Navigating the New Landscape: What the Federal Budget Means for Eastern Suburbs Property

Insights from Elliott Placks, Managing Director & Principal, Ray White Double Bay

Changes in policy always bring about new levels of uncertainty across the market. However, changes also make way for new opportunities; particularly for those who act strategically and not reactively. 

Last week’s federal budget introduced major changes to Negative Gearing benefits and Capital Gains Tax (CGT), which have prompted questions from investors, first home buyers, and renters alike. In a recent interview, Elliott Placks, Managing Director and Principal of Ray White Double Bay, shared his perspective on what these changes mean for the Eastern Suburbs Property Market. 

Ray White Double Bay Business Holds Strong

What makes this conversation particularly interesting for our market is that approximately 80% of properties sold through Ray White Double Bay transact to owner-occupiers. Since the CGT exemption remains intact for an individual’s principal place of residence, the family home has now positioned itself as an owner’s greatest asset. Therefore, it is likely we will see those with the capacity to invest further into their primary residence, doing so, in order to better leverage it in the market. 

For Existing Investors: Don’t Panic

The reforms include a grandfathered approach to negative gearing on existing investments; meaning current investors retain their full 50% capital gains deduction in perpetuity on their properties until sold. Additionally, investors who purchased after 7:30pm (AEST) on 12 May 2026 will retain the 50% CGT deduction until the end of the transitional period on July 1 2027, with cost-base indexation for assets to follow. Therefore, there is no reason to rush to sell. 

Since the Eastern Suburbs has consistently delivered around 10% annual capital growth over the past three decades – and there are no other assets that allow for the same leverage – property remains one of the most powerful wealth building tools. 

Changes To The Rental Landscape Will Be Felt

Following this budget, an upward pressure on rents is anticipated. Fewer new investors may be seen entering the market in the short term, thereby tightening current supply further – a dynamic that ultimately benefits those already holding investment properties. With vacancy rates sitting between 1–2% in the Eastern Suburbs, and sustained demand from both domestic renters and migrants, quality rental stock remains well-positioned. 

Looking at Young Buyers

Whilst the budget’s measures may temper broader investment activity, they don’t meaningfully address the core issue: supply and accessibility. Elliott’s appeal to younger Australians looking to get their start in the property market is to simply start somewhere. Whether that be disciplined savings or smaller investments, to build enough leverage to enter the property market as soon as it’s feasible, even if the first step is outside your preferred suburb. With strong rental yields continuing to hold and long-run capital growth remaining intact, the cost of waiting typically outweighs the cost of getting in. Young Buyers should rest assured that property is always a valuable investment.

Final Advice: Stay Focussed on the Controllables

Policy and the market will always shift. What we can control is how we position ourselves within the conditions that exist. As Elliott stated, Australia remains a remarkable place to invest – there is strong growth, unparalleled lifestyle, and consistent demand across the Eastern Suburbs, offering boundless opportunities. 

To discuss how the current market conditions and policy changes affect your specific situation, reach out to the team at Ray White Double Bay.