By Nicolette Connors, International Property Investment Strategist

Property investment for Australians has changed more in the past six months than in the previous decade. If you own investment property in Australia, or you’ve been planning to buy, the rules you built your strategy on are being rewritten. Meanwhile, Dubai recorded AED 574 billion (about AUD 225 billion) of property transactions in just the first nine months of 2026, and Australians are now among the top three nationalities buying there. After more than 20 years advising property investors, including many Australian clients, I believe it’s time for Australians to look seriously at opportunities outside Australia.

What has changed in Australia

Negative gearing is being restricted. In the May 2026 Federal Budget, the government announced that from 1 July 2027, net rental losses on established residential properties bought after 7.30pm on 12 May 2026 can only be offset against residential property income or gains, not against your salary. Properties bought before that time are grandfathered, and new builds are exempt. But for anyone buying an established property today, the tax advantage that underpinned Australian property investing for decades is largely gone.

The CGT discount is being replaced. From 1 July 2027, the 50% capital gains discount is due to be replaced by cost-base indexation and a 30% minimum tax on net gains. Gains made before that date keep the old treatment. Investors in new residential property can choose either method when they sell.

Interest rates are rising again. The Reserve Bank has raised the cash rate four times in 2026, most recently to 4.6% in September, its highest level in about 15 years. Some economists expect more. Every rise makes negatively geared property more expensive to hold, just as the tax relief is being removed.

Super is getting tighter. From 1 July 2026, Division 296 adds extra tax on super earnings for balances above AUD 3 million. The government has also backed a ban on new borrowing arrangements to buy residential property inside SMSFs. Using super to fund a residential investment is becoming harder.

More policy change is coming. Housing affordability is a central political issue, and Victoria goes to the polls in November. Investors should plan for further policy change rather than assume today’s rules will last.

Why investors are looking overseas

When the return on Australian property depends on tax concessions and rising prices, removing the concessions changes the numbers. Many Australian investors are now asking where their capital can earn a better return on its own merits.

Australians are already acting. Dubai’s property market recorded 165,018 transactions worth AED 574 billion (about AUD 225 billion) between January and September 2026, the second-highest nine-month total in its history. Recent brokerage data placed Australians among the top three nationalities buying, behind only the UK and India.

Better returns

Dubai apartments typically achieve gross rental yields of around 6% to 8%. Gross yields on apartments in Sydney and Melbourne are commonly around 3% to 4%. Dubai offers 0% personal income tax and no capital gains tax on property held by individuals. How Australian tax applies depends on your residency and structure, and I can introduce you to tax advisers who specialise in UAE investment.

Lower entry prices

You can buy a well-located one- or two-bedroom apartment in Dubai for the price of a modest unit in Sydney, and in many communities for considerably less. The UAE dirham is pegged to the US dollar, which also gives Australian investors exposure to a US-dollar-linked asset.

Payment plans and post-handover plans

This is the feature most Australian investors find surprising. Many developers in Dubai and Abu Dhabi sell off-plan property on interest-free payment plans:

• A deposit of typically 10% to 20% at purchase, plus the 4% Dubai Land Department fee.
• Further instalments during construction, often tied to building milestones.
• A balance paid on completion, or, with a post-handover plan, spread over two to five years after you receive the keys.

With a post-handover plan, the property can be earning rent while you are still paying for it, and without a bank loan or interest. Compare that with borrowing at today’s Australian mortgage rates.

An illustrative example

Consider an apartment priced at AED 1.5 million (about AUD 600,000) on a 60/40 post-handover plan:

• 60% paid over the construction period, interest-free.
• 40% paid over two years after handover, while the apartment is let.
• At a 7% gross yield, rent of around AED 105,000 (about AUD 42,000) a year, against roughly AUD 21,000 to 24,000 for a similar-priced Sydney unit at 3.5% to 4%.

These figures are illustrative only. Actual yields depend on the location, service charges, vacancy and management costs.

Where to start

I help Australian investors find, evaluate and buy property in Dubai and Abu Dhabi, and I manage the process from start to finish: legal representation, due diligence, payment plans, Golden Visa eligibility, banking and property management. My focus is on the investment that suits your goals, not the one being most heavily promoted.

If you’d like to talk about whether investing outside Australia makes sense for you, message me “AUSTRALIA” on WhatsApp.

Nicolette Connors is an international property investment strategist based in Dubai, with more than 20 years’ experience and over USD 2 billion in property transactions across the UAE, UK, Europe, Australia and New Zealand. She has advised Australian property investors for many years.

WhatsApp +971 58 551 6635 | nicoletteinvestdubai@gmail.com | LinkedIn | Instagram: @Nicoletteinvestuae | RERA Broker Card No. 94957

This article was first published on LinkedIn.