EDITION 16
From The Experts:
Is SMSF Lending Right For You?
Here’s what you need to know
In recent years, I’ve seen more Australians turn to Self-Managed Super Funds (SMSFs) as a way to invest in property and strengthen their retirement savings. As of September 2024, there were over 630,000 SMSFs in Australia, with more than 1.1 million members. This growing trend reflects a clear desire for greater control over how superannuation is invested – and for many, property offers the potential for strong, long-term returns.
At Loan Market Newcastle CBD, I’ve helped more and more clients explore SMSF lending as a tool to diversify their super. Property investment through an SMSF can deliver both capital growth and rental income, which can be a smart strategy for long-term wealth accumulation – if done right.
Using an SMSF, you can borrow to buy property through what’s called a Limited Recourse Borrowing Arrangement (LRBA). The key benefit of this setup is that if the loan defaults, the lender’s recourse is limited to the asset itself – so the rest of your super remains protected. You can use this structure to buy either commercial or residential property, as long as it complies with superannuation regulations and meets the sole purpose test (which means it must genuinely support your retirement outcomes).
“Property investment through an SMSF can deliver both capital growth and rental income, which can be a smart strategy for long-term wealth accumulation – if done right.”
The numbers support the growing interest. Between June 2021 and June 2024, SMSF investments in residential property jumped by 26.4% to $55.2 billion, and commercial property holdings increased by 25% to $102 billion.
That kind of shift shows how many Australians are embracing property as a tangible, growthoriented retirement asset.
“Between June 2021 and June 2024, SMSF investments in residential property jumped by 26.4% to $55.2 billion …”
That said, this strategy isn’t for everyone. There are plenty of rules to follow, from loan structure to property use and fund compliance. It’s absolutely essential to get the right advice. What I share here is general in nature, and I strongly recommend speaking with a qualified accountant or financial planner to see if this fits your personal circumstances.
Using your super to invest in property can be a powerful way to grow your future wealth- but only with the right guidance and planning.
If you’re wondering whether SMSF lending could work for you, I’d love to chat. My team and I at Loan Market Newcastle CBD are here to help you understand your options and see what’s possible. Reach out for a no-obligation conversation and take the first step toward a more empowered financial future.
Heath Williams
Loan Specialist
Email heath.williams@loanmarket.com.au
Loan Market Pty Ltd Australian Credit Licence 390222
Phone (02) 4920 6468