Everyone’s talking about what the 2026 Federal Budget takes away. The mood across most investor commentary has been bleak.
We’re going to talk about something different. We’re going to talk about what the budget opens up.
Here’s the thing. We can’t change what the government does. But we can absolutely change our strategy.
Last updated: 28 May 2026
The 2026 Federal Budget changes the tax treatment of negative gearing. Your bank changes something just as important: how much they’ll lend you in the first place. Each major lender is moving at a different pace, and the bank you choose this month can meaningfully change what you can actually buy.
Here’s where each of the major lenders sits right now:
Macquarie: Policy live. First mover. Already factoring the changes into serviceability.
NAB: Hard deadline 26 may Tuesday. Applications must be unconditionally approved by close of business 26 May 2026 to keep current policy.
Suncorp: Hard deadline 27 May Wednesday. Applications must be unconditionally approved by close of business 27 May 2026.
ANZ: Hard deadline 28 May Thursday. Applications must be unconditionally approved by close of business 28 May 2026.
CBA: Hard Deadline 28 May. Policy change at 11:59pm AEST Thursday 28 May 2026.
Westpac: Holding. Current policy applies until legislation passes.
Three hard deadlines this week. If you have an investment loan application in flight, the lender you’re with and the day you’re at matter more than usual right now.
Lender choice has always mattered. Right now, it matters more than usual. Talk to Madd Loans about which lender is best positioned for the specific play you’re running.
Important. This is general information only. It’s not financial, tax or legal advice. The measures discussed are announced policy and haven’t yet been legislated, so details could shift. Before you act on anything here, talk to Madd Loans, your accountant and a licensed financial adviser.
The budget measures discussed in this guide are announced policy and remain subject to legislation; details may change. Before making any decision based on this guide, you should consult a licensed financial adviser, a registered tax agent or accountant, and a qualified solicitor as appropriate for your circumstances.
Treasurer Jim Chalmers handed down the 2026 Federal Budget on 12 May. The changes that matter most for property, investing and retirement are:
Three big shifts. One thing left alone. Let’s go through each and look at how you actually play it.
The investors and homeowners who’ll come out ahead over the next decade aren’t going to be the ones who panicked or pulled out of the market. They’ll be the ones who saw a new set of rules and built a new playbook around them.
If you already own your home, you’re sitting on something the budget just made more valuable than it was last week. Your property is grandfathered. That means it can be turned into a fully negatively geared investment any time you like, under the old rules, without ever buying into the new regime.
There are two plays here. Which one fits depends on what you want from your next move.
The PPOR upgrade flip. Buy your next home as a standard owner-occupier purchase. You don’t claim negative gearing on a home you live in anyway, so nothing’s lost there. Then turn your current home into a rental. Because you owned it before 12 May 2026, it keeps full negative gearing under the old rules. You’ve upgraded your home and picked up a fully negatively geared investment property in one move.
The rentvesting play. Don’t move into anything new. Keep your current home, rent it out as a fully negatively geared investment, and rent somewhere you actually want to live. Under the six-year rule, your old home can still qualify as your principal place of residence for capital gains tax purposes for up to six years after you move out. Sell within that window and the capital gain can still be tax-free. Subject to proper structuring and advice from your accountant and solicitor, this is one of the cleanest plays in the new environment.
Both plays rely on the same insight. You already own something the new rules can’t touch. Use it.
If you’re buying as a pure investor, the playbook resets. Established residential property bought from 13 May 2026 onwards is structurally less attractive than it used to be. Here’s where the opportunity goes instead.
The new build pivot. New builds keep full negative gearing and let you choose between the old 50% CGT discount and the new indexation regime when you sell. They’re the only path that preserves both tax shields. Expect a lot more investor attention here over the next two years. Watch construction costs while you’re at it, because they’re likely to climb as demand floods into the build market.
Knock-down-to-multi-dwelling on development-zoned lots. This one needs a careful read of the rules. A “new build” under the budget is defined as a property that adds to housing stock. Knocking down one house and rebuilding one house does not qualify. Knocking down one house and replacing it with two or more dwellings (a duplex, townhouses, units) does qualify.
That makes existing properties on larger lots with the right zoning genuinely more interesting than they were a month ago. Look for R3, R4 or medium-density zoning. Look for sites where dual occupancy is permissible. The house you buy might be a tear-down, but the dirt and the zoning are doing the heavy lifting.
Subdivision of larger existing sites. Same logic from a different angle. If you can subdivide a block and build new dwellings on the new lots, those new builds qualify under the rules. If you already own a property with subdivision potential, that potential just got more valuable.
Land banking. Builders and developers are about to be heavily incentivised to add supply. Demand for development-ready land is going to climb. The play is to position yourself in front of that demand, either to develop yourself, or to sell the dirt to a developer down the track. It’s more speculative than the other plays, and timing matters, but it’s a legitimate new lens for investors with the appetite for it.
This is the biggest mindset change in the whole budget.
The old playbook was simple. Buy a low-yield property in a prime suburb, accept the negative cash flow, ride the capital growth. The 50% CGT discount made the eventual sale enormously tax-efficient.
That playbook gets harder under the new rules. From 1 July 2027, capital gains are calculated using cost base indexation and taxed at a minimum of 30%. For high-growth, low-yield assets, the after-tax outcome on sale gets meaningfully worse.
So the strategy shifts. Yield matters now in a way it didn’t before. Duplexes, blocks of units, dual-occupancy sites, properties with granny flats. Anything that throws off real rental income becomes structurally more attractive. The 1–2% yield prestige play in a blue-chip suburb still has its place, but it’s no longer the default investor strategy.
There’s also a crystallisation question to consider. If you’re sitting on significant unrealised gains in existing property or shares, there’s a window between now and 1 July 2027 to review whether selling under the current 50% discount makes sense. For anything you hold through, get a 1 July 2027 valuation locked in. Quantity surveyor schedules and CGT valuations become more important under the new regime, not less.
If you’re buying a home to live in, the budget actually opened a window for you.
Investors are stepping back from the lower end of the established market. The townhouses, units and entry-level houses that first home buyers actually compete for. Less investor competition at that price point means more breathing room.
Meanwhile, rents are likely to climb. Landlords losing the tax buffer have an incentive to push rents higher to make the numbers work. If you’re renting and watching that play out, the calculation gets sharper. Getting into the market sooner is more attractive than waiting it out.
One nuance worth flagging. The new build market is now investor-tilted, which means new build pricing is likely to firm up faster than established stock. If you’re a first home buyer, your strategy probably shifts the other way. Look at established properties, not new builds. The competition is thinner and the pricing is friendlier.
Your borrowing capacity isn’t affected by any of the changes, because you don’t claim negative gearing on a home you live in anyway. The play is to get serviceability assessed, get pre-approval lined up, and move.
Just as important as the changes are the things the budget left alone:
The property market just split in two. Investors win on the new-build side. Owner-occupiers and first home buyers win on the established side. For the first time in a decade, those two groups aren’t fighting over the same stock.
The CGT changes aren’t just a property story. From 1 July 2027, the shift from the 50% discount to indexation plus a 30% minimum tax applies to all CGT assets held by individuals, trusts and partnerships. That includes long-held share portfolios, ETFs held outside super, and business sale exits.
Same crystallisation question as property. For anything sitting on substantial unrealised gains, it’s worth a conversation with your adviser about whether realising before July 2027 makes sense, or whether holding through under the new regime is the better call. The answer depends on your marginal rate, the size of the unrealised gain, and what you’d do with the proceeds.
From 1 July 2028, distributions from discretionary trusts will face a 30% minimum tax rate. The policy intent is to limit income splitting to low-bracket beneficiaries.
A few things to keep in mind before reacting.
Rollover relief is coming. The government has indicated it will provide rollover relief next year to allow restructuring without triggering CGT. That’s a meaningful window. Don’t restructure in a panic. The path to a more efficient structure is being built into the legislation.
Companies become more attractive as pure investment vehicles. Under the new regime, a corporate beneficiary or a holding company starts to look better than a discretionary trust for purely tax-driven investment portfolios. Where you invest from matters more than it used to.
Trusts aren’t dead. They still offer things no company can match. Asset protection, intergenerational planning, succession flexibility, distribution discretion. If the additional tax cost is modest relative to what the structure does for you, holding might still be the right call. Trusts have always had more flexibility than companies. The tax advantage has narrowed; the flexibility hasn’t.
Carve-outs to note. SMSFs and complying super funds, fixed and widely held trusts, deceased estates, charitable and special disability trusts are all excluded. Primary production income and certain income for vulnerable minors is also carved out. If your trust structure falls into any of these categories, the change may not affect you at all.
You have until July 2028. Plenty of time to get the right advice and make the right call. Just don’t sit on it indefinitely.
The question isn’t just what to invest in anymore. It’s what entity to invest from. For most investors, the structure conversation hasn’t been worth having in years. It is now.
Nothing inside super changed. No tweaks to contribution caps. No changes to the way benefits are taxed. Super funds keep the one-third CGT discount on assets held more than 12 months.
What that means is the interesting bit. Because everything outside super got hit and super didn’t, super has just become relatively more attractive as a holding vehicle for long-term growth assets. The same share portfolio held personally now faces indexation plus a 30% minimum tax on capital gains. Held inside super, it keeps the one-third discount.
The play is to lean in. Where it fits your stage of life and your broader plan, maximise concessional and non-concessional contributions. The case for parking growth assets inside super rather than personally just got stronger.
SMSFs and complying super funds are explicitly excluded from the 30% trust distribution tax. They keep the one-third CGT discount. They keep their existing arrangements.
If you’re considering your next investment property purchase, it’s worth a conversation with your accountant about whether holding through an SMSF makes more sense under the new rules. The tax position is materially better than holding in your own name or through a discretionary trust.
One small note. The government is consulting on changes to the super performance test. There’s no action required yet, but watch this space if you’re with a fund that’s been on the borderline.
When everything around it got more expensive and super didn’t, super effectively got cheaper. The same dollar of growth held inside super is now worth materially more than the same dollar held outside it.
Pull back from the detail for a moment and look at what’s actually happened.
The rules around property investment shifted. The rules around investment structuring shifted. The rules around capital gains shifted. But the underlying logic of building wealth through property, shares and super didn’t shift at all. You’re still going to want growth assets. You’re still going to want yield. You’re still going to want tax efficiency. You’re just going to get there through a different path.
The investors who win the next decade aren’t the ones who panicked. They’re the ones who restructured. Become part of the change instead of waiting for things to change on your behalf.
If you’re a current homeowner, talk to Madd Loans about how the PPOR upgrade flip or rentvesting might fit your situation. If you’re an investor, get your finance strategy aligned with new builds, multi-dwelling sites or development-zoned land. If you’re a first home buyer, get your pre-approval moving, because your window has just opened a little wider. And if you’re closer to retirement, the super conversation matters more now than it did a month ago.
Don’t sit still. But don’t sprint either. The biggest changes don’t kick in until July 2027, and the trust changes not until July 2028. There’s time to do this properly, with the right advice from Madd Loans, your accountant and your financial adviser.
Don’t stress about finding the best loan. We’ll handle it! Answer this quick question, and we’ll search our extensive network to find the ideal loan for you for free.
Awesome! We’ll get right on this. Please fill out the form and the team will be in touch.
This includes:
Awesome! We’ll get right on this. Please fill out the form and the team will be in touch.
This includes:
Awesome! We’ll get right on this. Please fill out the form and the team will be in touch.
This includes:
Awesome! We’ll get right on this. Please fill out the form and the team will be in touch.
This includes:
