Tax reforms & new build opportunity

Brendan Bouton Posted on 15 May 2026

Following the Federal Budget announcement on the 12th of May 2026, there have been some major proposed changes to negative gearing and capital gains tax in Australia — and one thing has become very clear… building a brand-new home is set to become even more attractive for property investors.

Under the proposed reforms, negative gearing on established residential properties will be significantly limited from July 2027. Investors purchasing existing homes after the announcement dates may no longer be able to offset rental losses against their personal income.

However, new builds are being treated very differently.

The Government has confirmed that brand-new properties that genuinely add to housing supply will continue to qualify for negative gearing benefits. That means investors building a new home can still potentially offset interest costs, depreciation, and other expenses against their taxable income — exactly as many investors do today.

On top of that, new builds will also retain access to the existing 50% capital gains tax discount, while many other assets move to a new indexed capital gains tax system.

What this means is simple:
The Government is clearly encouraging Australians to invest in new housing supply rather than competing for established homes.

For buyers and investors, this creates a significant opportunity.

Building a new home can provide:
• Ongoing tax advantages
• Strong depreciation benefits
• Lower maintenance costs
• Better tenant appeal
• Improved energy efficiency
• And potentially stronger long-term demand as incentives shift toward new construction.

With population growth continuing, housing shortages across many regions, and infrastructure investment booming throughout much of the country, new build opportunities are becoming increasingly attractive from both a cash flow and long-term growth perspective.

At Buy Build Invest Homes, we specialise in helping clients secure quality house and land packages and new build opportunities that align with these changing market conditions.

If you’d like to discuss home and land solutions tailored to your investment strategy — and take advantage of the incentives still available for new builds — reach out to the team today.