ATO data reveals where negative gearing reforms will hurt most

Agent Tina O’Connor said the uncertainty of recent government reforms had reduced investor demand. Picture: Jeremy Piper Western Sydney tenants have been warned to brace for one of the largest rental price shocks in the country when planned negative gearing changes take effect next year. Analysis of tax office data has revealed the landmark reforms in this year’s May federal budget could make property investment in outer Sydney untenable, with a crippling impact for tenants. The negative gearing claims data from the ATO for the 2023/24 financial year, the latest with suburb-by-suburb data, showed investors in outer areas were the heaviest users of the tax benefit. Investors in these areas reported the greatest volume of losses on their properties, with the average landlord who made a claim owning just a single property. Areas like The Ponds and Schofields in Western Sydney had the highest concentration of negatively geared landlords in the city, claiming typical annual losses on their investments of about $9000-$10,000. More than half of the investors across the entire country (54 per cent) were negatively geared that financial year, a rise from about 40 per cent during the Covid y...