The biggest problem with the government’s negative gearing changes is not simply the policy itself.

It is who still gets to benefit from it.

Under the budget changes, existing investors are expected to be grandfathered into the current system. Australians who already own investment properties, including many politicians, can continue accessing the existing tax advantages and decades of capital growth opportunities.

Younger Australians and middle-income earners attempting to enter the market after the changes will face an entirely different set of rules.

That is the real fairness issue at the centre of this debate.

Many of those advocating these changes have themselves benefited, or potentially still stand to benefit, from the exact same property system they are now restricting for others.

Of course, there is nothing inherently wrong with using negative gearing to build wealth if there are sensible restrictions such as caps on the number of properties or the overall size of deductions. Those who have done so in the past have operated within the tax system exactly as it was designed.

But that is precisely why the broader political argument is becoming increasingly difficult to reconcile.

Why do established Australians get to continue benefiting under grandfathered rules, while younger Australians and middle-income earners lose access to one of the few remaining pathways into long-term wealth creation?

Because the demographic reality around negative gearing looks nothing like the caricature often presented politically.

Around two-thirds of negatively geared investors earn under $80,000 annually. Roughly 70 per cent own just one investment property. Women account for around 41 per cent of negative gearers. More than 100,000 Australians under 30 reportedly use the strategy, many through rentvesting because buying where they actually live and work has become impossible.

These are not all wealthy speculators with massive portfolios.

They are nurses, tradies, teachers, police officers, small business owners and younger professionals trying to build some form of long-term financial security.

This is modern Australia.

A young couple rents in Sydney while buying a modest apartment in Newcastle or regional Queensland. A nurse continues renting near a hospital while purchasing a more affordable property elsewhere. A younger tradesperson buys regionally while renting closer to employment opportunities.

This is not reckless speculation.

It is aspiration.

Restricting negative gearing only to new builds therefore deserves much closer scrutiny than the political slogans surrounding it.

At first glance, the policy sounds reasonable: encourage investment into new housing supply rather than existing homes.

But the practical reality is more complicated.

New builds are already significantly more expensive due to construction inflation, labour shortages, land costs and financing expenses. In many parts of Australia, newly constructed apartments and homes already carry substantial price premiums compared to established housing.

For younger Australians and middle-income earners, this change may actually push investment and wealth creation even further out of reach financially.

Many ordinary Australians simply cannot afford the higher entry prices and risks associated with off-the-plan developments or new housing construction.

At the same time, established properties often provide the lower-cost entry point many younger Australians rely on when trying to build financial stability.

Australia’s housing crisis is not primarily a tax deduction problem.

It is a borrowing capacity problem and a supply problem.

Higher inflation and interest rates have crushed borrowing power. Government spending remains elevated. Migration has also continued running ahead of housing supply, increasing competition for rentals and entry level homes while construction struggles to keep pace.

Those are the forces driving unaffordability.

Restricting negative gearing to new builds does not lower inflation. It does not improve borrowing capacity. It does not suddenly make construction cheaper.

If the government genuinely believed there were excesses in the system, there were more targeted ways to address them.

Limit the number of properties that can be negatively geared. Cap annual deductible losses. Tighten rules around very large-scale portfolios.

But instead, the government has effectively created a two-tier property system: one for Australians who already made it, and another for younger Australians trying to get there.

Does Australia still believe ordinary Australians should be able to build wealth through property ownership the same way previous generations, including many politicians, did before them?

Or has aspiration itself become something only existing property owners are allowed to keep?