Apartment approvals rebounded 17.8% in June, reversing May's 11% fall. QLD +33.4%, VIC -13.9%, and only new builds keep negative gearing from 1 July 2027

This article is general information only and does not constitute financial or tax advice. Consult a qualified tax professional for advice specific to your situation.

This article is general information only. It does not consider your personal circumstances and is not financial, credit or tax advice. Speak to a licensed mortgage broker, buyer's agent or registered tax agent before acting on any of the figures below.

What the ABS actually released on 30 July

The ABS Building Approvals for June 2026 hit the wire at 11:30am AEST on 30 July. The headline numbers, in seasonally adjusted terms:

• Total dwellings approved: +7.2% for the month to 18,328, and 8.9% higher than a year earlier.
• Private sector houses: +0.4% to 10,631, the sixth consecutive month above 10,000.
• Private sector dwellings excluding houses (apartments and townhouses): +17.8% to 7,138, reversing the 11.0% fall in May.
• Value of total residential building: +15.1% to $11.75 billion for the month.

In trend terms, total dwellings approved rose 2.0% for the month, after a 1.3% rise in May. The trend is smoother and does not swing the way seasonally adjusted apartment numbers do.

Daniel Rossi, the ABS head of construction statistics, framed the print this way in the ABS release: approvals for private dwellings excluding houses rose by 17.8% in June, following the 11.0% fall in May, and private sector house approvals rose 0.4% in June, marking the sixth month in a row with more than 10,000 private sector houses approved across Australia.

The 17.8% apartment rebound is the number that will do the work in this piece, because it is the pipeline that matters most for the tax-preferred investor product from 1 July 2027.

The state split that changes the map

The national number hides a genuine two-speed print. Split by state:

• Queensland: +33.4% for the month.
• New South Wales: +13.2%.
• Western Australia: +10.7%.
• South Australia: -11.5%.
• Victoria: -13.9%.
• Tasmania: -22.5%.

Three states drove the national rebound. Three states went backwards on the same month. That is roughly 33 percentage points of dispersion between the strongest state (Queensland) and the weakest (Tasmania), and it lines up with the Cotality July Home Value Index we covered on 2 August, where Perth was the only capital still posting monthly value growth and Sydney and Melbourne led the national decline.

Approvals and prices are moving in the same direction in the same states. That is not a coincidence. It is the same investor and developer cohort responding to the same set of rate settings, tax rules and buyer demand at the same time.

Why this is the first "post-grandfather" print

The 2026-27 Federal Budget delivered on 12 May 2026 grandfathered negative gearing on established residential property purchased at or before 7:30pm AEST that evening. The tax settings any landlord planning a purchase now needs to hold in their head:

• Established residential bought at or before 7:30pm on 12 May 2026 keeps existing negative gearing under the current rules for as long as it is held. This is the grandfathered pool.
• Established residential bought between 12 May 2026 and 30 June 2027 can still be negatively geared under the existing rules through 30 June 2027, then loses full negative gearing from 1 July 2027. Losses on those properties from that date only offset residential rental income or future capital gains.
• Eligible new builds keep negative gearing under the existing rules on an ongoing basis. This is the ongoing tax-preferred product.

This is set out in the government's own budget documents and analysed across most of the major accounting firms.

The June 2026 approvals print is the first full monthly ABS release of new-build stock coming into the pipeline under the settings that will actually govern investor tax treatment from 1 July 2027. That reframes what a monthly approvals release means. It stops being just a construction indicator and becomes a leading indicator of tax-preferred investor buy-side inventory.

Every apartment approved in June that gets built and settles from 1 July 2027 is a full-negative-gearing product in a market where the alternative (established stock) does not carry the same tax treatment. Every apartment that does not get approved (or gets approved and does not start) is a hole in the pipeline of that tax-preferred product.

That is why the June rebound at +17.8% on apartments matters more than a typical monthly bounce. It is the first evidence that the redirection from established to new that the CBA housing team flagged after the Budget is starting to show up in the supply data.

What CBA is saying about the demand side

CBA's post-Budget housing outlook has been the clearest of the Big 4 on the mechanics of what negative gearing changes do to investor lending. The headline calls from CBA's economics team:

• New investor lending is expected to fall sharply through 2026, running at roughly half the volume of Q4 2025.
• The retention of negative gearing on new dwellings should redirect some of the investor demand that survives out of established residential and toward new builds, supporting construction activity and apartment presales in particular.
• Broader home prices are expected to be roughly flat over 2026, with investor-heavy segments (apartments, townhouses and lower-priced established housing) most exposed.

Put together with the June approvals print, the market is doing exactly what the tax settings were designed to trigger: less investor money into established stock, more capital toward new-build apartments, and developers responding by putting more apartment projects through council.

Whether the redirection is enough to matter for national supply is the next question.

The Housing Accord shortfall in plain numbers

The National Housing Accord targets 1.2 million new homes over five years to 30 June 2029. That is 240,000 a year or roughly 20,000 approvals a month at trend, before you deal with the further gap between approvals and actual completions.

June 2026 approvals came in at 18,328. That is 1,672 dwellings short of the 20,000-a-month pace, on a month where the seasonally adjusted apartment number bounced 17.8%.

Master Builders Australia's chief economist Shane Garrett has published that 47,750 fewer homes were built over the year to June than the Accord needed, and that this is the second consecutive year of Accord shortfall. Master Builders CEO Denita Wawn has flagged that the combination of rapid price escalation and mounting compliance obligations is pushing many projects beyond viability, and called for every available housing supply lever to be pulled.

For landlords, the Accord shortfall is not an abstract policy problem. It is a rental market thesis. Every year the Accord underdelivers by tens of thousands of homes, the vacancy floor sits lower and asking rents run harder against wage growth. That is the affordability ceiling picture we walked through in the May post: rents are already running well ahead of wages, and the binding constraint is what tenants can pay before they move out or downsize.

The June approvals data does not change that thesis. It marginally improves the pipeline, but not by enough to close the annual gap.

The state-by-state new-build map for the post-2027 investor

If you are a landlord planning to buy an investment property after 30 June 2027, the tax-preferred product is a new build. The June approvals release is a first read on where that new-build stock is being generated:

• Queensland (+33.4% for the month). Brisbane, the Gold Coast and Sunshine Coast markets are absorbing the biggest month-on-month lift in approvals. Combine that with the Cotality data showing regional Queensland still holding value while Sydney and Melbourne fell, and the case for Queensland new-build stock as the deepest tax-preferred pool from 1 July 2027 is real.
• New South Wales (+13.2%). Sydney and Newcastle apartment pipelines lifted. NSW is where the value falls have been sharpest, so new-build stock coming online into a falling established market could see softer presale pricing than developers underwrote 12 months ago.
• Western Australia (+10.7%). Perth is the only capital still recording monthly value growth on the Cotality index, and the June approvals lift compounds that. This is the state where new-build supply is arriving into a market that still has demand pressure behind it.
• Victoria (-13.9%), South Australia (-11.5%), Tasmania (-22.5%). The new-build pipeline in these three states went backwards in June. If that persists over three or four months, the tax-preferred inventory pool in those markets will be materially thinner than Queensland, NSW and Western Australia when the 1 July 2027 rule kicks in.

None of that is a buy or sell recommendation on a particular capital city. It is the input a landlord modelling a purchase for FY28 needs to have in front of them.

What this means for landlords already holding established stock

For a landlord who bought established residential at or before 7:30pm on 12 May 2026, the grandfathering does not go anywhere. That property keeps its full negative gearing treatment for as long as it is held. And the June approvals number, in a subtle but real way, makes that grandfathered stock more valuable over time, not less.

The reason is straightforward. The pool of grandfathered established stock is fixed. It cannot grow. Every established property sold after 12 May 2026 leaves the grandfathered pool and enters the post-1-July-2027 tax regime. Meanwhile, the new-build pipeline is what it is - constrained by the state splits above, by construction costs still running at 5.6% annual growth on the CPI, and by the same lending and labour constraints developers were dealing with in 2024 and 2025.

A shrinking pool of tax-preferred established stock, in a market where the alternative is either post-grandfather established (with materially worse tax treatment) or a constrained new-build pipeline, tends to command a scarcity premium. Not immediately, but over the next three to five years as the pool visibly shrinks.

The practical read for a grandfathered landlord: hold, don't panic-sell into the current Sydney or Melbourne weakness. The tax structure protects the position better than the value data alone suggests.

Where the data leaves the August 11 RBA decision

The 11 August RBA meeting was already tilted toward hold or cut after the June quarter CPI print came in at 3.6% trimmed mean, below the RBA's own May 3.8% forecast. The building approvals rebound reinforces the same picture from a different angle: supply is starting to respond to the negative gearing settings, developer confidence is picking up in three of the six states, and there is no sign in the June data that the economy needs another rate rise to cool it down.

The approvals release does not force the RBA's hand either way. It just removes one of the arguments (undersupply feeding into rents feeding into headline CPI) that a hawkish member might use to argue for a hike. The mortgage math for a $600k P&I investor loan we've been running through recent posts is unchanged by the approvals data. What changes for the investor is the buy-side inventory forecast, not the cost of holding what they already own.

What to do with this in the next 30 days

Three practical takeaways for a landlord:

1. If you are modelling a purchase for FY28 or later, map the tax-preferred inventory by state using the June approvals as your starting point and update it monthly. Queensland, NSW and Western Australia are your first lookups. Victoria, South Australia and Tasmania will need three or four months of consistent data before you can trust the pipeline.
2. If you already hold grandfathered established stock, resist the pull of the Sydney and Melbourne value falls. The grandfathering is the tax alpha, and it does not go anywhere while you hold.
3. If you are running a portfolio across multiple states, use the state splits to test whether your existing weighting still makes sense under the new tax regime. A portfolio that made sense in 2024 when negative gearing was uniform across all established stock may need rebalancing when only new builds carry it from 1 July 2027.

Track this in one place

The June approvals print is the third major AU property release in seven days, after the June quarter CPI on 29 July and the Cotality July HVI on 1 August. All three feed into the same underlying picture: rates on hold, values under pressure in the Big Two, supply responding in three states and going backwards in three others, and a tax regime that is starting to bend investor and developer behaviour in exactly the direction the 12 May 2026 policy was designed to bend it.

Propkt is built for Australian landlords managing this in real time. Track each property's mortgage repayments and cash flow against the current cash rate, log the deductible expenses that will matter at tax time under the new negative gearing rules, and model what a new-build addition to your portfolio would do to your monthly numbers before you sign a contract. The investor mortgage calculator is a good place to start when you're stress-testing a post-2027 acquisition against your current holdings.