From the archive: a reader question Noel Whittaker answered in his July 2026 newsletter that deserves a wider audience.
A reader wrote in with a situation plenty of people in their forties and fifties will recognise. He'd bought a unit off the plan, moved in when construction finished in 2023, and lived there ever since. Now he was thinking about moving out and renting it instead — and he wanted to know what the Budget's proposed capital gains tax (CGT) changes would mean for him.
The answer had two parts, and both are worth knowing.
First, the negative gearing restrictions announced in the Budget apply only to properties bought after Budget night, 12 May 2026. A property you already owned before that date isn't caught by them. Once it becomes a rental, the usual deductions — including the interest on the mortgage — should still be available against your taxable income.
Second, and this is the part most people have never heard of: because the unit had been his principal place of residence, the six-year absence rule was open to him. That rule lets you move out, rent your former home, and still treat it as your main residence for CGT purposes for up to six years — provided you don't nominate another property as your main residence during that time.
Put the two together and the picture changes.
For the next six years, you could own an asset that is not only eligible for negative gearing benefits but may also be sold free of capital gains tax.
It isn't automatic, and the conditions genuinely matter — the property has to have been your principal residence first, and you can only nominate one main residence at a time. But if you're weighing up whether to sell the family home or hold onto it and rent it out for a few years, this is the rule to understand before you decide, not after.
Read the full article: Your questions answered — Noel News July 2026 — Noel Whittaker, Noel News, July 2026.
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