Property investors are in uproar over Anthony Albanese’s agreement with the Greens to force through his budget with critics calling it a “dodgy deal” that will hurt “mum and dad” property investors.

To secure the Greens’ budget support, the Prime Minister agreed to prevent people from using a loan loophole, called Limited Recourse Borrowing Arrangements (LRBA), that allowed self-managed super funds (SMSF) to borrow money and invest in residential properties.

Australians will still be able to invest in property through their SMSF, but they won’t be able to borrow money to do so. Existing LRBA arrangements won’t be affected.

Mr Albanese has defended the move which he said affects less than one per cent of property borrowing and frees up housing stock.

“These reforms will make it easier for Australians to buy their first home,” he said.

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An LRBA has previously been one of the most tax effective methods of purchasing an investment property because super enjoys tax breaks such as 10 per cent capital gains tax when the property is sold and zero tax if retirees are aged over 60.

Around one in 10 SMSF had an LRBA. Buying property through super is more common in investors over the age of 50.

The Greens have also delayed changes to the government’s plans to implement cost cuts to the NDIS bill by ordering an eight-week extension to an inquiry.

‘Dodgy deal’

Furious backlash from investors to the changes erupted on social media, led by real estate coach Tom Panos.

“Just when you thought it couldn’t get worse, it just did. You can’t believe this is actually happening,” he said.

“Australians are looking at this and you know what they’re asking?” Mr Panos added. “Why would I take risks? Why would I invest? Why would I sacrifice and plan for the future if you’re going to just keep changing the rules.”

“Don’t forget, this is another thing the Labor government said they weren’t doing a year ago.

“Not billionaires, not corporate giants, I’m talking about tradespeople, small business owners, farmers, mum and dad investors. That’s the group of people that were using the superannuation fund.”

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Property investor Jack Henderson, who sometimes wears a “greedy landlord” cap, also took to Instagram to rage about the changes: “The old mum and dad investor has just been f***ed again”.

“The normal mum and dad property investor or just investor in general is going to become more and more limited.

“My belief is that this has nothing to do with the property market. This has everything to do with the Labour and the Greens wanting to keep more of your superannuation in the industry funds that are controlled by their good friends, the unions,” said Mr Henderson.

Fellow property investor Sam Gordon was also outraged, telling followers that “this Australian government was about as un-f***ing-Australian as you can get”.

“Overnight, dodgy, dodgy deal made with the Greens to get their budget passed through the senate.

“Another broken promise by Albo …

“All these things coming in, this is literally the most un-Australian government I’ve ever seen. Let’s take opportunity away from the battler, let’s literally not give them the option of what they want to do in their super fund,” said Mr Gordon.

“You can’t go down the route of property and create wealth how you decide with your super.”

PM hails budget changes a win for young voters

Anthony Albanese hailed the deal with the Greens to secure the package of capital gains tax and negative gearing reforms as a win for younger voters seeking to buy their first home.

The Prime Minister confirmed the deal on Tuesday, flanked by the Treasurer Jim Chalmers, Finance Minister Katy Gallagher and Health Minister Mark Butler.

Mr Albanese said it was about making the tax system fairer for ordinary taxpayers, not just wealthy investors with accountants.

“Our tax reforms will give better alignment for income earned from work with income earned from assets and wealth,’’ he said.

“Most Australians have nothing to sell but their time and nothing to give but their hard work; that’s how they earn an income and put food on the table.

“We want those people, those hardworking Australians, to have the opportunity to own their own home.”

With Sam Maiden.

Read related topics:Anthony Albanese