone who desperately needs counselling – constantly angry, always bombastically shouting about something or at someone – and desperately unable to articulate a coherent sentence, so it’s always difficult to understand why she’s so worked up.

So it really shouldn’t surprise me that she called a press conference recently to declare that if we wipe out negative gearing it’ll fix the rental shortage. But was unable to explain exactly how that would work. Because it wouldn’t work. It would achieve the opposite.

She also claims it would cause house prices to drop – which perpetuates the myth that somehow negatively-geared investors are the reason prices rise in Australia.

My estimate is that less than 20% of buyers in the market are negatively-geared investors. What we’re being asked to accept is that this small minority of buyers somehow overpowers the 80% plus of buyers who are home buyers or investors not claiming negative-gearing tax benefits, such as myself.

The largest and most powerful cohort in the market at any point in time, including right now, are home buyers other than first-home buyers. They are older, with higher incomes, they have equity in their existing homes, and they have considerable borrowing power – far more so than first-home buyers OR investors.

The politicians who are most vocal about squashing investors are the Greens, who would, if they had the chance, cap rents, scrap negative gearing, increase capital gains tax and impose other taxes on investors.

To get an impression of the impact that would have on the Australian rental market, if it ever happened, we can observe the situation in Ireland, which implemented very similar policies some years ago.

Today Ireland has a rental shortage catastrophe, far worse that the crisis in Australia.

Among the various reports and analysis I found on the Ireland market situation, were these comments:

“Ireland has been grappling with a severe housing crisis for over a decade, characterized by a shortage of affordable and suitable homes, rising housing costs and rents, and increasing homelessness. This crisis has had a profound impact on individuals, families, and the country’s economy as a whole.”

And here’s another comment on the situation in that country:

“Ireland’s rental market is a daunting place for households in 2024 and with demand far outweighing supply, finding somewhere to live has become increasingly difficult if not impossible. One of the biggest reasons why Ireland is facing a housing crisis is due to lower investment by developers and landlords.”

Well, if you’re going to impose policies that squash the people who supply the product that’s in short supply, what do you expect?!

In Australia, an open house for a vacant rental home will commonly attract 15 or 20 people wanting to rent it. In Ireland, the queue at a rental open house stretches out the door and down the street, literally for hundreds of metres.

Those are the consequences Australia faces if it ever implements the policies advocated by Jacqui Lambie – or the even more extreme ideas advocated by the Greens.

Let’s face it, this is nothing more than the politics of envy. Rantings from people with no vision or intelligence or expertise, just a nagging feeling that someone is better off than they are, so they need to be stopped.

And to hell with the consequences.