"My wife and I had $70k each in superannuation –
 we had no idea we could turn that into a $380,000
 property."

– David & Mary, 30–somethings

"Our previous Financial Adviser knew we wanted to buy
 property, but recommended we buy managed funds
 instead. Thank you Super Investment Strategists for giving
 us control over our retirement nest egg!"

– Paul & his father Peter

"I can't believe I'm using my super to borrow and buy
 property! I wish I had seen Super Investment Strategists
 sooner."

– Michael, a young executive

"It made sense to us to take advantage of the tax
 effectiveness of superannuation when considering our next
 property purchase. Now we won't pay any Capital Gains
 Tax!"

– Ken & Barbara, Pre-retirees

"We thought it was obvious to deal with a Firm that could
 walk us through the entire process."

– Bill & Elizabeth, a working family

"All our money has been made from property.
 Why would we invest our super anywhere else?"

– Shaun and Michelle, Investors

How the strategy works

Once you have established a Family Superannuation Fund (FSF, otherwise known as a Self–Managed Superannuation Fund – SMSF), we 'roll over' funds from the existing super funds held by you and the other Members (NB: Members can be up to three other people from your extended family). The SMSF then borrows (via a limited recourse loan) to invest in a property, which is purchased through a Security Custodian Trust (AKA 'Bare Trust') with a Corporate Trustee. This may sound complicated, however our expertise is here to guide you.

Once the property has been purchased, all financial dealings will be directly with your FSF. This means that your FSF will be responsible for loan repayments and expenses. It will also receive rent as if the property was directly owned by your FSF. Your FSF's account will also show the property as an asset (and not as an investment in trust units).

Once the mortgage is fully repaid, the legal ownership of the property can be transferred from the Bare Trust to your FSF.

We have consulted Lenders who are offering LVRs of 70 – 80% on residential real estate purchased in this manner. Below is a visual description of how the strategy works:

Please refer to the Case Studies page for examples of how the strategy has worked for others.

Invest super in property diagram

Tips

  • By making your 9% Superannuation Guarantee Contributions (SGC) to your Personal Super Fund, you may be able to save 15% in contributions tax – ask us and we will explain how!
  • If you have an existing SMSF, be sure to get the Deed inspected before implementing this strategy.
  • If you sell the property when you retire (i.e. in pension mode), any capital gains on the sale of the property will be completely tax–free.
Strategy

Traps

  • You can't buy the property to live in it, even if you pay your Fund rent. Nor can you buy any property that you or a member of your family already owns.
  • Do not buy a property 'off the plan' without getting advice first.
  • You can buy a property in your super fund to develop it – but there are specific rules about the use of borrowed funds. Once again, get our advice first!

In general, if you are unsure of anything be sure to get our advice. The penalties for non–compliance can be very severe.

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