🔎 Overview: What’s Changing and Why It Matters
Australia’s federal government is introducing controversial superannuation tax reforms that will see additional taxes applied to super balances over $3 million from 1 July 2026. Realestate+1
Under the draft legislation:
- Earnings on super balances above $3 million will be taxed at 30%, up from the current 15%. Forbes
- For balances over $10 million, the tax rate rises to 40%. BOX Advisory Services
- These changes only apply to realised investment earnings — not unrealised gains. BOX Advisory Services
While aimed at making super tax concessions “fairer and more sustainable,” as described by the Australian Treasurer, these reforms could have flow-on effects for the property market. Realestate
đź’ˇ How the Changes Could Affect Victorian Property Buyers
🧓 Older Borrowers & Retirees
Many older Australians rely on income from their superannuation when applying for mortgages later in life. If banks factor the new tax into their assessments, some borrowers — particularly those drawing super income — may see a slight reduction in borrowing power. Realestate
This is especially relevant in Victoria, where housing affordability pressures already push some buyers into later-life lending or retirement loans.
📉 Potential Market Shifts
đź“Ť Investors With SMSFs
Victorians who use Self-Managed Super Funds (SMSFs) to hold real estate may reassess whether it’s tax-efficient to hold property inside super. Higher tax on earnings — including rent and capital returns — could make holding property outside super more attractive in some cases. Realestate
This might influence:
- SMSF property acquisition strategies
- Long-term leasing decisions
- Investment property turnover rates
🏡 What Victorian Home Buyers Should Do Now
đź“Ś Tip 1: Talk to a Mortgage Broker Early
If you’re approaching retirement or relying on super income to qualify for a mortgage in Victoria, consult with a broker to understand how these changes might affect your borrowing power.
đź“Ś Tip 2: Consider Investment Structure
Speak with a financial planner about whether holding investment property within a super fund makes sense under the new rules.
đź“Ś Tip 3: Stay Informed
Draft legislation is open for consultation until mid-January 2026 — details may evolve before the final bill passes. Realestate
đź“Š Why This Matters for Victoria
Victoria’s housing markets — from Melbourne to regional centres — remain highly competitive. Any policy change affecting borrowing capacity or investor behaviour can ripple through:
- Loan approvals
- Property prices
- Investor demand
Victoria has seen strong home price growth and buyer demand in recent years, so even subtle policy shifts tend to carry weight in local market sentiment.
