2026-27 Federal Budget Australia: Property & Business Impact

The 2026-27 Federal Budget Unpacked: What It Means for Home Buyers, Investors and Business Owners

The 2026-27 Federal Budget introduces some of the most significant proposed property and taxation reforms Australia has seen in years. Delivered by Treasurer Jim Chalmers on 12 May 2026, the Budget outlines the Government’s economic priorities through to mid-2027 and includes several measures that could reshape housing affordability, property investment and small business planning.

While many of the announcements are still proposed and subject to legislative approval, they provide a strong indication of the Government’s intended direction. Whether you’re a first home buyer, property investor, SMSF trustee or business owner, understanding these changes now could help you make better financial decisions in the years ahead

What the Federal Budget Means for First Home Buyers

First home buyers were a major focus of this year’s Budget, with several initiatives aimed at improving housing affordability and increasing supply.

The Government’s housing strategy centres around making it easier for Australians to enter the property market while reducing competition from investors and foreign buyers.

Key Housing Measures Announced

Providing $2 billion in infrastructure funding to support the construction of up to 65,000 homes by 2036.
Banning foreign investors from purchasing established homes until mid-2029.
Changing investor tax benefits such as negative gearing and Capital Gains Tax (CGT) concessions to help shift opportunities towards owner-occupiers.

According to the official Budget Overview:

“The Government is building on [Home Buying] efforts in this Budget by reforming negative gearing and capital gains tax concessions to help level the playing field for first home buyers and support more Australians to realise the dream of home ownership.” (Budget Overview 2026, p.24).[1]
The Government says these changes are designed to make home ownership more accessible for Australians. However, some of the proposed reforms could potentially place additional pressure on investors rather than directly solving broader housing supply challenges.
For first home buyers, these measures could potentially reduce competition in parts of the property market over time.

What the Federal Budget Means for Property Investors.

Property investors are likely to feel some of the biggest impacts from this year’s Budget.

Changes to Capital Gains Tax (CGT)

The Government plans to replace the current 50% CGT discount with a new indexation-based system from 2027.

Under the current rules, the maximum effective CGT rate for many investors is around 23.5%. Under the proposed changes, the minimum effective rate is expected to increase to around 30%.

This could reduce after-tax returns for investors when selling investment properties. Superannuation funds, including SMSF will be excluded from CGT changes, keeping property invested in via an SMSF unaffected.

These reforms will only apply to gains arising after 1 July 2027. Investors purchasing new builds will have a choice between the existing 50 per cent CGT discount or the new arrangements.

Changes to Negative Gearing

The Budget also announced proposed changes to negative gearing rules for established residential properties purchased after 12th May 2026.

From 1st July 2027:

Important Things to Know:

New-build investment properties will still be eligible for negative gearing benefits. Knock down rebuilds will not count as new builds unless it adds a unit to the development.
Existing investors who owned investment properties prior to 12th May 2026 will retain current arrangements under grandfathering provisions
Commercial property will remain exempt from the negative gearing changes.

These reforms could affect borrowing capacity, investment strategies and long-term returns for many Australians.

If you’re unsure how these changes may affect your financial position, now could be a good time to review your current strategy and explore your options.

What the Federal Budget Means for Business Owners

There was positive news in the Budget for many small business owners.

The Government confirmed that the $20,000 Instant Asset Write-Off will become a permanent measure for eligible businesses with an annual turnover under $10 million.[4]

What This Means

Eligible businesses can continue to immediately deduct the cost of qualifying business assets worth less than $20,000, including:

This could help businesses improve cash flow, invest in upgrades sooner and better plan for future growth.

With the end of the financial year approaching, business owners considering equipment or vehicle purchases may benefit from speaking with their broker early to understand their finance options and timing requirements.

Government Scheme Combinations for Perth FHB Suburbs in 2026

Every suburb in this guide is within Keystart’s $860K property cap and the FHBG’s $850K Perth cap. For new builds in suburbs under $800K (which includes all suburbs listed here), the WA FHOG of $10,000 is also accessible. Here is how the schemes combine for a typical purchase in these corridors:

Keystart + FHOG (new build, $600K): 2% deposit = $12,000. FHOG = $10,000 applied at frame stage. Stamp duty concession (first home buyer): potential saving up to $17,765 at $600K. Total schemes value: $27,765+ in cost reduction.
FHBG + FHOG (new build, $700K): 5% deposit = $35,000 (no LMI under FHBG, saving ~$15,000–$20,000). FHOG $10,000. Stamp duty concession: potential saving up to $15,390 at $700K. Total schemes value: $40,390+ in cost reduction.

How Strawberry Finance Helps Perth FHBs Find and Finance the Right Suburb

At Strawberry Finance, our Perth suburbs for first home buyers 2026 recommendations are backed by real lender policy analysis – not just suburb price data. Every buyer’s situation is different: some qualify for Keystart, others for the FHBG, others for guarantor arrangements. We identify the scheme combination that maximises your purchasing power, check scheme eligibility specifically for the property and suburb you are considering, and ensure your loan is structured to support future upgrades without compromising government scheme entitlements.

Based in Hillarys on the northern corridor, Strawberry Finance has deep familiarity with the northern FHB market – from Butler to Yanchep. We are also well-versed in the south-eastern corridor suburbs that offer Perth’s best affordability-growth balance in 2026. Call 0457 133 453 or visit strawberryfinance.com.au.

Final Takeaways from this Year’s Budget

This year’s Federal Budget introduces significant changes across the property and business landscape.

For first home buyers, the Government hopes these reforms will improve access to housing over time. For business owners, the permanent Instant Asset Write-Off may provide greater certainty and flexibility.

However, investors may need to carefully reassess their strategies, as changes to CGT and negative gearing could alter the long-term outlook for residential property investment.

Its worth remembering reforms are proposed only until passed, so there’s a chance things will change between now and then.

Whether you’re feeling cautious, optimistic or uncertain about the implications of the 2026-27 Federal Budget Australia, speaking with a finance professional can help you better understand your options. Whether you’re looking to buy your first home, invest in property, expand your portfolio, or grow your business, Strawberry Finance can help you navigate a changing lending landscape and identify financial solutions tailored to your goals and circumstances.

Note: This article is intended to provide general information only. It does not take into account the financial situation, objectives, or needs of any individual reader and must not be relied upon as financial product or credit advice. While every effort has been made to ensure the accuracy of the information provided, some details may change over time or may not always reflect the most current market conditions. Readers should consider seeking independent financial or professional advice before making any financial decisions based on this information.

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