SMSF Residential Property Loans After 10 August 2026

No, not for a new purchase. From 10 August 2026 an SMSF can only use a limited recourse borrowing arrangement to acquire real property if it is business real property. LRBAs entered into before that date continue and can be refinanced. A binding contract exchanged before 10 August 2026 can still settle with an LRBA.

Refinance lenders commonly accept around 70% to 80% LVR on an existing SMSF residential loan, depending on the lender, fund balance, cash reserves, contributions, rental income and property type. Some lenders are more conservative, especially for smaller funds, apartments, regional property or complex trustee structures. These figures do not apply to new residential purchases, which can no longer be funded with an SMSF loan.

No. A member of the SMSF, a relative or a related party cannot live in, rent or use residential property owned by the fund. This applies even if rent is paid at market value. Residential SMSF property must be kept as an arm's length investment.

For a new purchase, only with the fund's own cash. From 10 August 2026 an SMSF can no longer take out a new loan to buy a house, unit, apartment or townhouse. A cash purchase still has to meet the sole purpose test and fit the fund's investment strategy. The property cannot be bought from a related party, and no member or relative can live in it or rent it.

There are two broad pathways if you want to borrow. An SMSF can still borrow under an LRBA to buy business real property, such as an office, warehouse, shop, factory or medical rooms. Residential investment property can be bought outside super in a personal name, trust or company with a standard investment property loan. A fund can also buy residential property with cash and no loan. This is general information only. Get licensed SMSF, tax and legal advice before choosing a structure.

Yes. A binding contract to acquire real property exchanged before 10 August 2026 can still complete with an LRBA, even if settlement or the loan happens after that date. Lenders commonly look for a deposit of around 20% to 30% of the price, plus stamp duty, legal costs, lender fees and cash reserves. Off the plan contracts and other borderline timing questions need licensed SMSF advice.

Borrowed money under an LRBA can generally be used for the acquisition and certain repair or maintenance costs, but not to improve the asset. Major renovations or changes to the character of the property can create compliance problems while the borrowing remains in place.

Typical documents include the SMSF trust deed, corporate trustee details, bare trust documents, investment strategy, financial statements, member balances, contribution evidence, bank statements, current loan statements, lease or rental statements and identification documents. Each lender can request different information.