On top of an objective to raise additional tax revenue, Labor's preferential treatment of new property is pitched as a means to increase the housing supply. It may well achieve that end, but that doesn't mean new properties should become the property investor's top choice should they win.

Avoid too much supply

Although there may be a temporary boost to the new property sector (after the narrowing of negative gearing relief), I can guarantee that the property development industry will blow its good luck by delivering too much supply.

Negative gearing losses are only worth enduring if there is a capital gain at the end. If Labor win, investors who sign up to new property (after the inevitable post-election marketing blitz from developers) will discover that there won't be much in the way of capital gains on new property for them, so many will get burnt.

Now I envisage that under an incoming Labor administration the established property sector would initially lose some marginal investors who can't afford or aren't willing to find the extra cash flow required after negative gearing is removed and/or perceive smaller post-tax capital gains down the track.

But ultimately, the vast majority of the investing community will see that high-quality, established property will still be an important part of any investment portfolio. By the way, if Labor is elected in a few months, established property will probably see a surge in activity in advance of the new regime coming into play.

My position may seem overly sanguine to some. But my confidence is born of witnessing numerous changes to the tax code in the last 30 years that were supposedly going to seriously impair property's performance: the introduction of capital gains tax, the introduction of GST, increases in stamp duty rates, and the unwinding of stamp duty concessions for first home buyers.

History has shown that investors will thrive if they don't let taxation changes distort their asset selection process, but instead remain focused on accruing quality assets and then holding them for the long term.

Alas, the housing tax debate will undoubtedly become even more shrill in coming months. Watch out for further over-reach by both sides of politics in their pursuit of selling the merits of their policy or castigating the other side's position.

But if you have the means to invest today, do it, rather than putting it off for several months to see the outcome of a debate whose consequence won't really matter as much as the politicians would have us think.

Richard Wakelin is a director of Wakelin Property Advisory, an independent firm specialising in acquiring residential property for investors. wakelin.com.au