Current value
$200k$4m
Selling now also releases the loss pool
Sell or Hold Calculator - which path ends larger
Sell now, pay CGT, redeploy the proceeds - or hold, carry the cash flow, and sell later. Both paths compound at the same alternative return, with the post-2026 loss pool applied at whichever sale happens.
Holding ends ahead over 10 years - under your assumptions
Hold advantage
$87,190
Crossover
Year 1
when holding pulls ahead
Sell now
Net proceeds today$239,500
CGT (indexation)$0
Loss pool released$22,143
At 7% for 10 yrs$471,133
Hold 10 years
Net proceeds at end$652,155
CGT then (indexation)$90,146
Pool released then$102,627
Cash flows, compounded−$93,832
Both paths compound at the same rate; the end positions are $558k holding vs $471k selling. Arithmetic against your inputs - not a recommendation.
The hold, year by year
| Yr | FY | Value | Rent | Costs | Interest | Tax effect | After tax | Loss pool |
|---|---|---|---|---|---|---|---|---|
| 1 | 2031 | $861k | $33,280 | $9,500 | $34,160 | $0 | −$10,380 | $50,380 |
| 2 | 2032 | $904k | $34,445 | $9,833 | $34,160 | $0 | −$9,548 | $59,928 |
| 3 | 2033 | $949k | $35,650 | $10,177 | $34,160 | $0 | −$8,686 | $68,614 |
| 4 | 2034 | $997k | $36,898 | $10,533 | $34,160 | $0 | −$7,795 | $76,409 |
| 5 | 2035 | $1.05m | $38,190 | $10,901 | $34,160 | $0 | −$6,872 | $83,281 |
| 6 | 2036 | $1.10m | $39,526 | $11,283 | $34,160 | $0 | −$5,917 | $89,197 |
| 7 | 2037 | $1.15m | $40,910 | $11,678 | $34,160 | $0 | −$4,928 | $94,126 |
| 8 | 2038 | $1.21m | $42,341 | $12,087 | $34,160 | $0 | −$3,905 | $98,031 |
| 9 | 2039 | $1.27m | $43,823 | $12,510 | $34,160 | $0 | −$2,846 | $100,877 |
| 10 | 2040 | $1.34m | $45,357 | $12,948 | $34,160 | $0 | −$1,750 | $102,627 |
Costs grow with rent growth; established-class losses quarantine from FY2028 and the pool releases against the gain at sale. Capital works deductions use the flat annual figure entered.
Selling to buy again? Audit the replacement purchase before you commit to the exit.
The reform made selling a tax event on both sides of the ledger
Before 2026, holding versus selling was mostly a growth-versus-fees argument. For a quarantined-class property it is now also about a pool of trapped deductions that only two things can unlock: future rental profits, or the sale itself. An owner carrying a large pool sells into a smaller CGT bill than the headline gain implies - and every negatively geared year of holding makes that pool bigger. Neither instinct ("never sell" or "cut the loser") survives contact with the actual arithmetic.
The comparison is only honest if both paths face the same discipline. Here the sale proceeds compound at your alternative return, and so do the hold path's interim cash flows - a negatively geared year is money that could have compounded elsewhere, and it is charged accordingly. The crossover year tells you how long the hold needs to be for the property to win; if that is longer than you would realistically hold, the answer has told you something.
Estimate your pool with the negative gearing calculator, check the class with Am I Grandfathered?, and price the CGT mechanics in detail with the CGT calculator. If the sale funds another purchase, the investment property calculator prices the replacement under the new rules.
Frequently asked questions
How does the quarantined loss pool change a sell or hold decision?
For an established dwelling bought after 12 May 2026, rental losses from July 2027 accumulate in a pool instead of reducing your salary tax. That pool releases against the capital gain when you sell - so selling is now also the event that unlocks trapped deductions. A large pool makes selling cheaper than the headline gain suggests, and holding longer while negatively geared keeps growing it. This calculator applies the pool at whichever sale it models.
How is CGT calculated on each path?
By the statutory method for your acquisition class. Grandfathered holdings keep the 50% discount on the whole gain. Quarantined-class holdings split the gain at the deemed 1 July 2027 reset: the earlier slice keeps discount treatment, the later slice is CPI-indexed with the 30% minimum tax rules. Both the sell-now sale and the end-of-horizon sale use your true original cost base, capital works claimed to date, and the pool.
What is the alternative return and what should I use?
It is what the sale proceeds would earn if they were not in this property - an index fund, an offset against your home loan, another asset. Both paths compound at the same rate: sale proceeds on the sell side, interim rental cash flows on the hold side, so the comparison is symmetrical. Compounding is modelled pre-tax on both sides; tax on the alternative depends on where the money goes.
Why does the answer flip with small assumption changes?
Because the two paths are usually close - the decision is rarely as lopsided as it feels. Growth compounds on the full property value while the alternative compounds only on your freed equity, which is why growth assumptions dominate. Test the number at growth a percent lower than you believe and see if the answer survives.
Is this telling me to sell?
No. It computes which path ends larger under assumptions you set, shows the crossover year, and itemises the tax on each side. Agent fees vary, lending positions differ, and concessional windows (like a main residence election) are not modelled. The output is arithmetic against your own inputs, not advice.
Operating costs are entered as one annual figure grown with rent growth; alternative-return compounding is pre-tax on both paths; main residence elections, vacancy and re-letting gaps, and lender break costs are not modelled. The deemed-sale valuation at 1 July 2027 uses the engine's geometric interpolation unless a valuation exists. General information only.