A landlord with 200 properties says rookie investors are set to be 'wiped out' by the sweeping reforms to negative gearing and capital gains tax set to be announced in tonight's Federal Budget. 

Serial investor and buyers' agent, Eddie Dilleen, 32, has grown his portfolio by about 120 homes within the last year, but he doesn't care that property tax incentives are set to be scrapped when Treasurer Jim Chalmers hands down the Budget on Tuesday.

Labor is expected to abolish negative gearing for future investment properties and replace the 50 per cent capital gains tax discount with an inflation-indexed concession.

While existing rental properties and new builds may be exempt, there's also speculation about limits on the number of properties an individual can negatively gear - none of which will be confirmed until the Budget is tabled at 7.30pm.

Whatever the outcome, Dilleen - who told the Daily Mail he owes $60million in mortgage repayments - is unfazed and plans to continue acquiring 'undervalued' residential properties across Australia, and he'll advise his clients to do the same.

He told the Daily Mail that 'rookie investors trying to get started will be wiped out' by the sweeping reforms, but that he has never personally relied on negative gearing as a strategy.

'Some of my properties are negatively geared, but the worst shortfall after expenses is only about $70 to $80 per week,' he said.

'That's unfortunately not the case for the majority of investors, and they'll really hurt when this happens because they've bought property that's negatively geared at $500 to $600 per week - and they've bought two or three.'

Under the current negative gearing tax policy, investors can offset those losses against their income. This reduces the owner's taxable income, sometimes pushing them into a lower tax bracket and substantially reducing the money owed to the ATO.

The new scheme will stop this practice going forward, potentially forcing landlords who rely on buying up properties to negatively gear to consider alternative financial strategies. 

Dilleen said the biggest mistake buyers make is using their first investment for a big house, which is often cashflow negative and will likely not be offset under the new laws.

He said it often takes about two or three houses to either generate wealth or to accrue enough equity to buy a big house for retirement. 

'The strategy is to have a property that might only be negative $70 a week, but if you're buying a big house with a lot of negative cash flow, it's not sustainable,' he said.

'Everyone wants to buy the biggest house straight away, but I bought what I could afford.'

He also doesn't care if property values fall by as much as 50 per cent after the changes are implemented because he can still use the equity from his portfolio to grow his holdings - which is not an option for most asset classes.

'At the end of the day, property is a leveraged asset and you can get into it with only 20 per cent,' he said.

'If I wanted to buy $1million worth of shares, I'd need $1million in cash. But with property, I can get a 20 per cent deposit using the equity from my other properties - and it's tax-free.'

Modelling suggests property prices could fall by up to four per cent under the reforms, rather than 50 per cent.

Asked about the potential removal of the capital gains discount, Dilleen warned it could force investors who do not rely on negative gearing to hold their assets, further throttling the market.

'Out of the 200 properties I own, why would I sell them if I'm going to get smashed with tax?' he asked.

'I'd rather pull out the equity and use it for another property - that's what billionaires do, they don't sell.'

Despite speculation that negative gearing and the capital gains discount could remain in place for new builds, Dilleen said he would continue investing in existing homes because they're more affordable.

'People will move to off-the-plan, but it's ridiculously overpriced,' he said.

'I'm buying established units in Melbourne for half the price of off-the-plan units in the same street.'

Mr Dilleen was relaxed about the tax changes, urging Australians not to worry about any changes the government might make because there's nothing they can do about it.

'There's always changes to laws and legislation, but people stop worrying about the changes and the flow-on effect and focus on what they can actually do,' he said.

'I don't look at the outside stuff, I can only control what I can control and what I can do right now.'