24/06/2026
SMSF Investors: The Window May Be Closing for Residential Property Purchases
If you've been considering using your Self-Managed Super Fund (SMSF) to invest in residential property, now is the time to pay attention.
Proposed legislative changes in Australia are expected to significantly impact how SMSFs can invest in residential real estate.
What’s Changing?
Current proposals indicate that SMSFs may soon be prohibited from borrowing funds to purchase residential property through Limited Recourse Borrowing Arrangements (LRBAs).
If implemented, SMSFs would no longer be able to leverage finance to acquire residential investment properties. Future purchases would need to be completed using available cash within the fund.
What Stays the Same?
Importantly, commercial property is currently expected to remain exempt from these proposed changes, meaning SMSFs may still be able to borrow for eligible commercial property acquisitions.
Why This Matters
For many Australians, borrowing through an SMSF has been one of the most effective ways to gain exposure to residential property while preserving liquidity within their super fund.
If these changes proceed, investors who have been sitting on the sidelines could lose the opportunity to use leverage for residential property purchases through their SMSF.
A Limited Window of Opportunity
With the expected implementation date approaching, investors who have already been exploring SMSF residential property strategies may wish to review their plans sooner rather than later.
The process of securing finance, obtaining advice, completing due diligence, and finalising contracts can take time. Waiting until the last minute may significantly reduce available options.
Legislation can change quickly, but opportunities often don't wait.
If residential property through your SMSF has been part of your long-term wealth strategy, this may be one of the last opportunities to secure an asset using borrowed funds before the rules change.
To learn more about current opportunities or discuss your SMSF investment options, contact Proxima Partners team today.
Disclaimer: Please verify the legislative status and timing with current legal or your SMSF specialists.
