One of the most common questions I hear from people nearing retirement is whether to keep everything or sell something. It is often asked as a yes or no question. It rarely is one.
Selling a property changes several things at once. Holding it changes nothing, and that is a choice too. The clearer you are on what moves and what stays put, the easier the decision becomes.
What changes when a property is sold
- The rent stops. Whatever that property earned, net of its costs, leaves your income.
- The debt against it is usually repaid from the sale. That lowers the interest you pay, which can lift your income, sometimes by more than the rent you gave up.
- There are costs on the way out. Agent's fees, marketing and legal costs come off the price before you see the proceeds.
- There may be capital gains tax. How much depends on how long the property was held, how it is owned, and what else happens in that financial year.
- The money left over has to go somewhere: to clear other debt, to sit as cash, into super if the rules allow, or to fund something else. Each produces a different income.
I have met people who sold in a hurry and only found out later how much tax the sale cost them. The time to see that figure is before the contract is signed, not after.
The 2027 change to capital gains
From 1 July 2027, capital gains are taxed differently. For a property you hold on 30 June 2027, the gain up to that date keeps the 50 per cent discount, with the value on that date marking the line. The gain after it is taxed under the new rules: the cost base rises with inflation, and a minimum tax of 30 per cent applies. For some people this makes the timing of a sale matter more than it did; for others it changes little. It is a question for an accountant with your own figures.
What does not change
The other properties are still there, with their own rent, costs and loans. Selling one does not fix a structure that was set up for growth across the rest. Your need for income does not change either. The question is still how much you need each year, after tax, in today's money, and for how long.
And the choice is not all or nothing. Between keeping everything and selling everything there are usually several positions worth looking at.
Doing nothing is a position too
When I set out a client's options, keeping everything is always the first position. Every other route is measured against it on the same terms. Holding can turn out to be the stronger position. Selling one property can change the picture a great deal. Selling more can leave you with less income. Until the positions sit side by side, it is very hard to tell which.
That is why Position and Pathways shows the positions you are weighing next to each other, each with its income after tax in today's money and the basis for every figure. The decision stays yours. It is made with the numbers in front of you rather than on a feeling.
Nicholas Lockhart
General information only. No advice is given. This article reflects the law as at 10 October 2026. Tax outcomes depend on your own circumstances; an accountant can work through the figures for a particular sale.
Source: Australian Taxation Office, Tax reform: reforming negative gearing and capital gains tax.