From 1 July 2027, negative gearing concessions will largely be limited to new-build residential property, while existing investments will be grandfathered.

The Budget also delivered a $2 billion Local Infrastructure Fund for enabling works (roads, water, power and sewerage) to unlock up to 65,000 new homes over the next decade, bringing total government investment in housing-enabling infrastructure to $6.3 billion.

In addition, $8.6 billion has been committed over 11 years for nationally significant road and rail projects. For developers operating in growth corridors and regional centres, this is a meaningful tailwind.

From a policy perspective, the direction is clear: capital is being incentivised toward the creation of new housing supply rather than the recycling of existing stock.

From our perspective at Ark Capital, that matters.

A significant portion of our lending and investment activity already supports this segment of the market — particularly land subdivision, low-rise residential communities, and the infrastructure and civil works that ultimately enable new housing delivery.

Importantly, many of these projects sit within growth corridors and regional markets where population growth and housing demand remain strong, but where delivery has often been constrained by infrastructure bottlenecks, planning delays and access to capital.

While the construction sector still faces real challenges of build costs, labour availability and delivery timelines, the policy direction now appears more coordinated than it has in many years.

Housing supply is no longer being treated as a standalone planning issue; it is increasingly becoming a national economic priority.

For borrowers operating in the residential development space, particularly those delivering practical, attainable housing stock, this environment should create meaningful long-term opportunity.

As infrastructure investment and housing policy increasingly align, developers with well-located projects and access to experienced funding partners may be better positioned to navigate the next phase of the property cycle.

For investors, the picture is also evolving.

As traditional residential investment settings change, we expect many investors will reassess where they seek income, diversification and exposure to real assets.

With the CGT discount being wound back and negative gearing restricted for established property, the after-tax attractiveness of direct property investment is expected to shift.

Private credit funds such as ours, which can offer predictable monthly income returns backed by real property security, are becoming increasingly relevant for investors seeking yield without the complexity of direct property ownership in a changing tax environment.

No budget is perfect, and the construction sector still faces real challenges: elevated building costs, skilled labour shortages, and the time it takes for policy to translate into physical homes.

The opportunity is not simply in the policy shift itself, but in how capital responds to it.

In our view, the next phase of opportunity will increasingly come from those able to support, fund and deliver the housing supply Australia needs.