Aggregator says upcoming negative gearing and CGT changes demand a proactive response from brokers
Mortgage brokers should take an active role in guiding clients through the upcoming federal Budget changes to negative gearing and capital gains tax (CGT), according to aggregator Finsure.
Simon Bednar (pictured top), chief executive of Finsure, said the budget had not simplified the market, but had reinforced the need for brokers to take the initiative rather than wait for client enquiries.
"The role of a broker has never been more important," he stressed. "There are clear opportunities in first-home buyer activity, new-build lending, regional housing, small business finance and serviceability support. But major tax changes could also alter investor appetite, client behaviour and the way brokers discuss long-term property decisions."
From 1 July 2027, negative gearing will be restricted to new builds. Properties held before budget night will remain under existing arrangements. Investors purchasing established housing after budget night will still be able to deduct losses against residential property income and carry forward unused losses, but will not be able to offset them against other income such as wages.
The government will also replace the current 50% CGT discount with an inflation-based discount and introduce a minimum 30% tax on gains from 1 July 2027. The changes will apply only to gains arising after that date. New-build investors will have the option of either the existing 50% CGT discount or the new arrangements.
Bednar said first-home buyers were likely to remain a key segment, particularly if investor activity declines following the tax changes.
"Brokers should be tailoring their marketing, education and client engagement toward buyers who need guidance through deposits, grants, schemes, serviceability and lender selection," he added.
"Investor clients will need more strategic conversations. The shift in negative gearing and CGT treatment means brokers should not give tax advice, but they should be encouraging clients to seek advice early and consider how future settings may affect borrowing, refinancing, buying, selling or holding decisions."
Bednar pointed out that new builds would become more important, and that brokers who understood construction lending, progress payments, land registration, valuation risk, builder due diligence and new-build investor policy would be better placed to capture demand.
He also said regional opportunities should not be ignored. "Government-backed infrastructure investment can create new lending corridors, but brokers need to understand those communities and build referral networks before demand peaks," Bednar pointed out.
"Serviceability will also remain the battleground. In a cost-of-living environment, brokers who can help clients understand spending, reduce unnecessary debt and prepare properly before an application will be in a stronger position."
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