Carrington Clarke

And it is going to be fascinating to see how this plays out.

So they have made substantial changes to negative gearing.

Negative gearing, you will only be able to access that if you're going for new builds.

So no longer can you use it when it comes to existing properties.

It's a huge deal.

And they point out that it's like 80%, 90% of the investment from investors is into existing properties.

At the moment, it's not going into new builds.

So they want to completely shift that mix and they want investors –

Investing in new builds, they say that will help to force up supply of property, which is what they want if you want is to have lower prices.

But that coupled with the significant changes to CGT, and again, without all this speculation, would they just reduce it a little bit?

Would there be a new number?

Well, it's kind of back to the future.

So the Howard Costello team changed the arrangement because it used to be just wanting to tax what they call the real increase.

So that's above inflation.

So previously, the calculation would be minus the inflation that

what's happening in the broader economy, and then you would just be taxed on the extra bit.

Now they're going back to that system.

So if you're investing over multiple years, they will subtract the inflationary aspect of that price increase, but then you will get taxed on the rest of the real increase.

And this is a fascinating change because the argument from the government is those two things working coupled.

The CGT discount and negative gearing meant that we have supercharged the return on existing property investment.