Survey data suggests many landlords would pause buying or consider selling if tax settings are tightened ahead of the May budget
A majority, or 61%, of Australian property investors say they would reduce their exposure to residential real estate if the Labor moves to wind back two long-debated tax settings, according to a survey commissioned by price comparison website Money.com.au.
The research found 39% of property investors said they would step back from buying investment property, or sell existing holdings, if the 50% capital gains tax (CGT) discount on the sale of investment properties were reduced. A further 22% said they would take similar action if negative gearing concessions were capped or limited to a single property.
Not all investors expect to change course. The survey found 39% of property investors said neither policy would affect their decision to keep investing in real estate.
The survey results come as the Australian government weighs possible changes to investment property tax settings ahead of the 2026–27 Federal Budget on 12 May.
Investor intentions varied by state. South Australia (45%) and Queensland (42%) recorded the highest shares of investors saying a CGT discount reduction would lead them to pull back—above the national result—compared with 38% in NSW, 39% in Victoria and 33% in Western Australia.
Responses to potential limits on negative gearing were less consistent across states. Western Australia recorded the highest share (33%) saying they would pull back or sell if concessions were capped, followed by NSW (25%) and Victoria (22%), with lower proportions in Queensland (16%) and South Australia (11%).
Nick Burgess (pictured right), mortgage expert at Money.com.au, said the changes could affect rental supply and pricing, and may not translate into improved affordability for renters seeking to buy.
“If property investors pull back or consider selling, that has real implications for rental prices, as fewer investment properties means fewer homes available to rent, which can push rents higher,” he explained.
“Some investors may also increase rents to offset the impact of these changes on their returns or delay selling or hold out for higher prices to maintain their after-tax returns. It also raises questions about whether these changes will genuinely improve housing affordability. Not every Australian renter is in a position to become a homeowner due to lending serviceability requirements and the ballooning costs of homeownership, including stamp duty, council rates, insurance and maintenance.
“The research suggests some investors may scale back or shift away from property towards other asset classes, but it remains to be seen how material the impact would be in practice.”
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