Bridging Finance Tipped to Move Centre Stage as Budget Tax Changes and Slower Property Sales Reshape the Market

Shifting tax rules and slower property sales are creating strong demand for bridging finance, with industry experts predicting it will become a mainstream product in 2026, according to The Adviser (June 2026).

Why Bridging Finance Demand Is Growing

Longer time on market: As interest rate pressures and budget uncertainty slow buyer activity, properties are taking longer to sell. Homeowners who need to move can't rely on a quick sale, making bridging finance an essential tool to avoid missing out on their next property.

Negative gearing and CGT tax changes: The federal government's reforms to negative gearing and capital gains tax — currently under Senate inquiry — are prompting many investors to reassess their property portfolios. Buying new before selling existing creates timing gaps that bridging finance solves.

Developers and investors repositioning: Those who bought in the low-rate era are now managing refinancing deadlines, project completions, and exit timelines simultaneously. Bridging finance provides the flexibility to manage complex property transactions.

How Bridging Finance Works

A bridging loan is typically secured against both the existing property and the new purchase:

Unlike standard home loans, bridging finance is assessed primarily on the value of the security properties and the borrower's exit strategy — not just income.

The Non-Bank Advantage

Major banks are generally slow and restrictive with bridging finance. They often require full income documentation, strict LVR caps, and complex approval processes taking weeks.

Non-bank lenders like MPFG Capital can move faster, assess each case individually, and fund scenarios banks decline — including self-employed borrowers with Alt Doc income, or situations with tight timeframes.

Who Should Consider Bridging Finance?

• Homeowners who have found their next property but haven't yet sold the current one
• Property investors restructuring portfolios ahead of tax changes
• Developers needing short-term funding to complete a project before refinancing
• Buyers at auction who need certainty of funds before settlement

FAQ

Q: Is bridging finance expensive?

A: Bridging loans carry higher interest rates than standard home loans because they are short-term and higher risk. The cost is usually justified by the value of not missing a property purchase or by avoiding a forced sale.

Q: Can self-employed borrowers get bridging finance?

A: Yes. Non-bank lenders assess bridging finance primarily on the property security and exit strategy, making it more accessible for self-employed borrowers who may not qualify under standard bank criteria.

Q: What happens if my property doesn't sell in time?

A: This is why a clear exit strategy is critical. Borrowers should plan for the possibility of an extended settlement and discuss contingency options with their lender before taking out bridging finance.

Source: The Adviser, 1 June 2026. This article provides general information only and does not constitute financial advice. Lending is subject to eligibility assessment.