The Budget changed the rules on property. Here’s what investors need to know.
The 2026-27 Federal Budget landed with a thud for property investors.
The Treasurer flagged the end of negative gearing for newly purchased investment properties and the removal of the 50% CGT discount, two pillars that have underpinned Australian property investment strategy for decades.
So what does it actually mean? And should you panic?
Short answer: no.
Considered answer: it depends, and it’s more nuanced than the headlines suggest.
What’s changing — and when?
The key dates to understand:
- Properties purchased before 12 May 2026 at 7:30pm AEST: existing negative gearing and CGT rules continue to apply until you sell. If you already own investment property, you’re protected.
- Properties purchased after that cut off: negative gearing is available now but not in future years after 30 June 2027.
- From 1 July 2027: capital gains on investment assets will be taxed under a new model, cost-base indexation plus a 30% minimum tax, replacing the 50% discount that has applied since 1999.
Worth Knowing
Many investors have historically timed asset sales to coincide with a low-income year — like the year they retire — to benefit from a lower tax rate on the gain. Under the new rules, that timing advantage shrinks significantly. If you’re planning to sell an investment property in the next few years, the timing decision has just become much more important.
What does this mean for housing prices?
Here’s where it gets interesting.
Most economists expect the removal of negative gearing to moderate demand for established investment properties, particularly in the short term as investors reassess. Less investor demand can ease price pressure, which is good news for first home buyers.
However, the government has carved out an exemption for new residential builds, investors who buy new builds can still choose between the old 50% CGT discount or the new indexation-plus-minimum-tax rules when they sell. This is a deliberate incentive to keep investment flowing into new housing supply.
Longer term, less rental investment could put upward pressure on rents. The jury is still out on how that balance plays.
What should you do right now?
- If you own investment property: talk to us. Your existing property is grandfathered under the old rules, but your strategy for when and how to sell needs a fresh look.
- If you’re thinking of buying investment property: the rules for new builds are more favourable. Worth understanding your options properly before deciding.
- If you have unrealised capital gains in shares or other assets: the 30 June 2027 deadline, the last EOFY before the new CGT rules apply, is now a significant planning date. Don’t leave this to next year.
And of course: this is general information. The right move depends entirely on your situation. Contact us and we’ll work through it with you.
Plan well. Live large.
Centaur Financial Services is a Gold Coast financial planning practice helping professionals, retirees, business owners, and investors make confident wealth decisions. Based in Robina and serving clients across Australia, we’re proud to be one of Australia’s most awarded advice firms. We specialise in retirement planning and back it with institutional-grade investment capability.
This article is general information only. It does not take into account your personal objectives, financial situation or needs. Centaur Financial Services Pty Ltd is a Corporate Authorised Representative (CAR No. 342372) of Abundant Wealth Partners Pty Ltd, ABN 35 680 570 487, AFSL 564749. Please obtain personal advice before acting on any of this content.
