Buying a Melbourne Property With Your Self-Managed Super Fund
Buying a Melbourne Property with Your Self-Managed Super Fund
In recent years, the use of SMSF’s to invest in residential property has increased significantly. While this is a valid investment strategy, there are a number of rules that must be adhered to when purchasing property with an SMSF.
Buying a Melbourne Property with Your Self-Managed Super Fund of the most important considerations is that SMSF’s can purchase property but it must be for investment purposes only and not be used to live in at any time. Furthermore, the property cannot be purchased from any related party of the SMSF. It is also a good idea to consider your own personal circumstances when choosing the type of property you want to purchase.
Purchasing residential property within an SMSF can be costly and you should be aware of all fees and charges involved before making a decision. There may be significant stamp duty, legal and maintenance fees to pay when acquiring an SMSF property. These fees can eat into your super balance so you need to ensure the income from your other investments will cover these costs and provide room for growth.
Investing in Melbourne Real Estate: Maximizing Returns with Your Self-Managed Super Fund
There is also the possibility that a property purchased by an SMSF will need to be renovated at some point in the future. If this is the case, it is crucial to understand the costs involved and whether these will be covered by your SMSF’s existing cash balance or from borrowings. When deciding whether or not to buy a property with your SMSF, be sure to consider all the facts and speak with both a Mortgage Choice broker and financial counsellor to ensure you are well informed.