Property Investment After 1 July 2027: Understanding the New Negative Gearing Rules

In Australia, the property investment landscape is shifting and it is set to change drastically on July 1st 2027. There are new negative gearing rules designed to encourage investing in new build homes. Whether you’re an experienced investor or you’re looking to get your foot in the door and purchase your very first investment property, this is our guide to the negative gearing changes so that you can make the best financial decision for you. 

What’s Changing?

Under the new regulations, investors purchasing new residential properties will continue to benefit from negative gearing allowing them to offset rental losses against their income. But, for established properties purchased after the date, rental losses will no longer be deductible against your salary or your other income. 

Instead, any losses on an already established property will be offset against future rental income from residential properties. The only expectation is existing investments which are covered by grandfathering provisions as they will remain under the current rules. 

What Does This Mean For Investors? 

For investors, this means choosing the right property has become even more important than it already was. New developments are going to become increasingly sought after because of the ongoing tax benefits while established properties may need different long-term investment strategies. 

Before you make any purchases or decisions about the kind of property you want to invest in, you should seek our professional advice to fully understand how these changes may impact you and your investment plans. 

How Can You Protect Your Investment?

Outside of seeking financial planning and advice on any potential tax benefits, there are a few different things you can do to protect your investment property – whether it’s a new build or an established property. 

One of the most important things for ensuring return on investment is a well maintained property that attracts great tenants, has lower maintenance costs and retains its resale potential. 

At Second2None Construction we can help renovate your established home to make sure it’s in the best shape for renters. Alternatively, if you’re buying new, our range of pergola services to give your investment property an edge over the competition. 

To Wrap Things Up

Australia’s property investment rules evolve quickly, and successful investors need to ensure smart financial planning and proper property maintenance in order to get the best results from their investments. 

Understanding the new negative gearing rules, choosing the right property for you and keeping your property in the best condition possible can all lead to stronger long-term returns in Australia's ever evolving and consistently competitive market.  

https://www.ato.gov.au/about-ato/new-legislation/in-detail/individuals/tax-reform-boosting-home-ownership-reforming-negative-gearing-and-capital-gains-tax

https://budget.gov.au/content/04-tax-reform.htm

https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd2526/26bd067

https://budget.gov.au/content/factsheets/download/tax-explainers-negative-gearing-capital-gains-tax.pdf