Who wins, who loses? What does the Federal Budget mean for property?

So Hope, let's start at the very top.

In plain English, what does this year's federal budget actually mean for the property market?

Well, at its core, this budget is really trying to change who property investing works for.

The first major change that we have, of course, is the removal of negative gearing.

So you can't take advantage of that on residential properties that were bought before budget nights.

That is the 12th of May.

However, there is an exemption for new builds.

The other thing that we are working with is the removal of the 50%.

CGT discount.

So that is set to be replaced with an inflation-based indexation model and a minimum 30% tax rate.

And that's going to happen from July next year.

It's important to note though, that for existing investors, they're going to be largely protected through what we call grandfathering.

But if you are a newer investor or a prospective investor, this is really going to change the landscape that you had been expecting before now.

So then would you say that this is kind of the government's pitch to, I guess, even out and level that playing field for everyone?

Absolutely.

So this government is really, really keen to take a stand on what they are labelling intergenerational unfairness.

So the Treasury says that property prices are up more than 400% since 1999 and And of course, we know that wages, incomes have just not kept up with that.

So the idea, I guess, behind these changes is to tilt that balance away from investors competing with first home buyers and just continuing to boost the focus on new home building instead, which of course is really critical to just addressing existing price pressures that are already in the market.

And this budget certainly didn't land in a vacuum.