We can help you use the money in your Self-Managed Superannuation Fund to buy commercial and business property, and — depending on your timing and circumstances – residential property too.
Legislation passed in 2026 restricts SMSFs from taking out new loans for residential property, while commercial and business property purchases remain open. If you already have an SMSF loan, it isn’t affected. Because the rules around timing and eligibility can be technical, get in touch and we’ll walk you through what’s possible for your situation.
What is an SMSF loan?
An SMSF loan is a loan used to buy residential or commercial property with your self-managed super fund (SMSF). The investment returns, whether rental income or capital gains, go back into your super fund. This increases your retirement savings over time.
With the right SMSF loan, self-managed super fund structure, and property type, you can potentially save hundreds of dollars in account and ongoing fees. An SMSF loan also gives you flexibility and freedom to:
- Plan your retirement on your own terms
- Choose an investment to suit your lifestyle and investment goals
- Gear into property by borrowing within a Self Managed Super Fund
Commercial and business property remain open to SMSF borrowing. Residential property is more restricted following 2026 legislative changes – talk to us about whether it’s still an option for you.
We arrange the lending side of an SMSF property purchase. Whether an SMSF or this kind of borrowing suits your circumstances is a financial advice question, so we always recommend confirming this with a licensed financial adviser or your accountant before you proceed. We’re happy to work alongside them once you’re ready.
SMSF Case Study.
Mark owned a successful electrical contracting business and wanted his SMSF to invest in a commercial property while giving his business a long-term base of operations. His SMSF had accumulated $240,000, which it used towards the purchase of a warehouse and office in NSW through a Limited Recourse Borrowing Arrangement (LRBA).
The property was purchased for $500,000. After allowing approximately $25,000 for NSW stamp duty, legal fees, lender costs and other purchase expenses, the total funds required were around $525,000. The SMSF contributed $225,000 towards the purchase and costs, while borrowing $300,000, resulting in a 60% loan-to-value ratio (LVR) based on the property’s purchase price. For illustration purposes, the loan used an indicative variable interest rate of 7.80% p.a.
After settlement, Mark’s electrical business leased the property from the SMSF under a commercial lease at market rent of $650 per week (approximately $33,900 per year). That rental income, together with ongoing employer and personal super contributions (subject to contribution caps), helped the SMSF meet its loan repayments and other fund expenses. Depending on the lease terms, many commercial property outgoings may also be payable by the tenant.
For Mark’s business, owning the premises through the SMSF provided greater certainty over its long-term location without requiring the business to purchase the property directly. For the SMSF, the strategy provided exposure to a commercial investment while receiving rental income from an established tenant. As with any related-party lease, the rent and lease terms needed to remain on arm’s-length, market-value terms and comply with the superannuation laws.
Property values can fall as well as rise, and borrowing inside an SMSF magnifies both gains and losses. As trustee, you’re also personally responsible for meeting your fund’s legal and compliance obligations. This is why getting financial and legal advice alongside your loan structuring matters.
Need some help?
Not sure where to start? That’s exactly what we’re here for. Drop us a message and we will get back to you within one business day with clear, honest advice tailored to your situation.