For Sydney Landlords
Thinking of Selling Since the Tax Changes? Run the Numbers Before You Run the Ad.
The changes to negative gearing and capital gains tax have a lot of investors reaching for the phone number of a sales agent. Before you do, it’s worth understanding exactly what changed, whether it actually applies to your property, and whether the real issue is the tax law, or how your property has been managed.
Since the 2026 Federal Budget, we’ve had a noticeable uptick in landlords asking a version of the same question: “With negative gearing and CGT changing, should I just sell?”
It’s a fair question. It’s also, in almost every case we’ve looked at, being asked before anyone has actually checked the two things that should come first: what the changes mean for this specific property, and what that property is actually capable of earning if it’s managed properly. This article is designed to help you pause on both, before you commit to a decision that’s expensive and hard to reverse.
What actually changed (and what didn’t)
- Negative gearing: the ability to offset rental losses against your salary or other personal income is being removed for established residential properties, but only for those purchased after 7:30pm on 12 May 2026. If you owned your property before that moment (including under contract awaiting settlement), you continue to negatively gear it under the existing rules.
- CGT discount: from 1 July 2027, the 50% CGT discount is being replaced with cost base indexation and a 30% minimum tax on net capital gains, for assets held more than 12 months. This applies going forward to gains accruing after that date, it isn’t retrospective on gains you’ve already accrued.
- New builds: eligible new residential properties remain exempt from the negative gearing change and can still access both negative gearing and the current CGT discount.
In other words: if you bought your investment property before 12 May 2026, the negative gearing change most likely doesn’t touch you at all, and the CGT change only affects the portion of your gain that accrues after 1 July 2027, not the gain you’ve already banked. A lot of the anxiety driving “should I sell?” conversations is based on a headline, not on how the grandfathering actually applies to that landlord’s own property.
Why “sell” is often the wrong first move
Selling crystallises a capital gains tax bill today, on the current rules. It also means giving up an asset that, over 30 years, has been one of the more reliable wealth-building tools available to Australian households, and re-entering the market later means stamp duty again, a different price point, and no guarantee of a better outcome.
Before that trade-off makes sense, it’s worth being honest about a separate question that has nothing to do with tax law: is the property actually underperforming, and if so, is that the property’s fault, or the management’s?
We regularly walk into a “should I sell?” conversation and find a property that’s been under-rented for years, sitting with a lease that hasn’t been reviewed at renewal, or carrying maintenance issues that are quietly eroding both rent and value. None of that is fixed by selling. It’s fixed by proper asset management, and once it’s fixed, the numbers behind “sell vs hold” often look completely different.
The questions worth answering before you list
- Does the negative gearing change even apply to me? Check your purchase date and contract date against 12 May 2026, 7:30pm AEST. If your property was already owned (or under contract) by then, this change isn’t the reason to sell.
- Is my property earning what it should be? Rent reviews get missed, especially with agents managing on autopilot. A property under-rented by even $40–60 a week is losing $2,000–$3,000 a year, money that changes the whole cash-flow conversation.
- What’s the actual cost of selling versus holding? Agent commission, marketing, the CGT bill crystallised today, stamp duty on whatever you buy next, and the vacancy period in between. Put a real number on all of it before comparing it to the cost of simply holding for another cycle.
- Is there untapped value sitting in the property itself? A granny flat, a cosmetic renovation, a change of tenancy type, or simply better presentation at lease renewal can lift both rent and long-term capital value, sometimes significantly more than the tax changes cost you.
- Has the property been managed as an asset, or just as a tenancy? There’s a real difference between an agent who chases up rent and one who actively manages condition, compliance, lease strategy and market positioning year-round. If it’s the former, that’s a management problem you can solve without selling anything.
Get the numbers before you get an agent’s opinion
A sales agent’s job is to sell your property, which means their advice, however well-meant, starts from the assumption that selling is the answer. Before you get to that conversation, it’s worth getting an honest, investor’s-eye assessment of what your property is actually capable of if it stays exactly where it is.
That’s the starting point of our Strategic Asset Management approach at KR Property Agents. Every new landlord who works with us begins with a comprehensive Property Performance Assessment, rent, lease, tenancy, condition, risks and untapped opportunity, followed by a practical 90-Day Action Plan. It gives you a genuine, numbers-based answer to “sell or hold,” rather than a guess driven by tax-change headlines.
Talk to Kathryn before you decide anything
A short, no-cost conversation about your property, what it’s earning, what it could earn, and whether selling actually stacks up once the real numbers are on the table.
This article is general information only, based on tax measures announced in the 2026–27 Federal Budget and current as at the date of publication. It isn’t personal financial, tax or legal advice. Whether and how these changes apply to your property depends on your individual circumstances, speak with your accountant or financial adviser before making a decision to sell.
