Quickly: income tax deductions on investment losses into property.
The general strategy is to pump money into a property at a technical loss and make it up the difference on capital gains later.
The general strategy is to pump money into a property at a technical loss and make it up the difference on capital gains later.
The negative gearing only applies to ongoing expenses (e.g. maintenance, interest, depreciation) not to capital expenses.
The original idea was that people would lower the rent to make renting more affordable. This rarely ever happens in practice because tweaks to the law mean that you can claim interest and expenses without actually renting the property (set the rental at an unaffordable price point and leave the house vacant).