What changed
Under laws passed in 2026, negative gearing for residential property is limited to new builds from 1 July 2027. Properties held at 7:30pm AEST on 12 May 2026 are exempt. Separately, the 50% capital gains tax discount is replaced by indexation plus a 30% minimum tax, for gains that accrue from 1 July 2027.
Side by side
| New build | Established | |
|---|---|---|
| Negative gearing (bought after 12 May 2026) | Available from 1 July 2027 | Limited from 1 July 2027 |
| Depreciation | Generally higher | Generally lower, especially fittings |
| Land value share | Often lower, especially in estates | Often higher in established suburbs |
| Price against comparables | Can carry a premium | Easier to test against recent sales |
| Maintenance | Lower early on, with builder warranties | Can be higher, depending on age |
| Rent starts | After construction finishes | Immediately, or once a tenant is found |
| Key risk | Builder quality, oversupply in new estates | Hidden defects, older strata buildings |
General comparison only. Your accountant confirms the tax position for your circumstances.
A tax benefit does not make a property a good investment. Location, land value, price and rental demand still decide the outcome. We compare both options for your situation.
Common questions
Does the change affect properties I already own?
Properties held at 7:30pm AEST on 12 May 2026 are exempt from the negative gearing limit. Confirm with your accountant.
Are house and land packages a good alternative?
Some are. Test the builder, land value, price and supply carefully.
Related
General information only. It does not consider your objectives, financial situation or needs, and is not financial, credit, tax or legal advice. Rules change, so check current law and get advice from a licensed professional before acting.