Buying Property In SMSFs

More and more people are considering the use of Self-Managed Superannuation Funds to purchase property.

This form of investment can be highly productive, but yet there remains a lot of confusion about the best way to move forward with the plan. Here is a summary of some of the more important elements to consider.

What is a Self-Managed Superannuation Fund?

A Self-Managed Superannuation Fund (SMSF) gives you the opportunity to make investment decisions about your super, including investing your money in property. Whether it is commercial, investment or residential, there are rules and regulations that must be considered.

Property is one of those investment channels that most Australians feel very comfortable with. Over the long term, capital growth is typically very strong and having a diverse portfolio that you have control over is very favourable. See this page for more information on property investment advice.

When looking to purchase property via your super fund there are a few limitations that must be considered, as well as the benefits that you can enjoy.


Whilst there may be rules, there are many benefits felt by those who choose to use their superannuation money in the way they want to.

Tax Benefits: Save on capital gains tax if your property is sold when you hit the pension age and have retired; effectively putting you in the ‘pension phase’.

Control: You’ll achieve greater control over your superannuation funds instead of putting it into a fund and not really knowing for sure where it is being invested.


One of the biggest limitations is that you are restricted from directly benefiting from your purchase until you retire.

Resale: You cannot purchase a property with the sole aim to redevelop and resell it.

Family Members: You cannot purchase a property that belonged to a family member, friend or associate.

Investing Can Be Complicated

Establishing a SMSF can be complicated and using it to then invest in property adds another level of complexity. Having said that, it is a great strategy and if undertaken the right way, a positive experience. Make sure that the property you choose is right for you and keep level headed.

If you seek professional advice right from the start you’ll be wiser and know with certainty that your future financial situation is secure.

Frequently Asked Questions

  • What do I need to do when I establish self-managed superannuation?

    When you set up a self-managed super fund you need to:

    • Carry out the role of trustee, which imposes important legal duties on you.
    • Use the money only to provide retirement benefits.
    • Set and follow an investment strategy that ensures the fund is likely to meet your retirement needs.
    • Keep comprehensive records and arrange annual finanical returns and complete audit by a qualified auditor.
    • And, don’t forget to purchase separate life insurance coverage if you have a self-managed super fund.
  • What do I need to run a self-managed super fund?

    You will generally need:

    • There is much mis-information about how much you actually need in super to commence a SMSF.  The answer is it really depends on the strategies agreed on for your SMSF and contributions being made. Speak to us further if you think an SMSF is right for you.
    • To anticipate ongoing expenses such as professional accounting, tax and legal advice.
    • Plenty of time to manage the fund.
    • Financial experience and skills.
    • Separate life insurance, including income protection and total and permanent disability cover.