2026 Federal Budget Live Reaction: Negative Gearing Scrapped and CGT Changed

The 2026 Federal Budget has landed. Negative gearing on established property is gone for future purchases. Capital gains tax changes are confirmed. The rules every Australian property investor has been operating under for decades changed on Budget night. Reece Beddall and Lachlan Delahunty deliver their live reaction with everything unpacked and a clear framework for what investors need to do next.

What the Budget Actually Changed on Negative Gearing

Negative gearing on established residential property is removed for new purchases from Budget night. Existing investors with properties purchased before the Budget date retain grandfathered access to negative gearing deductions for as long as they hold those assets. The change applies to future purchases only.

The practical implication: the cost of holding an established investment property has increased for every new buyer from this point forward. Investors considering purchases in Sydney and Melbourne, where gross rental yields are already below holding costs, need to reassess the return case without the negative gearing deduction.

The Capital Gains Tax Changes Explained

The CGT changes alter the discount available on investment property held for more than 12 months. The specific mechanics affect when investors should sell, how long assets should be held to optimise tax position, and whether the after-tax return case for certain asset classes changes materially. Reece and Lachlan walk through each scenario with clarity.

What Investors Should Do in the 24 Hours After the Budget

The first 24 hours after a major policy change is when the noise is loudest and the decisions are most likely to be wrong. Reece and Lachlan are specific about what investors should do (review your existing portfolio’s tax position, talk to your accountant, do not transact on emotion), what to avoid, and where the actual opportunities created by these changes are beginning to appear.

Published: 12 May 2026