Whether to sell an investment property comes down to four things: whether it's paying its way, what your local market is doing, what's changing in your life, and when the tax would fall.

If the 2026 Budget has you wondering whether to sell before 1 July 2027, that date isn't a deadline. On a property you already own, the capital gain up to 1 July 2027 keeps today's tax treatment whenever you sell. Only growth after that date is taxed the new way, as the example below shows.

A rental you owned, or had signed a contract to buy, when the Budget was announced (12 May 2026) also keeps negative gearing until you sell it or change who owns it.

This guide is for people who own a rental in their own name. The decision is yours, and a tax agent or financial adviser can run the numbers for your situation.

Should I sell my investment property or keep it?

These questions help here. Your answers won't make the decision for you, but they show which way the numbers lean.

If you'd use the money to buy another rental, add one more question: what the switch costs. Since the 2026 Budget, that includes the tax treatment of the property you'd buy (see selling one rental to buy another, below).

Is the property paying its way?

A rental is paying its way when the rent, plus the growth you can reasonably expect, covers what it costs you to hold.

Gross rental yield (a year's rent as a share of the property's value) is the figure you'll see quoted most. It leaves out interest, council rates, insurance and repairs, so your own sums matter more.

Negative gearing. If the rental runs at a loss, you can currently use that loss to reduce the tax on your other income, such as your wages. A rental you held when the Budget was announced keeps this treatment until you sell it or change who owns it. Some transfers after a death or a separation keep it too.

Deductions stop once it's off the rental market. You can claim interest and other holding costs only while the property is rented, or available for rent on commercial terms. To judge that, the ATO looks at whether it's advertised widely at a rent in line with similar properties, and whether enquiries are followed up.

If it sits empty while you sell, those costs generally stop being deductible. In some cases they can go into the cost base instead (the amount your capital gain is measured from).

We explain how that works in our guide to what you can claim when selling an investment property.

How long owners hold. Cotality's resale data for the June quarter 2026 found that houses resold at a profit had typically been held for 9.3 years, against 4.4 years for houses resold at a loss. The profit and loss are before costs and inflation, and the figures cover all owners, not only investors.

These figures don't mean that holding for any set period guarantees a profit.

Is now a good time to sell?

It depends on where your property is, because values can rise in one city or region while they fall in another. The most useful evidence is what similar properties near yours have sold for recently, how long they took, and how far their price came down.

For the national market right now and what's moving it, see our guide on whether to sell your house now or wait. Nobody can tell you where prices go next.

When the appraisals come in, our guide on how to compare property appraisals shows what to look for in each agent's figures.

Is there a best time of year to sell?

No season suits every seller. More homes are listed in spring, particularly in the southern states: over the past five years, new listings rose almost 25 per cent nationally between late August and mid-November, according to Cotality.

That gives buyers more to choose from, so your property has more competition. For a rental, the lease often matters more than the month, because a tenant on a fixed-term lease can stay until it ends. For the seasons city by city, see our guide to the best time to sell a house.

Does selling before 1 July 2027 save tax?

Not on the gain up to that date. For a property you already own, that part keeps today's treatment whenever you sell. That includes the 50 per cent capital gains tax (CGT) discount, which halves the taxable gain for those who qualify.

To qualify, you need to have owned it for at least 12 months and be an Australian resident. The discount can be reduced if you were a foreign resident for part of that time. If you still own it on 1 July 2027, the new rules apply only to the growth after that date.

The contract date decides. For CGT, a property is sold on the day you sign the contract, not at settlement (the day ownership passes to the buyer). So a contract signed before 1 July 2027 falls under today's rules, even if settlement is later. If your dates are close, check the timing with your tax agent.

The minimum tax is a top-up that brings the income tax on the part of the gain made after 1 July 2027 to at least 30 per cent, even in a year when your other income is low. It doesn't apply if you receive certain payments at any time that year, such as the Age Pension or JobSeeker.

An example. Say a rental cost $500,000, is worth $800,000 just before 1 July 2027, and sells in 2029 for $850,000. The first $300,000 of gain is halved either way, so selling in June 2027 wouldn't have reduced the taxable amount of that part.

Only the $50,000 of growth since 1 July 2027 falls under the new rules. If inflation from 1 July 2027 to the sale came to 5 per cent, the $800,000 would become $840,000. That leaves $10,000 to be taxed in full, against $25,000 under a 50 per cent discount.

In this example, the new rules tax less of the later growth, because the property grew only a little faster than inflation. Whether they cost you more or less depends on how fast your property grows compared with inflation.

The example assumes a sole owner who stays an Australian resident and has owned the property for at least 12 months by June 2027. It also assumes an established property, inflation of exactly 5 per cent, no buying, selling or improvement costs, and no capital or rental losses.

It compares the taxable amount, not the tax, which depends on your income in the year you sell.

There is one practical difference. If you sell before 1 July 2027, you won't need the property's value at that date.

If you sell later, you'll generally need its value at 1 July 2027, unless you use another method the government is still developing. The ATO says it will publish guidance before the start date.

Our guide to tax on selling an investment property explains the new rules in full.

Selling one rental to buy another

Your current rental keeps negative gearing until you sell it or change who owns it, but that doesn't extend to the one you buy next.

For most established homes bought after the Budget announcement, an overall rental loss can't reduce your other income, such as your wages, from 1 July 2027. The loss is carried forward instead, to use against later rental income or capital gains from residential property.

New builds aren't affected by this limit, although the law's exact definition of a new build hasn't been settled yet.

Add selling costs on one property and stamp duty on the next, and the switch has to earn back more than it used to.

Which financial year will the sale fall in?

Your net capital gain (after any losses and the discount) is added to your income for the financial year you sign the contract. So a year when your other income is low means less tax on it. From 2027-28, the minimum tax reduces that benefit for the part of a gain made after 1 July 2027.

Which life changes affect the decision?

Separation, retirement and a death in the family can each change the tax or the timing of a sale.

Separation or divorce. If the property is transferred from one partner to the other under a court order or a binding financial agreement, CGT is deferred until the partner who receives it sells. If you sell to a buyer and split the money, the sale is taxed in the usual way.

The steps are in our guide to selling a property after a separation.

Retirement. A lower-income year can mean less tax on the gain. For growth after 1 July 2027, the minimum tax limits this, unless you receive the Age Pension or another listed payment that year.

If you're on the Age Pension, the rental counts in the assets test, and its rent in the income test.

Once you've sold, Services Australia assumes the money you keep in financial assets, such as bank accounts, term deposits or shares, earns a set rate, called deeming. From 20 September 2026, the rates are 1.75 per cent and 3.75 per cent. For a single person, the lower rate applies to the first $66,800 and the higher rate above that.

Our guide to selling an investment property after retirement goes into more detail, and our guide on selling an investment property to put into super explains the contribution limits.

A death in the family. An inherited home can be free of CGT if it was the person's main residence just before they died, it wasn't being used to earn income then, and the sale settles within two years of the death.

There are other conditions, and other ways to qualify, so check them with a tax agent before you set a sale date.

Our guide covers capital gains tax on an inherited home, along with the exemptions for a former home.

Should you sell a holiday home?

It's the same decision as for a rental, with one thing the ATO clarified in 2026: if it isn't mainly used or held to earn rent, you generally can't claim its ownership costs. That's from an ATO ruling issued in May 2026.

The ruling covers ownership costs such as interest, council rates, insurance and repairs, and applies even for the weeks the home is rented. You can still claim the costs of renting it out, such as advertising and booking fees, against the rent.

For ownership costs from before 1 July 2026, the ATO has said it won't use its compliance resources to check whether the ruling's view applies, unless there's evidence of avoidance, fraud or evasion. But if you ask it to amend a return or give you a ruling, it will still apply that view.

If yours isn't mainly used or held to earn rent, it's worth working out what it costs you to hold each year without deducting its ownership costs.

When you sell, CGT applies as it does to a rental, unless it qualifies for a full or partial main residence exemption because it was once your home.

Selling with a tenant in place

Selling doesn't let you end a fixed-term lease early: the tenant can stay until it ends. If the lease has become periodic (rolling on after its end date), you can give notice for a sale, but how much notice depends on the state or territory.

Most states and territories need evidence of the sale or the planned sale.

NSW, Victoria, Queensland and SA can also bar you from re-letting the property for six months after ending a tenancy for a sale, with some exceptions. In some states, you can give notice for a sale to take effect at the end of a fixed term.

Our guide to selling a property while it's tenanted covers inspections and working with your tenant, and our guide to the selling process as an investor walks through the rest.

Questions to work through before you decide

Take these questions to each conversation.

With your tax agent

• What would the gain and the tax be if I signed a contract this financial year, or next?
• If I still own it on 1 July 2027, should I get a valuation at that date?
• Was it ever my home, and does any part of the gain qualify for an exemption?
• Do I have capital losses I can use?

You can check a tax agent is registered on the Tax Practitioners Board register.

Get your clearance certificate. Every Australian resident seller needs an ATO clearance certificate to show the buyer you're an Australian resident for tax. Without one, the buyer must hold back 15 per cent of the price. It's free, can take up to 28 days and is valid for 12 months, so apply once you've decided to sell.

With a financial adviser

Ask whether selling, holding, switching or restructuring the loan suits your income, retirement plans and other investments. Moneysmart's guide to choosing a financial adviser explains how to find a registered adviser.

With two or three agents

Ask what it would sell for now, the recent sales behind that figure, how long similar homes are taking to sell, and what they'd do about the tenant. Our guide on how to sell your property sets out the process step by step.

Frequently asked questions

Where these figures come from

The tax rules come from the ATO and the law as it stood on 19 October 2026. The market figures are Cotality's, dated as they appear. 

• Capital gains tax reform (ATO)
• CGT events (ATO)
• CGT discount (ATO)
• Reforming negative gearing and capital gains tax (ATO)
• Holiday homes (ATO)
• Clearance certificates for Australian residents (ATO)
• Spring listings, August 2026 (Cotality)
• Pain and Gain report, June quarter 2026 (Cotality)
• Deeming (Services Australia)
• The notice periods come from each state and territory's tenancy authority: NSW, Victoria, Queensland, WA, SA, Tasmania, ACT and NT