SMSF property loans: your questions answered

Can I use my super to buy property?

Yes, though the borrowing rules change on 10 August 2026. Your SMSF can still buy residential property outright with the fund's own cash, and it can borrow to buy eligible commercial property using a limited recourse borrowing arrangement (LRBA). From that date, new borrowing to buy residential property will no longer be available, and existing residential SMSF loans are grandfathered and can still be refinanced. Any property the fund holds is owned by the fund, not you personally, and must be held for genuine investment purposes.

Is an SMSF right for me?

An SMSF isn't the right solution for everyone. If you're looking to buy commercial property through your super, want greater control over your retirement investments and are comfortable with the additional responsibilities of running an SMSF, it may be worth exploring. For others, remaining in an industry or retail super fund may be the better option. We'll help you understand the lending side of the decision, while your licensed financial adviser and accountant can advise whether an SMSF is appropriate for your circumstances.

What is an SMSF loan?

An SMSF loan is a loan made to your self-managed super fund, rather than to you personally. Today they're primarily used to purchase eligible commercial property or refinance an existing residential SMSF loan. These loans operate under a Limited Recourse Borrowing Arrangement (LRBA), a structure designed specifically for SMSFs.

What is a Limited Recourse Borrowing Arrangement (LRBA)?

An LRBA is the legal structure that lets an SMSF borrow to buy a single asset, such as one property. The property is held in a separate holding trust (bare trust) until the loan is repaid, and the lender's recourse is limited to that asset, not the rest of your fund.

How much super do I need to buy property?

There's no legal minimum. In practice, lenders generally want to see enough money in your SMSF to cover the deposit, purchase costs and retain a healthy cash buffer after settlement. For many funds, this is often around $150,000 to $200,000, although every situation is different.

How much deposit do I need for an SMSF loan?

SMSF loans generally need a larger deposit than standard home loans. For commercial property, most lenders lend up to 70–80% of the value, so a 20–30% deposit plus costs. For refinancing an existing residential SMSF loan, lenders can go higher - up to 90% LVR in some cases - since new residential SMSF borrowing ended on 10 August 2026. The exact figure depends on the lender and your fund.

How much can my SMSF borrow?

For commercial property, most SMSF lenders lend up to 70–80% of the value. Higher LVRs - up to 90% in some cases - now apply only to refinancing an existing (grandfathered) residential SMSF loan, as new residential SMSF borrowing ended on 10 August 2026. Your actual borrowing capacity also depends on your fund's income (contributions and rent) being enough to comfortably service the loan.

Are SMSF loan interest rates higher than standard home loans?

Usually. SMSF loans are a specialist lending product with fewer lenders than standard home loans, so interest rates are often slightly higher. That said, rates and lending policies vary significantly between lenders, making it worthwhile to compare your options.

Can I use an offset account with an SMSF loan?

Some lenders offer offset accounts with SMSF loans, while others don't. Availability depends on the lender and the loan product. If having an offset account is important to you, we'll help identify lenders that offer this feature.

Which banks lend to SMSFs?

The number of lenders offering SMSF loans is much smaller than the standard home loan market. Depending on your circumstances, both banks and specialist lenders may be suitable. We'll compare the available options and recommend lenders that fit your fund, property and long-term goals.

Can my SMSF buy commercial property?

Yes, and it's a popular strategy. Your SMSF can buy offices, retail, warehouses, industrial units or medical suites, and commercial lending is typically available up to 70–80% of the property's value.

Is commercial property better than residential in an SMSF?

Neither is inherently better. Following the 2026 rule changes, new SMSF borrowing is now generally limited to eligible commercial property, while existing residential SMSF loans can continue to be refinanced. Commercial property can offer attractive long-term opportunities, particularly for business owners wanting to own their premises through super. However, it can also involve longer vacancies, higher purchase prices and more active management. Whether it's the right strategy depends on your goals and circumstances.

Can my business lease premises from my SMSF?

Yes. This is one of the most popular uses of an SMSF. Your fund buys the premises and your business leases them back at market rent, so the rent builds your super instead of a landlord's wealth. The lease must be properly documented and at arm's length.

Can my SMSF buy a warehouse, factory, office or medical suite?

Yes. Subject to lender policy and the superannuation rules, an SMSF can generally purchase eligible commercial property including warehouses, factories, offices, retail premises, industrial units and medical suites. Each lender has different requirements around property types, loan-to-value ratios and acceptable security.

Can my SMSF buy vacant commercial property?

Yes, though lender appetite varies. Some lenders are comfortable with vacant commercial property, especially if your fund is strong. Having a tenant (including your own business) usually makes financing easier.

Can I refinance an SMSF loan?

Yes. If you've held an SMSF loan for a couple of years, it's worth a review: pricing and terms move over time. We review your current loan, show a clear cost/benefit after costs, and tell you honestly if staying put is the better call.

Can I access equity or cash out when refinancing an SMSF loan?

Generally no. Because of the limited recourse rules, an SMSF refinance is usually limited to refinancing the existing borrowing: you typically can't release equity or take cash out the way you might with a personal loan. Get advice for your specific situation.

What does it cost to refinance an SMSF loan?

Like any refinance, there are costs to consider: your current lender's discharge fees, establishment costs with the new lender, legal fees and, if applicable, break costs on a fixed-rate loan. Before recommending a refinance, we compare the total cost against the expected savings and any improvements to your loan structure or features. If the numbers don't stack up, we'll tell you.

Can I live in a property my SMSF owns?

No. A residential property held in your SMSF must be a genuine investment. You, your family, and anyone related to the fund cannot live in it or rent it, even at market rate, while it's owned by the fund. This is part of the 'sole purpose test'.

Can my SMSF buy property from me or a related party?

For residential property, no - your fund generally can't buy it from you or a related party. Commercial property used wholly for business ('business real property') is the key exception: your SMSF can buy it from a related party at market value.

Can I renovate an SMSF property?

You can repair and maintain the property, but you cannot use borrowed money to improve it or change its character (for example, turning a house into flats) while there's an LRBA in place. Improvements can be funded from the fund's own cash, within the rules. Always get advice first.

What is a bare trust?

A bare trust (also called a holding trust) holds the legal title to the property while the SMSF loan is being repaid. It's a legal requirement of an LRBA: the SMSF is the beneficial owner and takes full title once the loan is paid off.

Last updated: July 2026

This article is general information only. It doesn't take into account your objectives, financial situation or needs, and it isn't credit, financial or tax advice. Figures are indicative estimates that vary by lender, state and property and can change, so we confirm your real numbers before you act. For tax questions, speak to a registered tax agent or accountant. Scott Lung, credit representative 567904 of Purple Circle Financial Services Pty Ltd (Australian Credit Licence 486112).