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Property Investment FAQs
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Concentration risk: one property often ties up hundreds of thousands into a single asset, reliant on one market and tenants. Rising rates, vacancies, or regulatory changes magnify exposure. Planners test resilience across income, debt, and retirement projections to confirm whether property risk is justified or overexposed.
Taxes include stamp duty (opens in a new tab), land tax (opens in a new tab), and capital gains tax (CGT) on sale (opens in a new tab). Interest and expenses may be deductible. Inside super, earnings are taxed at 15% (0% in retirement phase) (opens in a new tab). A planner coordinates tax strategy to reduce leakage while keeping compliance airtight across ownership structures.
Each has trade-offs. Personal ownership allows negative gearing but exposes assets. SMSF ownership offers tax advantages but strict restrictions. Trusts provide flexibility and estate planning benefits but add costs. A planner compares structures against income, CGT outcomes (opens in a new tab), and family succession to recommend the most efficient option.
No, SMSF members cannot occupy residential property owned by their fund, even after retirement. The sole-purpose test (opens in a new tab) prohibits personal use. Retirement-phase pensions from SMSF property income can support lifestyle, but living in the asset itself breaches law. Planners ensure compliance while maximising retirement income.
SMSF property must be maintained on commercial terms and rented at market rates. Occasional Airbnb use may breach sole-purpose rules (opens in a new tab) if personal benefit is involved. Planners explain the compliance risks and test whether alternative property or investment structures achieve flexibility without risking fund non-compliance or tax penalties.
Generally, no, unless it’s business real property (opens in a new tab). SMSFs cannot acquire residential property from members or related parties. Selling non-compliant property risks heavy penalties. A financial planner clarifies what transactions are allowed and models whether retaining or selling outside super is more tax-effective for your circumstances.
Yes, SMSFs can purchase property under strict rules (opens in a new tab). Borrowing requires a limited recourse loan (opens in a new tab), and the property must meet arm’s-length requirements (opens in a new tab). Personal use is banned. Planners guide on compliance, setup costs, and long-term retirement implications to ensure SMSF property strengthens rather than burdens your fund.
It is typically 20% of purchase price plus costs like stamp duty (opens in a new tab) and legal fees. Smaller deposits may attract lenders’ mortgage insurance. Financial planners assess whether using cash, equity, or super is most efficient by weighing leverage risks against diversification and long-term retirement goals.
It depends on income, deposit, and long-term objectives. Property can deliver growth and tax benefits but ties up capital and carries concentration risk. A planner tests scenarios against super, shares, and debt strategies to show whether property genuinely advances wealth or creates liquidity and cash-flow problems.
Property advice isn’t restricted to choosing suburbs or yields. A financial planner models cash flow, loan structure, gearing, tax impact, and superannuation interactions. They ensure property fits within your overall plan, not as a siloed bet, so the decision supports retirement goals rather than undermines them.