After Australia's tax reforms, what do local Australians most need to watch out for when investing in established homes?

Many clients have recently been asking us: "After these Australian tax reforms, will buying an established property be affected?"

First of all, these tax reforms only affect established properties. Since overseas buyers can only purchase new properties — including overseas individuals holding a temporary Australian visa buying a home to live in, who also cannot buy established properties — there is no impact on them. So the reforms only concern established properties purchased by Australian citizens and Australian PR holders.

Today, here's the conclusion in simple terms:
For established property investment, the most important change is that the way Capital Gains Tax is calculated may undergo a significant shift.

Key points of the new system:

From 1 July 2027, the 50% Capital Gains Tax discount currently available for assets held over one year may change to:

Cost base adjusted for inflation (Indexation) + a minimum 30% Capital Gains Tax rate

So what scenarios might arise for established properties?

[Scenario 1]
Sale completed before 1/7/2027
→ Still calculated under the old system

[Scenario 2]
Asset purchased only after 1/7/2027
→ Entirely under the new system

[Scenario 3 (the one most people care about)]
Bought before 2027 but sold only after 2027

In this case, a "split calculation" will apply:

▪ Capital gains accrued before 1/7/2027
→ Old system applies

▪ Capital gains accrued after 1/7/2027
→ New system applies

In other words:

1 July 2027 may become a very important "valuation baseline date".

So the question is: "Should you get a valuation done or not?"

There are two main approaches:

① Obtain a professional valuation report
② Use the apportionment formula provided by the ATO

So which is better?

To put it simply:

If most of the property's growth occurred in the earlier period
→ Getting a valuation is usually more favourable

If the strong growth only began later
→ Using the apportionment formula may be more advantageous

[My advice]
 Around 1/7/2027, whether it's your own home or an investment property, we recommend keeping valuation records

Because:
A home you live in today may well become an investment property in the future
With valuation records on hand, you'll usually have more room for tax planning when you eventually sell.
Many people right now are focused on "where to buy"
(The above is provided for general information purposes only; for your actual tax arrangements, please confirm with a professional accountant or tax adviser.)