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Budget 2026/27

What it means for brokers.

Are brokers better off from the budget?

By Simon Bednar, Finsure Group CEO

The Federal Government handed down its 2026–27 budget last night, and for mortgage brokers the answer is not simply whether the industry is “better off” or “worse off”.

There are clear opportunities in first-home buyer activity, new-build lending, local 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.

Here’s what you need to know.

Investor lending has changed, but it has not disappeared

The most significant housing-related change is the reform of negative gearing and capital gains tax.

From 1 July 2027, negative gearing will be limited to new builds. Existing arrangements will remain unchanged for properties held before budget night, while investors buying established housing after budget night will still be able to deduct losses against residential property income and carry forward unused losses, but not deduct them against other income such as wages.

The Government will also replace the current 50 per cent CGT discount with an inflation-based discount and introduce a minimum 30 per cent tax on gains from 1 July 2027. The reforms will apply only to gains arising after that date, while new-build investors will be able to choose either the 50 per cent CGT discount or the new arrangements.

For brokers, the practical question is how this changes investor behaviour, loan demand and housing turnover.

The immediate impact is likely to be softer investor demand for established dwellings, rather than a fall in all mortgage activity. Investors who relied heavily on tax deductibility may step back, while better-capitalised, yield-focused and lower-LVR investors are likely to remain active.

The bigger opportunity may be in new housing. By preserving negative gearing for new builds and giving new-build investors more CGT flexibility, the Government is trying to redirect investment into supply. Brokers should expect more questions about house-and-land packages, newly completed apartments, construction lending, valuation risk, sunset clauses and settlement timelines.

Brokers should not provide tax advice, but they can add value by encouraging investor clients to speak with accountants, stress-test holding costs and assess whether a new-build strategy suits their cash flow and long-term goals.

A window of activity before 1 July 2027

The transition period matters. The negative gearing and CGT changes have a grace period, with changes applying to assets acquired from budget night but taking effect from 1 July 2027.

Some investors may review whether to buy, sell, refinance or restructure before the new rules begin. Others may hold existing assets because their current negative gearing treatment is preserved. For brokers, this could create opportunities in investor refinances, equity releases, bridging finance, debt consolidation, portfolio reviews and owner-occupier replacement purchases.

First-home buyers may get a clearer run

The Government says the reforms are expected to support an additional 75,000 new homeowners over the decade.

If investor demand eases in parts of the established market, but shift to first home buyers, the opportunity is now in education, not just more applications. First-home buyers need help understanding borrowing capacity, deposit pathways, guarantor options, grants and schemes, lender policy differences, genuine savings, HECS/HELP impacts and the trade-offs between established homes and new builds.

$2 billion local injection

One of the key housing supply announcements was the new $2 billion Local Infrastructure Fund, designed to help local governments and state utilities build essential infrastructure such as water, power, sewerage and roads.

The Government says this will support up to 65,000 new homes over the decade.

For brokers, regional and growth-corridor opportunities should not be ignored. Where new housing supply is being unlocked, brokers should build relationships with local councils, developers, accountants, real estate agents and community organisations, and position themselves early as part of the local housing ecosystem.

Cost-of-living relief helps, but serviceability remains key

The Government has announced a permanent Working Australians Tax Offset of up to $250 from 2027–28, and a $1,000 instant tax deduction will also apply from 2026–27, allowing workers to reduce taxable income from work by $1,000 without keeping receipts.

Around 6.2 million workers are expected to benefit, with an average tax saving of $205.

These measures will help, but clients are still dealing with mortgage repayments, rent, groceries, insurance, energy bills and living costs. For brokers, serviceability remains front and centre.

Small business clients also need attention

The Government will permanently extend the $20,000 instant asset write-off from 1 July 2026 for small businesses with turnover up to $10 million. It estimates this will improve small business cash flow by around $890 million over five years.

The budget also reintroduces loss carry-back rules from 2026–27, allowing eligible companies that make a current-year loss to seek a refund against tax paid in the previous two income years.

This could support demand for equipment finance, asset finance and business lending, as business owners gain more certainty to upgrade vehicles, machinery, technology and other productivity-enhancing equipment.

For brokers, it is an opportunity to deepen relationships with self-employed clients, work more closely with accountants and identify where business finance can complement residential lending advice.

What this means for mortgage brokers

Overall, this budget has not made the market easier, but reinforces the importance of being proactive, not reactive. The role of a broker has never been more important.

  1. First-home buyers are likely to remain a key market, particularly if investor demand shifts and housing initiatives continue to shape buyer behaviour. Brokers should be tailoring their marketing, education and client engagement toward buyers who need guidance through deposits, grants, schemes, serviceability and lender selection.
  2. 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.
  3. New builds will become more important. Brokers who understand construction lending, progress payments, land registration, valuation risk, builder due diligence and new-build investor policy will be better placed to capture demand.
  4. 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.
  5. 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.

If you are unsure how best to capitalise on these opportunities, speak to your business development manager. We have the team to help you adapt and grow your business.