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Using Your SMSF to Buy Property

SMSF for residential property

Buying residential property through your SMSF

There’s plenty of upside when using super to buy property, including tax incentives and asset appreciation. Yet it’s a complex area, with rules around what you can and can’t do.

What you need to know: When using super to buy property, you need to distinguish between buying a property using funds from the SMSF and purchasing a property via a SMSF home loan.

That’s why it’s useful to consult our specialist SMSF residential property loan brokers. Rouse Hill, Sydney, is our base, but we have national scope to help clients navigate this demanding sector. We guide you through the different options, advising on the best way forward.

When buying a self-managed super fund property, remember:

-It cannot be lived in or rented by you, your trustees, or trustee relatives, ruling out a holiday home for personal use.

– You cannot place a residential property you currently own in a SMSF. It must be a new purchase.

However, with the right loan, fund structure and type of residential property, your SMSF can be a powerful asset-building tool.

Leveraging your SMSF to invest in commercial property

Using your SMSF to buy commercial property is a popular choice for SME owners. You can buy commercial premises via your SMSF, then pay rent to the fund to lease it back.

However, the following regulations are monitored by the ATO.

-Rates must be based on genuine market value – no ‘mates’ rates’ – and all transactions must be carried out on strictly commercial terms.

-Regular property valuations are required to ensure you pay a fair rent.

-Rent is due strictly on time, and self-audits must be done annually.

-The property you buy must meet the ATO definition of ‘business real property’, passing the business use test.

SMSF investment for property

Getting it right

We can help you avoid the common pitfalls when buying property with super.

Did you know, for instance, that the loan must be set up as a limited recourse borrowing arrangement (LRBA)? This means the property is security for the loan, but other fund assets are protected if the loan is defaulted.

So if you’re looking for a SMSF commercial property finance broker in Rouse Hill or in wider Sydney, call us for specialist expertise.


This is a niche area. Lenders currently accepting SMSF applicants include Liberty Financial, BOQ, LaTrobe Financial, Granite, Thinktank and Mortgage Ezy.

For residential and commercial properties, it’s a maximum of 80% LVR. However, this can be lower depending on the postcode.

You can buy residential, commercial or industrial properties. Residential properties cannot be lived in by the fund owner or trustees. Commercial and industrial premises can be self-occupied by the owner’s business.

It’s important to consider the full range of professional fees involved with this specialist purchase. Ask your SMSF mortgage broker for details.