Understanding SMSF Investing

Investing in property in an SMSF can be quite lucrative if it’s done correctly and the right properties are purchased.

The biggest advantage is the power of leverage.

For example, if you had $250k in your Super and that is invested through a fund and the fund grows by 10% you have made a $25k gain for your $250k investment. However, if you could take that $250k and purchase a $650k property and that property grows by 10%, you have now made a $65k gain for your $250k investment.

Whilst maybe news to some, there is no such thing as a set and forget property. However, having said that any property purchased in an SMSF should be as close as possible to set and forget. This would be done through ensuring it doesn’t need any work and it’s in a location with consistent rental capacity.

There are several things to consider before rushing ahead and starting up an SMSF to purchase investment properties:

  • The cost of setting up the SMSF
  • The cost of administration and compliance (accounting and auditing) every year.
  • Insurances that you may have in your existing Super Fund.

SMSF’s are heavily regulated as they should be, so you need to be aware of what you can and can’t do with a property in your SMSF. I come equipped with the practical experience you need to get a SMSF property purchase right, the first time.