Following recent Federal Budget changes, the flow-on effect to the housing market has caused investors to look more closely at brand new properties.
First-home buyers and upgraders may be considered the main buyers of brand-new builds, but 2026 budget night could be changing that, with tax settings that make them more appealing to investors than in years past.
“The Federal Budget changes have created a much clearer distinction between investing in a new home and purchasing an established property,” says Daniel Hubbard, Group Manager, Invest by Metricon.
While this is potentially good news for investors, there is still a degree of confusion about exactly what is changing and the trade-offs to weigh up.
“The strongest investment decisions will still be driven by the fundamentals: buying the right type of home, in the right location, at a sustainable price and taking a genuinely long-term view,” he says.
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Changes from the 2026 Federal Budget are making new builds a more appealing choice for investors.
Key tax changes driving new-home appeal
New tax rules for investors were the big reveal of budget night in May 2026, which Angus Moore, REA Group senior economist, says could shift investor demand towards new builds.
Under the changes, negative gearing has been abolished on existing investment properties bought after budget night, while the 50% CGT discount for properties owned for more than one year has been slashed and will revert to a pre-1999 indexation model.
But new builds were given a carve out from these alterations.
“New builds are the only asset investors can buy that can still use the typically more generous 50% capital gains discount, instead of the new inflation indexation approach,” Mr Moore explains.
“Newly built homes are also exempt from the changes to negative gearing for residential rental properties.”
Mr Hubbard adds that a new build will also give an investor access to depreciation and capital works deductions.
“This places new housing in a distinctly stronger position within the investment landscape, although investors should always seek independent tax and financial advice based on their circumstances,” he says.
New homes can still offer investors access to capital gains discounts and negative gearing under the new tax reforms.
Low maintenance and peace of mind
While tax changes may turn investor attention to new homes, Mr Hubbard says this is just one factor in the appeal.
The fact they are low maintenance, and everything is brand new and under warranty, makes being a landlord easier.
“New homes also come with applicable statutory warranties and builder protections, which vary by state and territory,” he says.
“For an investor, that can provide valuable reassurance and make costs easier to anticipate.”
Mr Hubbard points out that for many investors, helping to solve the problem of Australia’s housing shortage adds a positive incentive.
“Population growth, household formation and an undersupply of suitable housing are sustaining demand in many markets,” he says.
“For investors, the opportunity is not simply to compete for existing stock, but to help create the additional homes renters need.”
With lower maintenance than established homes, new homes can help investors navigate costs easier.
Design, lifestyle and rental appeal
For tenants, signing a lease on a brand-new home means having access to the latest in modern design, floorplans, indoor-outdoor living, stylish kitchens and bathrooms, climate control and more.
“Renters increasingly expect the same qualities from a home that an owner-occupier would: comfort, functionality, storage, energy efficiency and spaces that support contemporary life,” says Mr Hubbard.
New homes often appear in emerging communities in key growth corridors, for example, western Brisbane in South East Queensland and west of Melbourne in Victoria. These can attract tenants due to their location and amenity.
“Renters are looking for connectivity, convenience and quality of life, so proximity to transport, employment, schools, childcare, retail, parks and community facilities can be highly influential,” he says.
Tenants also see the appeal of newly built homes, like modern floorplans and access to new communities.
Home designs for different investment pathways
Investors taking the new-build path can select a design for a variety of potential tenants, whether that be singles, couples, families or multi-generation families.
“Single-storey homes offer broad family appeal, while double-storey designs maximise living space on smaller blocks. Town homes can attract tenants seeking a low-maintenance lifestyle close to transport and amenity, while house and land packages provide options tailored to growing communities,” says Mr Hubbard.
For investors wanting to make the most of their existing location, a dual-occupancy or duplex design could be the solution.
“There is no single investment design that suits every buyer. The right choice depends on the land, location, budget, target tenant and long-term strategy,” he says.
Metricon can help investors make smarter building decisions. Experts are on hand to work through key aspects including the location, land, design, budget and the type of tenant the property is intended to attract.
“The focus is on helping investors select a practical, market-appropriate home rather than overcapitalising on features that may not improve rental appeal or long-term performance,” he says.
