Property investor credit growth crashes after budget tax changes

Changes to negative gearing and capital gains tax in the federal budget have driven a sharp decline in investor credit growth.

The Reserve Bank of Australia’s (RBA) credit aggregates data for July, illustrated below by Justin Fabo from Antipodean Macro, shows that investor housing credit growth slowed sharply to 0.46%, down from the recent peak of 0.95% in December 2025:

“The slowing in investor housing credit growth in Australia is broadly consistent with a decline in related Google search activity”, Fabo notes:

The federal budget’s changes to negative gearing and capital gains tax have reduced investors’ borrowing capacity by around 30% due to reductions in after-tax cash flow.

The sharp slowdown in investor demand from the changes is a key driver of the nation’s housing correction, which is shaping up to be the largest in at least 40 years.