What the ATO rental data shows before the changes begin

News Corp reported ATO data showing that 1.27 million landlords made a net rental loss in 2023-24, and drew on PIPA’s 2026 survey to show where investors are now selling.

What the tax data showed

On the 19th of September 2026, News Corp published two analyses of ATO data for the 2023-24 financial year, compiled by Carlisle Homes. Viva Hyde’s report for The Courier Mail and news.com.au found that 54.2 per cent of landlords, about 1.27 million people, recorded a net rental loss that year, the highest share since 2019-20. Nationally, deductions for mortgage interest doubled to $32.2 billion in two years, turning a collective rental profit of $6 billion into a loss of $2.7 billion.

In Queensland, interest paid on investment property rose from $3.29 billion in 2021-22 to $6.48 billion in 2023-24, moving the state’s landlords from a $712 million collective profit to a $593 million shortfall. Victoria recorded the largest swing, from a $702 million profit to a $2.53 billion loss.

Aidan Devine’s report for realestate.com.au and The Daily Telegraph found that negatively geared landlords were most concentrated in outer suburbs. In The Ponds and Schofields in Western Sydney, typical annual losses were about $9,000 to $10,000, and the average claimant owned a single property. Fewer than 1 per cent of claimants owned more than ten properties.

Where investors are selling

Both reports drew on PIPA’s 2026 Annual Investor Sentiment Survey. Queensland accounted for 37.1 per cent of the sales reported by investors, including 23.7 per cent in Brisbane and 13.4 per cent in regional Queensland. More than half of the sellers sold to an owner-occupier, and 12.4 per cent to a first home buyer.

These are not speculators flipping stock. These are people who have held a rental property for a decade or two and have decided they have had enough.

Cate Bakos, Chair of PIPA, quoted in The Courier Mail and news.com.au, the 19th of September 2026

Reading the data

The ATO figures describe 2023-24, before the budget changes were announced. They show the position investors were already in: rising interest costs had pushed most landlords into a net loss before the tax treatment changed. The changes remove the ability to offset that loss for established properties bought after the 12th of May 2026, from the 1st of July 2027, while existing holdings are grandfathered.

FoundIt head of research Kent Lardner told realestate.com.au that negative gearing made it possible for investors to supply rental housing in areas where yields were weaker. A house in The Ponds or Jordan Springs yielding about 3 per cent, as the article described, is unlikely to cover its costs at current interest rates without the deduction. The data suggests those are the areas where fewer new investors can be expected, and where rental supply depends most on existing investors choosing to hold.

The ATO data is two years old, and the survey records intentions and recent sales rather than the full stock of rental housing. Together they indicate the direction of change, and the areas where it is likely to be felt first.

An investor’s own position

An investor holding property in a lower yield area should know their net position after interest, costs and depreciation, and how it changes at higher rates. Qualified Property Investment Advisers can prepare that assessment, and PIPA’s advocacy continues to address the effect of tax settings on rental supply.