No.5 | The Changing Value of Home

The Invisible Layer Series No.5 | May 2026

A note from Jacqui

The recent discussion around negative gearing and capital gains tax has highlighted something interesting about the way property is being viewed in Australia.

For many people, the decision between purchasing an investment property versus improving a primary residence has, at some level, been influenced by tax incentives.

If the announced reforms proceed, spending on your own home may become comparatively more attractive over other opportunities.

Warm regards,
Jacqui

The Invisible Layer Series No.5

The Changing Value of Home

Investment properties have traditionally appealed to many buyers because of the tax advantages attached to them.

As a result, renovating older investment properties has often been driven by the thinking:

Will upgrading this property generate a strong enough return and advantage through resale value and tax offsets from negative gearing?

The way spending is prioritised within a home can influence both how it lives and how it holds value over time.

Under the announced reforms, established residential investment properties purchased after Budget night would no longer receive the same negative gearing incentives, while new builds would continue retaining them.

Not everyone has the appetite, borrowing capacity, capital allocation, or time required for a complete new build purely as an investment.

Which may start changing where renovation spending is allocated.

Because if the financial advantages attached to improving older investment properties reduce over time, improving your primary residence may become comparatively more attractive.

Not only because you are the one living inside the outcome, but because a primary residence has always carried both lifestyle value and capital gains tax advantages.

Your home increasingly becomes a strategic decision in itself, not purely through a lifestyle lens, but financially as well.

Which starts shifting the conversation away from:

“What delivers the best financial return?”

To:

“Where does spending create the best overall return?”