Following the recent Federal Budget announcement, there’s been significant media coverage around proposed changes to property investment taxation. While the headlines may feel confronting, it’s important to take a measured view - property markets have consistently adapted to policy changes over time.
Here’s a clear, high-level look at what’s been proposed and what it could mean for investors.
The reforms are aimed at reshaping investor behaviour and increasing housing supply. The main proposals include:
Negative Gearing Changes
Existing investment properties are expected to retain current arrangements. However, from 1 July 2027, negative gearing on established properties will be restricted for new purchases, with losses quarantined to property income. New builds are expected to remain fully eligible.
Capital Gains Tax (CGT) Adjustments
Future capital gains may be taxed more heavily under a revised system, reducing current concessions.
Pre‑1985 Properties
Investment properties previously exempt from CGT may begin accruing a tax liability from next year.
Trust Taxation Changes
A proposed 30% minimum tax on discretionary trust distributions may impact some ownership structures.
Change inevitably creates uncertainty - but it also creates opportunity. We may see some investors reassess their approach, particularly around older, established properties. At the same time, the fundamentals driving the property market remain strong.
- Continued population growth
- Persistent housing supply shortages
- Steady rental demand
Importantly, the proposed settings are likely to increase the appeal of new and off-the-plan properties, which continue to offer:
- Full negative gearing benefits (under the proposed framework)
- Strong depreciation advantages
- Long-term rental demand in well-located areas
For Existing Landlords: Don’t Panic
If you already own an investment property, it’s important to remember:
- Current holdings are expected to be largely grandfathered
- Quality assets in strong locations typically remain solid long-term investments
- Markets adjust over time - as they always have.
Many investors are expected to continue holding high-performing properties, particularly those delivering consistent rental returns and long-term growth potential.
A Time to Review, Not React
For some, these changes may prompt a review of strategy - whether that’s:
- Rebalancing a portfolio
- Exploring new-build opportunities
- Considering timing around a potential sale
Every situation is different, and decisions should always be made with a long-term perspective and appropriate financial advice.
As the market evolves, new housing supply is likely to become increasingly important. This is where strategic investment in quality developments may play a bigger role moving forward.
Our OC Projects team specialises in new builds and off-the-plan opportunities across South Australia, helping investors access properties aligned with these changing conditions.
Explore current opportunities here.
Whether you’re:
- Looking to grow your portfolio
- Considering selling
- Or simply wanting clarity on your next move
Our team is here to provide practical advice and support.
Get a estimate on your property here.
The bottom line: Stay informed, stay strategic, and don’t let short-term noise drive long-term decisions.
