26/08/2026
🏠The Negative Gearing Trap
A bigger property loss may give you a bigger tax deduction—but you’re still losing real money to receive only part of it back.
If your investment property loses $8,000 and you’re in the 37% tax bracket, your estimated tax benefit may be around $2,960.
That still leaves approximately $5,040 coming out of your pocket.
Negative gearing isn’t automatically bad, but it shouldn’t be your permanent strategy. It should be supported by:
âś… Strong capital-growth potential
âś… A plan to increase rental income
âś… Improving cash flow over time
âś… A clear exit strategy
The goal isn’t to create the biggest tax deduction. The goal is to own a quality asset that grows in value and eventually pays for itself.
Before buying, understand the real numbers—not just the potential tax refund.
Strategy first. Location second. Hype last.
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