New Reserve Bank research has laid bare a profound shift in Australian property investment that the federal government is now using to justify the most sweeping housing tax changes in a generation.
The RBA's May 2026 Bulletin, drawing on new micro-level data covering the full population of tax-complying housing investors in Australia, found the median age has climbed from 45 to 51 since the 50% capital gains tax discount was introduced in 1999.
The over-60 cohort has more than doubled its share — from 12% to 28% — while investors under 30 have nearly disappeared. Their share fell from 9% to just 3%, and for 30 to 39-year-olds, from 26% to 18%.
The shift reflects both population ageing and a growing tendency for older cohorts to hold investment properties — with around 40% of the change attributed to broader demographic trends.
The wealth concentration is equally stark. The highest income quintile now accounts for nearly 40% of all housing investors in Australia.
"Higher income investors have greater borrowing capacity and have benefited more from tax concessions such as negative gearing and capital gain discounts," the bulletin found — while rising entry costs have progressively squeezed lower and middle-income households out of the market.
It is precisely this concentration of tax-advantaged wealth that the government says justifies its intervention.
On the same day the RBA bulletin was published, Treasurer Jim Chalmers introduced legislation to replace the 50% CGT discount with cost-base indexation and a 30% minimum tax on net capital gains from July 2027. Negative gearing on established properties purchased after budget night will be restricted to new builds from that date, with existing investors grandfathered.
Chalmers said, "This is the first step in the most ambitious tax reform package for a quarter of a century."
Around 80% of investors remain leveraged.
"The share of negatively geared investors is likely to have increased further over recent years," the bulletin noted, with younger investors who entered the market more recently disproportionately reliant on the concession given their lower rental yields relative to purchase prices.
Westpac is forecasting that the combined effect of the tax changes and the RBA's three rate rises this year will push Sydney and Melbourne prices lower — potentially triggering a reassessment among some investor clients.
The price outlook and the debt picture are connected risks. Around one-third of investors carry mortgages on both their investment property and primary residence — and households with that dual debt load are more indebted relative to their income than those carrying investment property debt alone. These borrowers account for around 70% of investor households with debt-to-income ratios above 6 — the threshold APRA considers higher risk.
The RBA concluded the sector remains broadly resilient but flagged a structural vulnerability: "This reliance on capital gains alongside negative cash flows may make investors more likely to sell during a downturn or when expectations of future price growth are reassessed."
For more information, read the RBA bulletin.
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