On the night of 12 May 2026, the Federal Government confirmed the end of negative gearing on established residential properties and changes to CGT across property, shares, and other assets. It is the most significant shift to property tax settings in a generation.
This article covers what actually changed, what did not, and what it means for investors making decisions right now.
What Changed and What Didn't
Two separate changes were announced. They need to be understood separately.
Negative Gearing on Established Properties
From 1 July 2027, negative gearing on established residential investment properties is limited to new builds.
If you purchased before 7:30pm AEST on 12 May 2026, nothing changes. Your existing arrangements are grandfathered until you sell.
If you buy an established property after that date and time, you can still deduct losses against residential property income, rent or future capital gains, but you can no longer offset those losses against other income like wages.
New builds are fully exempt. Investors buying new builds retain access to negative gearing under the existing rules.
Capital Gains Tax
From 1 July 2027, the 50% CGT discount that has applied to all assets, property, shares, businesses, is being replaced with inflation-adjusted indexation, with a minimum tax rate of 30% on realised gains.
For long-term holders, this is a material shift in how your eventual sale is taxed, not just how losses are treated along the way.