Negative Gearing Ends 1 July 2027: 11 Investment Property Buyers Agent FAQs

From 1 July 2027, negative gearing is off the table for established residential investment properties in Australia.* If you're buying an investment property in the next couple of years, the playbook that worked for your parents' portfolio doesn't apply to yours anymore.

So as a property investment buyers agent, here are the eleven questions we get asked most right now, from what's actually changing, through to how it should shape the brief you hand your buyer's agent before you even start looking.

What is changing with negative gearing in Australia?

Negative gearing on established residential property is being phased out. Once the new rules kick in, you won't be able to offset rental losses on an established home or unit against your other income anymore. New builds are carved out entirely, they keep their negative gearing eligibility and that's already reshaping the split between new build and established briefs we're seeing from clients.

When do the negative gearing changes start?

1 July 2027. But here's the important bit: if you exchanged contracts (meaning you signed and committed to the purchase, even if settlement hasn't happened yet) before 7:30pm on 12 May 2026 Budget Night you're grandfathered under the old rules (meaning the old rules keep applying to you, even after the new ones kick in for everyone else), regardless of when settlement actually happens.

Is negative gearing grandfathered if you already own the property?

Yes. If you owned it, or had exchanged contracts, before 7:30pm on 12 May 2026, you keep negative gearing under the current rules for as long as you hold that property.

What happens if you bought after 7:30pm on 12 May 2026?

If you exchanged after that cut-off, your established property falls under the new rules once they land on 1 July 2027. You can still hold it and rent it out, you just lose the ability to offset a rental loss against your salary or other income from that date.

What replaces the 50% capital gains tax discount?

The 50% discount is being swapped for Consumer Price Index (CPI) indexation of the cost base, basically, the original price you paid for the property, plus certain costs, adjusted upward for inflation each year plus a flat 30% minimum tax on real capital gains. In practice, this changes the maths on capital gains tax on investment property held for the long term, particularly if you're a higher-income investor who's been leaning on that 50% discount to bring down your taxable gain at sale.

What counts as a new build under the new rules?

Generally, a property bought off-the-plan or newly constructed, not an existing dwelling changing hands. New builds keep negative gearing under the reforms, plus you get a choice between the old and new CGT treatment when you sell.

Does the negative gearing benefit pass to the next owner?

No. It attaches to the build status and purchase timing for the investor who bought it new, it doesn't automatically transfer with the title if it's later sold as an established home to a new investor.

Should you buy an established investment property before 1 July 2027?

For a lot of investors, yes this is genuinely the last real window to lock in negative gearing on an established asset. But look, don't make the decision on tax treatment alone. The fundamentals of the property still need to stack up on their own. This is exactly the kind of thing a buyers agent for investment property should be modelling for you before you commit, not after.

What does the after tax holding cost look like from FY2028?

If you buy established after the cut-off, you're holding without the negative gearing offset from FY2028, so your after-tax holding cost climbs in line with your marginal tax rate (the tax rate you pay on your next dollar of income, the higher your income, the bigger the hit). Worth reviewing your likely investment property tax deductions under both scenarios, grandfathered and non-grandfathered, before you commit to either path, ideally as part of a broader property investment strategy rather than a one-off decision.

Established vs New Build: What Changes Under the Reforms

Negative gearing (post 1 July 2027): Established — only if purchased before 7:30pm 12 May 2026. New build — retained.

CGT treatment: Established — CPI indexation + 30% minimum tax. New build — choice of old or new treatment at sale.

Grandfathering: Established — based on exchange date. New build — not applicable, new rules assessed from purchase.

Resale to a new investor: Established — loses any grandfathered benefit. New build — buyer assessed under new build rules again.

How does this change the brief you give an investment property buyers agent?

Since 12 May 2026, the briefs we're getting have shifted noticeably. Clients who'd previously asked a buyers agent investment property search to focus on established homes exclusively are now wanting both established and new build options side by side, so they can compare the after-tax outcome before deciding.

On a recent purchase for one of our clients, this side-by-side comparison changed the final decision entirely and that's the kind of thing a lender's or accountant's blog post just can't give you, because it depends on current stock and current market conditions, not historical averages.

Working with an investment property buyers agent north shore clients trust or anywhere else, for that matter means that comparison happens as part of the search, not after you've already fallen in love with a property.

What should a property investment advisor check before you sign?

They should be checking your exchange date against the 12 May 2026 cut-off, confirming whether the asset genuinely qualifies as a new build under the reforms, and modelling your after-tax cash flow under both the current and post-2027 rules before you sign, not after.

Speak to an investment property buyers agent about your next purchase

If you're weighing up an established purchase before the window closes, or want new build options modelled side by side, my team's happy to help. We work with investment property buyers agent Brisbane clients relocating their portfolio interstate, as well as those staying local, and as a buyers agent for investment property Australia wide, we're seeing this shift play out in almost every state.

Whatever the strategy, if you're after a buyers agent sydney investors trust, book a call with our team before the 1 July 2027 changes reshape what's actually on the table.

* Refers to the Treasury Laws Amendment (Tax Reform No. 1) Act 2026, which received Royal Assent on 26 June 2026. The negative gearing and CGT provisions commence 1 July 2027. This reflects the law as it stood at the time of writing. Always confirm current tax rules with your accountant before acting.

Investors rethinking structure because of these changes often look at super, and our walkthrough of buying property inside an SMSF in NSW sets out how that works. For the purchase itself, our guide to buying a NSW house for investment purposes covers the ground rules.

This article is general information only, not personal tax advice. Speak to your accountant or financial adviser about your own circumstances before acting.