Landlord Investment Update Q2 2026
Landlord Investment Report June Quarter 2026 Dear Valued Landlord, The legislation has now passed. Back in May we wrote to you about what was proposed on budget night. That’s no longer a proposal — negative gearing changes, the capital gains tax discount changes, and the minimum tax on discretionary trusts are now law. The headlines have had their run. The more useful question now is a practical one: what does this actually mean for you? What’s Actually Changed (A Quick Recap) + Existing investment properties remain under the current negative gearing rules until they are sold. + From 7.30pm budget night, newly purchased established investment properties no longer access negative gearing or the 50% capital gains tax discount. + These concessions are retained for newly built investment properties and owner-occupied homes. + From July 2027, broader changes extend to a wider range of asset classes, narrowing tax advantages across investments. + Discretionary (family) trusts are now subject to a minimum tax arrangement. We’ll continue to share these updates each quarter. If there’s ever something specific you’d like us to cover, or if you want to talk through your property in more detail, our team is always here.
BRONTE MANUEL
Director + Owner
M 0439 828 882 E bronte.manuel@toop.com.au W brontemanuel.toop.com.au
WHAT THIS ACTUALLY MEANS FOR YOU
+ If you already own an investment property Nothing changes for you today. Your property keeps its existing negative gearing entitlements for as long as you hold it, however CGT discount changes are brought into effect from 1st July 2027.
+ If you’re considering buying an established property You’ll no longer be able to negative gear the loss annually or access the 50% CGT discount on sale. Losses can still be carried forward and offset against the eventual capital gain — so the benefit isn’t gone, it’s deferred.
+ If you’re considering buying new Negative gearing and the CGT discount are retained for newly built investment properties. This is a genuine tax advantage the legislation preserves — but it also means more marketing dollars will be chasing your attention in this space over the next year. A tax concession doesn’t make a development a good investment on its own; due diligence still matters more than ever.
+ If you’re thinking about selling Existing properties keep their current negative gearing entitlements until sale, however CGT discount entitlements will change as of 1st July 2027. If you’re weighing up timing, it’s worth a conversation with your accountant and your property manager together, since the right call depends on your personal circumstances, not the legislation in isolation.
Dwelling values in Adelaide rose 1.3% in June and 11.6% over the past 12 months
THE NEGATIVE GEARING SCENARIO IN PRACTICE
To put this in real terms, consider a typical investment property purchase, geared at 90% LVR: ITEM
AMOUNT
Purchase price
$1,100,000
Loan to Value Ratio (LVR)
90%
Mortgage amount
$990,000
Interest rate
6.5% ($64,350 p/a)
Rental income
$700 p/w ($36,400 p/a)
Other expenses (rates, insurance, maintenance)
$11,000 (1%)
Under the old negative gearing system, this scenario delivers the following annual tax savings depending on marginal tax rate: MARGINAL TAX RATE
ANNUAL TAX SAVING
16%
$6,232
30%
$11,685
37%
$14,412
45%
$17,528
(excl. Medicare levy)
Under the new rules for properties purchased since budget night, these losses can no longer be claimed annually — instead they are carried forward. If an investor consistently carried rental losses of $17,528 for 10 years and then sold, they would have $175,280 in claimable losses to offset against the capital gain. From a longer-term perspective, inflation erodes the value of money over time, so losses claimed in 10 years will be worth roughly 25% less in relative terms than they are today. In the shorter term, the loss of the annual tax saving may also slightly hinder some investors’ borrowing capacity.
DOES THIS CHANGE HOW WE INVEST?
The table below illustrates a $1,100,000 property growing at 5.8% p.a. — the average annual growth rate over the last 20 years. In every year, the annual No. Buying well has always come down to location first, land holding second, and build/construction infrastructure third — and this doesn’t change any investment decisions based on tax settings or this legislation. Good real estate will always outperform any removed tax benefit. YEAR
PROPERTY VALUE
ANNUAL GROWTH ($)
1
$1,163,800
$63,800
2
$1,231,300
$67,500
3
$1,302,700
$71,400
4
$1,378,300
$75,600
5
$1,458,200
$79,900
6
$1,542,800
$84,600
7
$1,632,300
$89,500
8
$1,726,900
$94,600
9
$1,827,100
$100,200
10
$1,933,000
$105,900
CGT EXEMPTION CHANGES
Scenario + Home purchased 10 years ago: $503,000 + Current value (based on real growth data): $1,100,000
CURRENT RULES
PROPOSED INDEXATION METHOD
Sale price
$1,100,000
$1,100,000
Original cost base
$503,000
$503,000
Indexed cost base
N/A
$613,700
Gross capital gain
$597,000
$486,300
CGT discount
50%
Nil
Taxable capital gain
$298,500
$486,300
Based on this scenario, approximate tax payable under the old and new methods is as follows: MARGINAL TAX RATE
CURRENT RULES
PROPOSED INDEXATION METHOD
16%
$47,760
$77,808
30%
$89,550
$145,890
37%
$110,445
$179,931
45%
$134,325
$218,835
Note: expenses including interest, maintenance and insurance haven’t been factored into this table, as this becomes complex depending on whether losses are negatively geared and claimed along the way, or carried forward and deducted on sale under the new system. It does, however, provide an apples-for-apples comparison of the potential variance in CGT payable between the two schemes.
WILL THE CGT CHANGES AFFECT THE MARKET?
No. This change applies across all asset classes — shares, art collections, car collections and more — not just real estate. It doesn’t tip the scales toward another investment class over property. If the change applied only to real estate and not to shares, the story might be different.
ADELAIDE MARKET SNAPSHOT
To bring this back to our own backyard, here’s where Adelaide sits according to Cotality’s latest Monthly Housing Chart Pack (July 2026): METRIC
ADELAIDE
Dwelling values — 3 months to June 2026
+1.3%
Dwelling values — 12 months to June 2026
+11.6%
Rolling 28-day growth (to 14 July 2026)
-0.2%
Current status
At a record high
Median days on market (Jun-26 vs Jun-25)
28 days vs 34 days
Median vendor discount (Jun-26 vs Jun-25)
-3.8%, widened from -3.4%
Annual rental growth
+4.8%
Gross rental yield
3.5%
New listings (year-on-year)
+8.6%
Total listings (year-on-year)
+17.8%
Adelaide continues to be one of the stronger-performing capitals nationally, still sitting at a record high despite growth moderating slightly in the most recent 28day read. Homes are also selling faster than a year ago, though vendors are now discounting a little more to get deals done — both signs of a market that is cooling gently rather than turning. Rental growth and yields remain healthy. Source: Cotality, Monthly Housing Chart Pack, July 2026.
FORECAST FROM HERE
Fundamentally, Adelaide and Australia as a whole have an undersupply of housing, with no way of building the required numbers in the short term. State Government projects such as the River Torrens to Darlington (T2D) Project, the Women’s and Children’s Hospital, and AUKUS are paying trades enormous sums to lure them away from private building and onto public projects — this is likely to make the housing shortage worse. Negative gearing changes, CGT changes, and removing leverage on residential property within super funds won’t change the strategy of the seasoned investor. However, 70% of property investors own just one property — sometimes by accident, sometimes on purpose. When you only make one or two buying decisions across 10–20 years, it’s easy to get swept up in the headlines.
This played out in 1985, when the Hawke Labor government quarantined negative gearing on properties purchased after 17 July that year. Investors pulled back, rents rose sharply in Sydney and Perth in particular, and after sustained pressure from the property industry over rents and falling vacancy rates, negative gearing was reinstated in September 1987. The current Labor government’s theory is that tenants will now have the opportunity to buy properties that would otherwise have been purchased by investors. On a broad scale, this may be marginally true — but consider the tenant renting the $1,100,000 property above for $700 p/w ($36,400 p/a). To buy that property, they would need $175,708 in savings and the ability to increase their weekly outlay from $700 in rent to $1,474.23 in mortgage and outgoing payments.
FORECAST FROM HERE
Purchasing costs ITEM
AMOUNT
Deposit (10%)
$110,000
Stamp duty
$54,330
Registration of transfer
$11,378
Total
$175,708
Holding costs ITEM
AMOUNT
Mortgage $990,000 @ 6.5% – 30 years, P&I
$1,262.69 /mo
Rates, insurance, maintenance ($11,000 p.a.)
$211.54 /mo
Total
$1,474.23 /mo
If investors keep buying, rents remain stable. If investors stop buying, most tenants won’t convert into owners, and rents will rise. When rents rise, property prices follow — and when replacement (build) costs increase, established housing prices increase too. Right now, the only thing holding back continued double-digit growth in Adelaide is affordability. Approximately 45% of household income is currently going toward mortgage repayments — historically, when we hit this level the market plateaus, growing only 2–4% for a few years before the next upswing. This time may be different: replacement values are rising, there are more tenants than properties (a gap that could widen further), and Adelaide is now a recognised city in its own right — no longer perceived as a country town.
For those of you who already own an investment property, you are in a small percentile, and well positioned. If you would like to discuss your property, your portfolio, or simply what this means for your situation, please don’t hesitate to reach out to your property manager or the TOOP+TOOP team.
TOOP+TOOP Strengthens Adelaide Hills Presence with New Stirling Office TOOP+TOOP has strengthened its presence in the Adelaide Hills through the acquisition of Belle Property Adelaide Hills, including its established office at 50 Mount Barker Road, Stirling. The acquisition brings respected Adelaide Hills real estate identity Phil Crowder and his team to TOOP+TOOP, uniting two highly regarded local teams under one roof. Phil is joined by Elsie Burvill and Angelica Curtis, who will work alongside our established Adelaide Hills advisors, Anita Hardingham and the Lindsay team of James Lindsay, Bronwyn Lindsay and Sarah Phillips. The expansion also represents an important step forward for our property management services throughout the region. Property Manager Jolyon Oakey has joined forces with TOOP+TOOP Property Manager Bianca Basso, bringing together their local knowledge and experience to provide landlords and tenants with dedicated support from our Stirling office. For our landlord clients, this means greater onthe-ground support, an expanded local network and access to a team that understands the distinct characteristics of the Adelaide Hills rental market. The acquisition builds on TOOP+TOOP’s longstanding connection to the Adelaide Hills and reinforces our commitment to delivering trusted property advice across both sales and property management. Our Adelaide Hills team is now operating from 50 Mount Barker Road, Stirling, providing a central and accessible location for landlords, tenants, homeowners and buyers throughout the Adelaide Hills.
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This is a general market promotion. Please disregard if you have already enlisted another agent. RLA 301302