The Elephant in the Room
The property podcast for the thinking person.

Episodes

Episode 437: Negative Gearing Is Changing: What Happens Next?

With the federal government proposing major negative gearing changes in Australia alongside reforms to capital gains tax property rules in Australia, the conversation around property investing is shifting rapidly—and so are the risks.

In this episode, Veronica and Chris unpack how negative gearing changes could affect investors, property values, borrowing capacity, and long-term wealth creation. While the policy is being positioned as a solution to housing affordability in Australia and a pathway for more first-home buyers to enter the market, they explore whether the real-world consequences may be far more complicated than the headlines suggest. The discussion goes beyond a simple “negative gearing explained” conversation and examines how changing investor incentives could reshape the broader Australian housing market for years to come.

A major focus of the episode is what happens if negative gearing is removed from established residential property. Veronica and Chris examine why investor-driven markets — particularly regional areas and apartment-heavy precincts — could face the most pressure if investor demand slows. They also explore a growing concern around new-build resale markets: if tax incentives only apply to brand-new properties, what happens when those properties are resold?

The conversation also unpacks how these tax changes could affect property investors beyond tax deductions alone. From borrowing capacity and buyer demand to SMSF investing and off-the-plan property, Veronica and Chris explain why many Australians may need to rethink their property investment strategy in Australia. They also discuss whether reduced investor activity could worsen the rental crisis in Australia while housing demand remains strong.

The episode further explores whether property prices will fall in Australia if investor behaviour changes significantly, and why asset quality, scarcity, and owner-occupier appeal may become even more important moving forward. Whether you’re an investor, first-home buyer, or wondering if property is still a good investment in Australia, this conversation examines the risks and market shifts that could shape the future of the Australian housing market.

Episode Highlights

01:57 – The Negative Gearing Changes Explained

04:19 – Why Chris Says “Everything Gets Repriced”

06:37 – Who Wins From the Grandfathering Rules?

10:40 – The Borrowing Capacity Squeeze Ahead

12:21 – Which Regional Markets Are Most at Risk?

17:39 – The Mining Boom Mistakes Repeating Again

21:22 – Property Changes Meet Economic Headwinds

26:04 – Could Investor Sell-Offs Accelerate?

28:02 – Why Negative Gearing Created Scarcity

32:04 – Could Investors Need Another Bailout?

33:27 – The Owner-Occupier Data Nobody Sees

37:41 – Rental Demand, Bonds & Market Pressure

38:56 – Will First Home Buyers Finally Benefit?

41:35 – Why Australians May Need New Wealth Strategies

44:22 – Which Property Segments Get Hit Hardest?

46:17 – The Tax Structure Problem Few Discuss

48:04 – How the Property Industry Will Pivot Next

50:37 – Final Warnings for Buyers and Investors

Mention

About the Guests

Veronica Morgan is one of Australia’s most respected property experts, with decades of experience spanning property investment, buyer advocacy, market analysis, and consumer education. As the co-host of The Elephant in the Room and co-founder of Homebuyer Academy, Veronica is known for her evidence-based approach to property investing and her ability to cut through industry hype with clear, strategic insights. Having worked through multiple property cycles, she specialises in helping buyers understand the long-term drivers of capital growth, asset selection, and risk management in an increasingly complex housing market.

Chris Bates is the founder and CEO of Alcove, an award-winning mortgage broking and property advisory firm that helps Australians make smarter financial and property decisions. With deep expertise in lending strategy, borrowing capacity, debt structuring, and cash flow management, Chris works closely with first-home buyers, owner-occupiers, and investors navigating changing market conditions. He is widely recognised for his analytical approach to property and finance, as well as his willingness to challenge conventional wisdom and hype-driven investment narratives.

Resources:

Visit our website: https://www.theelephantintheroom.com.au

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Chris Bates