Mum and dad investors like Kacey and Lene Inu avoided stressing about federal budget changes by investing in newly-built homes, using tried and true methods to pay off their home mortgage.
The Everton Hills couple bought their first investment property in 2024, after struggling to repay their home loan while parenting four kids.
“We were just living and spending everything we made, living week to week,” Ms Inu said. “We had no structure whatsoever … and we were paying off the bare minimum.”
Lene and Kacey Inu became investors to pay off their home mortgage, using a plan that would sidestep any CGT and negative gearing changes. Pictures: Adam Head
With the help of financial firm Infinity, the family bought four investment properties within just two years: all of them homes still under construction, with one under the family’s self-managed super fund (SMSF).
Ms Inu said the decision was one of many big changes for the family, who started using a strict budget to keep costs down.
“Our budget has not changed in the last two years, and that’s what’s allowed us to buy these properties,” she said.
“Once you start sticking to a budget, you realise how much money you’re wasting when you’re not following a set plan. Even once we’re mortgage free, we won’t waste money again.”
Investing in newly-built property allows for landlords to continue negatively gearing their new homes, despite planned changes to the federal budget.
Exclusive research from PropTrack found homes in many Brisbane suburbs would be subject to massive price hikes under new changes to the Capital Gains Tax (CGT).
Areas where prices had outpaced inflation were found to be hit hardest. If a New Farm investor decided to sell their property after 35 years, they would end up paying a whopping $644,000 extra on their CGT under the new system.
New Farm homes such as this one would see big tax hikes under the new CGT system – but the Inu family’s self-managed super fund investment would not be affected by any new laws.
The changes are set to go into effect from July 2027. Since the Inu family’s properties are brand new, nearly all of the properties’ future equity will be hit by this higher payback rate.
But as the family would only be investing in newly-built homes, the properties could still be negatively geared: avoiding upcoming restrictions to negative gearing on existing properties.
Meanwhile, their home under a SMSF is subject to different laws left unchanged by the federal budget, allowing them to invest in their retirement without worrying about the CGT.
Ms Inu said their best property decision was speaking to professionals about the best way to manage their money before jumping into an investment. Pictures: Adam Head
Ms Inu said this meant her family was comfortable with their future in investing.
“It is an investment, and you invest to make money,” she said. “Where the properties make money, that’ll decide whether we’re selling, putting tenants in, or waiting to let equity go up.
“We wouldn’t have any idea on our own, which is why we have experts who know what they’re doing.”
New investors are being priced out of the market thanks to expected budget changes, while existing investors will see their homes grandfathered in with current property laws.
Infinity finance strategist Rachael Howlett said her team was largely unaffected by the federal budget announcement, but it was encouraging them to reconsider how they would sell newly-built homes in the future.
“What may change in the longer term with those strategies is, what do we do when we go to sell those properties?” she said.
“They do become established homes, which means when we pass them on to another investor, they’re going to think twice.”
Infinity finance strategist Rachael Howlett said the changes made them consider how to sell investment homes that were once new builds in the future.
Ms Howlett added new investors would struggle to enter the market as easily without today’s readily available incentives, and would need to do more research with the right financial planners.
“My advice to those younger investors would be, you’ve got to look into those numbers a lot more closely,” she said. “[Invest] in a way that’s still gonna fit your current circumstances.
“You’ve got to make sure you pick the right type of advice or adviser – they’re not all created equal.”
English (US) · 