For property investors, the recent tax changes have sparked interest in buying new.
Changes announced in the 2026–27 Federal Budget will limit negative gearing on residential property to new builds from 1 July 2027, with existing investments held before the 12 May 2026 announcement protected under the previous arrangements. Investors purchasing established property after the announcement will still be able to carry forward rental losses and offset them against residential property income, but generally won’t be able to use those losses to reduce other income such as salary and wages.
That creates a legitimate tax advantage for some investors considering new property.
But does that automatically make a new property the better investment?
Not necessarily.
Why buying new looks attractive
There are several reasons new property can look appealing.
In addition to the changes to negative gearing, investors buying qualifying new residential property can generally claim depreciation on eligible new fixtures and fittings that may not be available when buying those same assets second-hand.
That can improve the after-tax cash flow of a new investment.
However, the biggest mistake an investor can make is allowing the tax treatment to determine what and where they buy.
Tax benefits may improve the numbers around an investment, but they can’t turn an average property in an inferior location into a great property.
Ultimately, capital growth is driven by the underlying asset.
New doesn’t stay new
There is another issue investors need to consider.
You may receive a tax advantage because you’re buying the property new. But when you eventually sell, the property is no longer new.
The next investor buying it generally won’t receive the same new-build negative gearing treatment that attracted you to the property in the first place.
That matters because part of the demand supporting some new developments may be coming from investors specifically seeking those tax advantages.
When it comes time to sell, your buyer pool could look very different.
You’ll need the property itself — its location, land component, design, amenity and owner-occupier appeal — to create demand.
Newness is temporary. Location isn’t.
The resale market matters
When we’re assessing an investment property, we don’t just think about today’s investor.
We think about tomorrow’s buyer.
Ideally, an investment should appeal to more than one segment of the market.
A well-located townhouse in an established Brisbane suburb might appeal to investors today, but also to downsizers, young professionals, first-home buyers or families when it eventually comes time to sell.
That depth of demand can be extremely valuable.
By comparison, an investment purchased primarily because it was new, offered a particular tax treatment or was marketed heavily to investors may have a narrower resale market.
That doesn’t automatically make it a poor investment. It simply means the underlying property fundamentals become even more important.
Property fundamentals should come first
Tax should absolutely be considered when assessing an investment property, but it should be considered after the fundamentals. This is where working with an experienced Brisbane investment property buyers agent can help you compare the underlying quality of different opportunities, rather than simply focusing on the incentives attached to them.
We would generally start by assessing:
- location and long-term demand
- scarcity of the property type
- land component
- owner-occupier appeal
- rental demand and achievable yield
- future supply in the surrounding area
- quality of the dwelling
- infrastructure and amenity
- likely resale market
- price compared with alternative properties
Then the tax implications can be layered over the top with advice from your accountant or financial adviser.
A useful question for investors to ask is:
If the tax benefits disappeared tomorrow, would I still want to own this property?
If the answer is no, it may be worth looking more closely at the investment itself.
So, does buying new make sense?
Absolutely — when the underlying property stacks up.
A quality new townhouse, apartment or house in the right location can offer strong rental demand, owner-occupier appeal and the added benefit of favourable tax treatment.
The risk is buying a lesser property simply because it is new.
Property is a long-term investment. Tax rules and government incentives can change over time, but the fundamentals of what you buy remain.
For Brisbane investors, our view is simple: consider the tax benefits, but don’t let them drive the decision. Buy the best property your budget allows, in the best location you can.
At Setlr Buyers Agents, we help investors compare opportunities across Brisbane based on location, value, rental performance, future demand and long-term resale appeal — not just the incentives available at the time of purchase.
Tax circumstances vary between investors. Buyers should obtain independent tax and financial advice regarding how the current and proposed tax arrangements apply to their individual circumstances.
Seeking Advice with Purchasing Investment Property?
At Setlr, we are the Brisbane buyer’s agent you can rely on for all your property buying needs. Whether you are interested in purchasing an investment property or a new home for your family, we’ll help you find the best property for the best price. Give us a call on 1300 1SETLR, send an email to hello@setlr.com.au, or access our online contact form to get started today.