Buying

Negative Gearing Changes: What Adelaide Property Investors Need to Know

The federal government’s changes to negative gearing and capital gains tax are now law, and they are likely to influence how many investors approach their next property purchase. Here is an overview of the key changes and some of the things Adelaide investors may want to consider.

What is changing?

Announced in the 2026–27 Federal Budget on 12 May 2026 and legislated through the Treasury Laws Amendment (Tax Reform No. 1) Act 2026, the reforms will apply from 1 July 2027. According to the ATO and Treasury:

• Negative gearing for residential property will be limited to new builds. New builds can continue to be negatively geared before and after 1 July 2027.
• Existing investments are protected. Properties held at the time of announcement (7:30pm AEST, 12 May 2026) are exempt from the negative gearing changes.
• Established properties bought after 12 May 2026 can still have losses deducted against other residential property income, including capital gains, and excess losses can be carried forward. However, those losses cannot be deducted against non-residential income such as wages.
• The 50% CGT discount will be replaced for individuals, trusts and partnerships with cost base indexation and a 30% minimum tax rate on capital gains. The CGT changes will only apply to gains that accrue after 1 July 2027.

What could this mean for investors?

Every investor’s situation is different, but the changes may lead some investors to:

• look more closely at new builds, including house and land packages and townhouses in growth areas
• place greater emphasis on rental yield and cash flow, rather than relying on tax deductions
• review their long-term strategy, including how long they intend to hold a property

The fundamentals still matter

Tax settings are only one part of an investment decision. Location, tenant demand, the condition of the property, ongoing costs and long-term growth prospects remain just as important.

In Adelaide, rental demand remains strong, with SQM Research reporting a vacancy rate of around 0.6%. Growth areas around Gawler, such as Springwood in Gawler East and the planned Concordia development, are also likely to be of interest to investors considering new builds.

Get the right advice

Because these changes are complex and depend on your personal circumstances, it is essential to speak with your accountant, tax adviser and financial adviser before making any decisions.

Where Altus can help is with the property side of the conversation. Our sales and property management teams can provide rental appraisals, discuss tenant demand in different areas and help you consider a property through the eyes of both a buyer and a future landlord.

This article provides general information only and is not tax or financial advice. For full details, see the ATO and Treasury websites and obtain independent professional advice.