By Brendan Leahy, Naked Real Estate®
I need to declare two things before you read this.
First, I own an investment property myself, and I am holding it.
Second, telling you to hold costs me a listing. I would rather say what I think.
Since the May budget, investors have been ringing me asking whether they should sell.
Here is what I tell them.
Go and see a good accountant
Not a mate at a barbecue. Not me.
The goalposts keep moving, and if your property sits in a self managed super fund or a family trust it gets more complicated again. If your property is held through a trust or a self managed super fund, the rules are different again and there are further changes announced in that area. Get specific advice. The structure matters more than most people realise.
Everybody’s situation is genuinely different. Two people with identical houses can get completely different answers.
What actually changed
Two things, and they work differently from each other.
Negative gearing. If you owned your investment property before 7:30pm on 12 May 2026, you are exempt from the changes. You can keep negatively gearing it until you sell.
Capital gains tax. This one is not grandfathered, and that is where people get confused. Gains made up to 1 July 2027 still get the 50 per cent discount. Only gains after that date move to the new system of indexation with a 30 per cent minimum tax rate.
So it is split by time, not by when you bought.
The difference is smaller than the headlines
This is the part that surprises people.
Treasury’s own worked example, in its budget factsheet on the changes, follows an investor selling two years after the new rules start. On their assumptions, the tax on the gain from that period would have been about $14,100 under the old discount. Under the new system it is about $16,303.
Roughly $2,200 on a two year gain, on their numbers. Yours will be different.
That is not nothing. It is also not a reason to dump a property you were otherwise happy to keep.
Run your own numbers with your accountant. The answer will depend on your income, how long you have held it, and what the property has actually done.
Why I am telling people to hold
Look at what has happened to the rental market since the budget.
In the week ending 20 September 2026, REIWA reported 1,312 houses and 662 units available to rent across the entire Perth metropolitan area. Fewer than two thousand properties, for a city of more than two million people.
In that same week, 612 properties were leased. That is about 31 per cent of the number still sitting available at the end of it.
Meanwhile, WA still has a serious shortage of skilled labour, which means migration keeps coming, from interstate and overseas. There is a shortage of bricks. There are labour costs and government charges on new builds.
Every one of those makes the supply problem worse, not better.
My view is that rents go up from here. I feel for the tenants in that, genuinely. But if you already own a rental property, the case for holding it looks stronger to me now than it did before the budget, not weaker.
That is my opinion about the market, not a forecast anyone can guarantee, and it is not advice about your tax position.
If you are selling anyway, the tenant matters more than the tax
This is the part almost nobody thinks about, and it costs more money than the tax change will.
I sold a home in the Kelmscott hills where the tenant was marvellous. A fly in fly out worker with three young children, and he kept the place like an owner.
He worked around our home opens, had it presented beautifully, and we got a very good price. Those owners were selling to move money into their super before retirement, not because of the budget.
In my experience, that is maybe one in four tenancies. If that. The others go the other way.
Tenants with belongings everywhere who do not want their things photographed. Tenants who agree to a one o’clock home open and tell you at five to one that they have changed their mind, so you stand at the front gate turning buyers away. Tenants who sit in the lounge with the family and the pets while you try to run an inspection. Tenants who will not clean.
Some of it is deliberate. If they do not want to move, making the place look bad is the simplest way to stop it selling.
In my experience, selling into that situation can cost you a large share of what the property is worth. Far more than the difference in tax.
I have one at the moment where the tenant is lovely, but the house is full of boxes and you can barely move, and the gardens are well overgrown. The right answer there is to wait until the tenancy ends.
So my advice on a difficult tenancy is usually the same. Do not sell with the tenant in place. Wait for the lease to end, get the place empty, and spend a little on paint, floor coverings and the garden before you go to market.
The short version
If you already own it, you are probably better off holding it. Check that with your accountant.
If you are selling anyway, the state of the tenancy will affect your result more than the tax changes will.
And if someone tells you there is a simple answer that applies to everyone, they have not looked at your situation.
Selling an investment property in the Perth Hills or Foothills?
I will tell you what I think it is worth, whether I would sell it tenanted or empty, and what I would spend before going to market. Including when I think you should not sell at all.
Book a free Perth Hills and Foothills property appraisal
Truth. Strategy. Sold.
This article is general information, not tax or financial advice. Speak to your accountant about your own circumstances.