I joined Terry Condon to talk through what the proposed tax changes and an uncertain rate outlook mean for home buyers and investors. The short version: know your numbers, hold a buffer, and avoid knee-jerk moves.
Listen to the full episode:
https://open.spotify.com/episode/3x8cW4mvSjFAje77AF5sO5
I recently joined Terry Condon on his podcast to talk through what the proposed negative gearing and capital gains changes, alongside an uncertain rate outlook, mean for people buying a home or building a portfolio. You can listen to the full conversation above.
The budget put forward changes to how negatively geared investment properties are treated. The measure has passed the House of Representatives and heads to the Senate next. Nothing is law yet. Even so, the market has already started to move.
What I'm seeing is a split. Some people have paused while they wait for the dust to settle. Others are reading their own numbers and carrying on. We went back to every client with an investment pre-approval written under the old assessment and re-ran it, so no one was caught short near settlement.
Rates are one. Every quarter per cent rise trims what you can borrow by about two per cent, so a pre-approval can shrink while you shop. Bank selection matters here, because some lenders honour the original capacity and some re-test it. The proposed changes are the other. With the negative gearing benefit no longer fed into serviceability, some banks have already cut investor borrowing power by around a quarter. We're assessing investment deals against the new rules now rather than chasing a window that probably won't last.
The budget hasn't changed borrowing capacity for owner-occupiers at all, and my advice there hasn't changed either. Decide whether you're buying a home or buying for growth, because the two briefs pull in different directions. Then make sure you can hold the place if rates rise twice more. A buffer sitting in your offset is what stops a market dip turning into a forced sale.
The holding cost of a new investment property is higher than it was before May. The capital gains benefit still arrives, just later, when you sell. That first year can feel like all cost and no relief. With borrowing power into property reduced, I expect more people to weigh debt recycling into shares against a straight property purchase. Both are valid. The right call comes from the numbers, not the headline.
We treat fixing as buying certainty, not beating the market. One and two-year fixed rates sat around 6.34% across the majors at the time we recorded. Banks price market moves into those rates before they happen, so a fixed rate is rarely a free kick. We tend to have this conversation with people stretched to the top of their capacity, and we usually keep a portion variable for the flexibility to make extra repayments or change course.
If you want to model it yourself, our Fixed vs Variable Rate Calculator shows what your repayments look like now and under a few rate rises.
No one knows where rates go from here. Inflation prints one day and unemployment the next, and the odds flip with them. That's the case for planning rather than predicting. Know your numbers, hold a buffer, and lean on good advice. Rule changes become noise when the rest of your position is sound.
The latest Cotality data says national home values flatlined in May. That is not what our discovery calls sound like. Our Q2 read lays the numbers over what clients are actually telling us, from defensive equity moves to the budget rattling investors.
Guide · clientsBorrowing capacity is the most common question we hear. Here's what lenders measure in 2026, why the 3% buffer matters most, and why two lenders can land more than $200,000 apart on the same household.
Thirty minutes, no cost, no obligation. We'll listen, sketch the options, and tell you straight whether we can help.