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The Blog

Apr 17, 2024


Can I buy an investment property in my SMSF? How much super do I need to have in order to get started? Can I buy a commercial property with my SMSF and lease it back to my own business? Can I borrow money from the bank to buy property in my SMSF? Can my family members live in the property? Who are the lenders that offer finance solutions to SMSFs? What are the tax benefits? What are the fees and costs? If you encounter these questions, keep on reading! Opting to invest in property through your Self-Managed Super Fund (SMSF) can be a strategic move to fortify your financial prospects. When executed with precision and effective management, this approach can yield substantial tax advantages, concurrently fostering long-term growth in your super fund balance. A Self-Managed Super Fund (SMSF) is a trust structure designed for the administration of retirement savings on behalf of its members. To maintain compliance, SMSFs must adhere to the 'sole purpose' test, signifying their existence solely for the provision of financial benefits to members during their retirement years. Distinguishing itself from retail or industry superannuation funds, a SMSF appoints its members as trustees, empowering them to oversee operations for personal gain and uphold compliance with prevailing super and tax regulations. Investing in property through a Self-Managed Super Fund (SMSF) comes with stringent guidelines governing the type of property, purchase management, and property usage. Adhering to these regulations is crucial to prevent SMSF SISA breaches, ATO penalties, and potential non-compliance issues, ensuring alignment with the 'sole purpose test' requirements. Here's a breakdown of what a SMSF can and cannot do regarding property investments: 1.    Residential Property: An SMSF can borrow up to 90% LVR (Loan-to-Value Ratio) to purchase an investment property. An SMSF has the flexibility to opt for either long-term tenants or short-term Airbnb hosting arrangements. An SMSF can cover purchasing costs, many of which are typically tax deductible. Such as: Valuation fees; building and pest fees; legal fees; stamp duty, ongoing property management fees such as maintenance, rates, and insurance; commissions payable to real estate agents, such as buyer agent fees; loan costs, such as interest. An SMSF can buy a block of residential land and build a house on it as long as the SMSF has enough funds to complete without borrowing from external lenders. An SMSF is prohibited from purchasing a residential property from a fund member or any related party. Fund members or related parties are not allowed to stay in the residential property acquired by the SMSF. 2.    Commercial Property: An SMSF can borrow up to 80% LVR to purchase a commercial property. If an SMSF purchases a commercial property, it can be leased to a fund member for business purposes. The leasing arrangement must comply with market rates, lease term and specific regulatory guidelines. In Part Two, we will talk more about the advantages of property investment through your SMSF. Naturally, we'll explore the tax advantages that everyone is eager to understand better.

Apr 17, 2024

Why you need a Buyers Agent on your side!

Navigating the market, whether you’re a first-time homebuyer or a seasoned investor can be a daunting task. Having someone in your corner, working for your best interest could save you thousands of dollars on your property purchase.  And that is exactly what we as Buyers Agents do, we work for you! Knowledge of the Market: A Buyers Agent brings invaluable expertise, providing insights into market trends, property values and knowing the drawcards on different areas. Their expertise can help you make informed and empowered decisions before you commit to one of the biggest financial investments of your life. Tailored Property Search: Searching for the perfect property can be time consuming and overwhelming at best. A Buyers Agent simplifies the process by conducting a tailored property search based on your preferences, budget, and investment goals. They leverage their network and resources to identify properties that match your buying criteria, in turn saving you time and the hassle of sifting through countless listings. Negotiation Expertise: Whether it’s negotiating the purchase price, terms and conditions or contract clauses, a Buyers Agent works to secure the best possible deal for you. They can potentially save you thousands of dollars and ensure a smooth transaction process. Due Diligence & Risk Management: Purchasing a property involves a myriad of legal and financial considerations and it’s essential to perform thorough due diligence to mitigate risk. A Buyers Agent assists with this process by conducting research, reviewing property documents, and identifying any potential red flags. Access to Exclusive Listings: In Australia’s competitive real estate market, some of the best properties are often sold off market. Buyers Agents have access to these exclusive opportunities through their network and industry connections, which gives you a greater opportunity. End to End Support: From property search to settlement, a Buyers Agent is there every step of the way. We at Property Advisers Australia, liaise with other professionals such as conveyancers, mortgage brokers, and building inspectors to ensure a seamless and stress-free experience for you. In conclusion, the role of a Buyers Agent is essential for anyone looking to purchase property. By enlisting our services, you can navigate the competitive property market with confidence and peace of mind. Our team is committed to helping you make informed decisions and finding you the right property at the right price.