What the Budget Could mean for Investors, Landlords, Renters and Home Buyers

The 2026 Federal Budget has reshaped the housing policy debate. Here’s what changed, what Mark Bouris is questioning, and what it could mean for buyers, investors and families planning ahead.

Treasurer Jim Chalmers used the budget to target two long-debated areas: negative gearing and capital gains tax. The government says the reforms are designed to make it easier for owner-occupiers, especially first home buyers, to compete for homes and to direct more investor money toward new housing supply.

That is the policy aim. But as always, the real question is what these changes will do in practice.

Changes at a Glance

Negative gearing will be restricted to new builds

From 1 July 2027*, investors who buy established residential properties after budget night won’t be able to deduct rental losses against their wages or other non-property income in the usual way. Existing holdings are grandfathered, and new builds keep the more favourable treatment.

Capital Gains Tax

The Federal Government has announced proposed changes to the capital gains tax discount. From 1 July 2027*, the current 50% CGT discount for eligible assets will be replaced with cost base indexation plus a 30% minimum tax on capital gains. Transitional rules apply.

What it could mean for first home buyers

For first home buyers, the government’s main aim is straightforward: reduce investor competition for existing homes and improve access to ownership for first home buyers.

Treasury modelling says the reforms could help create around 75,000 additional owner-occupiers over the next decade. In simple terms, the government expects some homes that may otherwise have been bought by investors to instead be bought by people planning to live in them.

That could be especially relevant at the entry level of the market, where first home buyers and investors often compete for the same stock.

Treasury also expects house price growth to be about 2% lower relative to no policy change over a couple of years. That does not mean prices are expected to fall by 2% across the board. It means growth may be slower than it otherwise would have been.

What it could mean for investors and landlords

For investors, this budget creates a divide between new builds and established properties.

If you already own investment property purchased before budget night, the grandfathering rules are important. They preserve the existing treatment for those holdings.

If you buy an established property after budget night, the position changes. You may still be able to deduct rental losses, but only against residential property income, rather than other taxable income. That reduces one of the long-standing tax advantages associated with negatively geared property.

The CGT changes are also significant. From July 2027*, the tax outcome on future capital gains may be less generous for some investors than under the current 50% discount model, depending on returns, inflation and tax position.

That may affect investor confidence, especially for those focused on established dwellings and long-term capital growth. It may also push more investors to consider new housing instead, since that is where the policy settings remain more favourable.

For landlords, the big watchpoint will be how the market adjusts. If fewer investors buy established properties, rental supply in some areas could tighten further unless new supply lifts enough to offset the shift.

Mark Bouris reacts

Mark Bouris’ response focused less on the policy headline and more on what these changes may mean for families over time.

If policy pushes more investors and some buyers toward a narrower pool of eligible properties, price pressure in that segment becomes a real issue to watch.

Mark also flagged something many borrowers will care about just as much as tax policy: inflation and interest rates. He said he wanted to test the budget’s broader economic impact, including what it may mean for inflation, rates and the wider economy.

That matters because tax changes are only one part of the housing story. Borrowing power, confidence and repayment pressure still do much of the heavy lifting.

The bottom line

The 2026 Federal Budget may yet make it easier for some first home buyers to compete for existing homes. It may also reshape how investors think about established property, new builds and long-term returns. But the outcome is not guaranteed.

The government says the reforms will support owner-occupiers and direct more investment into new supply. Critics, including Mark Bouris, argue the changes may weaken a familiar wealth-building pathway and risk shifting price pressure into the new-build segment. 

For most Australians, the smart next step is not to react to headlines alone. It is to understand how these changes could affect your own plans, timeline and borrowing options.

Whether you are buying your first home, refinancing, or planning your next move, a mortgage broker can help you look at the full picture. 

Reach out for an obligation-free chat with your local YBR Home Loans expert who knows how to the lending market for you. This is the time to get clarity, test your thinking, and chart the best path forward for you and your circumstances. 

*The initiatives announced in the 2026 Federal Budget are subject to the passage of legislation.