Property investors are weighing up their next move after the federal Budget unveiled sweeping changes to property tax rules.
The proposed reforms would:
- Limit negative gearing on residential properties to new builds.
- Replace the 50% capital gains tax discount with inflation indexation.
- Introduce a 30% minimum tax rate on capital gains.
Most changes would start from 1 July 2027.
Why current owners may see little immediate impact
The reforms would largely ‘grandfather’ existing properties.
If you already own an investment property purchased before the 12 May 2026 announcement, you’ll still be able to negatively gear it in future years.
That transitional arrangement is designed to reduce disruption and avoid a rush of buying or selling.
What buyers may do differently
If the reforms proceed, future investors may increasingly focus on:
- Newly built homes.
- Properties that add housing supply.
- Longer-term hold strategies.
At the same time, some buyers may reassess whether property still suits their goals compared to other investments.
Why structure matters now
This isn’t just a tax story – it’s also a finance story.
Loan structure, cash flow and borrowing strategy could become even more important if tax settings change.
I can help you understand how lenders may assess investment scenarios under the proposed rules and what options may suit your plans.
