If you’ve glanced at the news since the Federal Budget was handed down on May 12, you might think the sky is falling on the Australian property market.
Whilst the media’s focus in on the broken promise & the headlines are screaming that the government has scrapped negative gearing. And whilst it is true that housing policy is experiencing a massive pivot, the reality of the situation is very different from what the headlines suggest. Negative gearing has not been scrapped—it has simply been carved out to focus 100% on new builds to protect and encourage housing supply. So here at One Park Lane, we are celebrating the 100% focus that investors now are now encouraged to have on our style of product.
When reading these sensationalist headlines, it is important to remember that around 80% of the media in this country is owned by just three or four major companies. For example, News Corp owns REA Group, which in turn owns both realestate.com.au and Mortgage Choice—one of Australia’s leading mortgage and home loan brokers. They have a massive vested interest in maintaining the status quo for established housing, which explains at least some of the overwhelming negative bias you are currently seeing in the press.
The “New Build” Exemption: Negative Gearing is Still Here
To understand why this budget is a win for off-the-plan investors, like you, you have to look at what happened to the established market (second hand).
For ‘second hand’ properties purchased after 7:30 PM on May 12, rental losses can no longer be used to reduce tax on your personal salary. They must now be “quarantined” and carried forward.
However, for an investor buying an off-the-plan unit such as One Park Lane, the rules remain effectively unchanged. Because properties like One Park Lane “genuinely add to supply,” they are fully exempt from this crackdown. You can still negatively gear these properties and offset net rental losses against your personal taxable income.
The Truth About Capital Gains Tax (CGT)
The budget also included changes to Capital Gains Tax (CGT) that apply across the board to all properties. While the media is portraying this as a disaster, the actual impact is highly manageable & does not affect new builds. Here is the straightforward math:
- Currently, the top rate of tax is 47%.
- Under the old system, a 50% discount applied, bringing the effective top tax rate down to 23.5%.
- Under the new budget rules, a minimum 30% tax rate will apply to net capital gains – after accounting for inflation during the ownership period
- Investors in new builds will have the ability to choose to from either the original 50% discount or the new indexed Capital Gain Growth, with a minimum 30% tax on that adjusted gain.
Realistically, your effective tax rate on capital gains may move from 23.5% up to 30%. While no one loves paying more tax, an extra 6.5% upon the eventual sale of your property is a very minimal impact in the grand scheme of a strong, wealth-generating investment.
The Shift in Investor Dollars & Rising Values
Because the CGT changes apply to everyone, Negative Gearing is now the single biggest tax advantage left in the Australian property market—and it is only available on new builds.
The Treasury’s goal with this budget is clear: redirect investor capital away from bidding up existing houses, and funnel it directly toward the construction of new stock.
| Feature | Second Hand/Existing Property | Off-the-Plan / New Build |
| Negative Gearing | Abolished (Losses are now quarantined) | Retained (Offset against your income) |
| CGT Treatment | 50% Discount (effective minimum rate of 23.5%) | Indexation 30% Minimum Tax or 50% Discount – Investors Choice |
| Intended Policy Outcome | Government reduces investor demand | Government increases investor demand |
While we prefer to deal in facts rather than speculation, basic economics dictates that when you funnel the country’s property investment capital into one specific sector, values in that sector are highly likely to increase.
Why We Are Celebrating at One Park Lane
We are looking at these changes as a major cause for celebration. Moving forward, smart investors simply won’t be buying second-hand homes anymore. Instead, investor dollars will shift entirely toward new, off-the-plan developments.
Most importantly: Your property in One Park Lane can still be negatively geared. For a landmark new development like One Park Lane, this legislative shift creates an incredible environment for capital growth and sustained investor demand. Ignore the media noise—the future for off-the-plan property investment has never looked brighter.
Project Update: Momentum Building at One Park Lane
In addition to the highly favorable legislative outlook, we have some exciting project-specific news to share. This week, our Melbourne-based development team held highly productive meetings with land surveyors and the Gold Coast City Council. Following these discussions, we are incredibly confident in our timeline to complete the land swap by mid-June, with contracts expected to follow shortly thereafter. For more details on the land swap, see previous editions
Around this same time, we will also be firming up and securing the procurement orders for the residential and vehicle elevators for both the main building and the basement. The momentum behind One Park Lane continues to build rapidly, and we look forward to keeping you updated as we cross these major milestones.
Disclaimer: We are not tax or financial advisors. The contents of this article are intended for general informational purposes only and should not be construed as professional financial advice. It is always best to speak with a qualified tax or financial advisor regarding your personal investment strategy and how these budget changes may specifically impact you.
