The latest Federal Budget has introduced proposed changes that could reshape property investment across Australia. While these reforms are not yet law, they signal a clear shift, and it’s important to understand what they mean for you.
Here’s a quick snapshot:
- Negative gearing likely limited to new builds from July 2027
- The 50% CGT discount proposed to be replaced with indexation + a minimum tax
- Existing properties largely protected (grandfathered)
So, what does this mean?
For most current landlords, there’s no immediate impact. Existing investments are expected to remain under current rules, meaning no forced selling or sudden change.
However, future investment decisions, particularly when buying established properties, may come with reduced tax benefits, which could influence buyer demand.
A shift towards new builds
The changes are designed to push investor activity into:
- Off-the-plan properties
- Build-to-rent developments
- New house and land projects
This could create a split market between new and established stock.
What about renters?
While the short-term impact is expected to be modest, over time:
- Fewer investors may purchase established rentals
- Rental supply could tighten in some areas
- This may support upward pressure on rents
The opportunity for landlords
With fewer investors entering the market, existing landlords may benefit from:
- Stronger tenant demand
- Improved rental growth in undersupplied areas
The key takeaway
This is not an overnight shift, but a longer-term change in how property is taxed and where investment flows.
If you’d like to understand how these changes may impact your property or investment strategy, our team is always here to help.
Warm regards,
Betty Drennan | Director
Morton Property Management