- New builds keep negative gearing under the 2026 tax changes.
- Brand-new homes give the largest depreciation deductions.
- Ready to lease at handover, with nothing left to fit out.
How the rules work
- Negative gearing
- If the property costs more to hold than it earns in rent, the loss can reduce your other taxable income. From 1 July 2027 this is limited to new builds, plus properties bought before 7:30pm on 12 May 2026.
- Capital gains
- Investors in new builds can choose the 50% discount or the new indexation method when they sell. Established purchases move to the new method for gains after 1 July 2027.
- Depreciation
- A new home lets you claim the building itself (usually 2.5% of construction cost a year) and its fittings such as the oven, carpet and blinds. You need a quantity surveyor's schedule. It is a tax deduction, not cash in your pocket.
- Costs during construction
- Interest and holding costs while the land is vacant and the home is being built are generally not deductible until the home is finished and available to rent. They may form part of the cost base instead.
- Land tax (Victoria)
- Charged each year on the site value of Victorian land you own on 31 December, excluding your own home. If this is your only Victorian investment, it is assessed on this lot alone.
- Stamp duty
- Paid on the land contract only, not on the building contract. On a $300,000 lot that is about $13,070 at general rates.
- Gross yield
- A year's rent divided by the purchase price. A quick comparison, not your actual return. Every package shows its estimate.
