SMSF Property Investment Guide (Australia): buying property with super via an LRBA

Most trustees use this guide as a “plan on paper” and then sanity-check the numbers in the SMSF Loan & Buffer Calculator. If the scenario still looks workable, the next step is lender policy mapping and document alignment via an SMSF mortgage broker while your accountant/adviser team confirms suitability and compliance.

What “single acquirable asset” means in plain English

LRBAs are commonly described as borrowing to buy a “single acquirable asset”. In practice, this usually means the SMSF is borrowing to acquire one property (or a single asset that fits the rules). If you’re thinking about multiple lots, development, subdivisions, major improvements, or non-standard structures, that’s the point where your adviser team needs to be closely involved, because the rules and lender appetite can change quickly.

This is a practical, trustee-friendly timeline. Exact steps vary by state, lender, property type and your adviser’s process. The goal is to avoid the two common failure modes: (1) signing a contract before the structure and lender policy are ready, and (2) leaving settlement dates too tight for SMSF documentation.

1. Confirm the strategy first: adviser checks suitability, investment strategy alignment, member ages/timeframes, and risk profile.
2. Sense-check the numbers: model repayments, liquidity and buffers using the SMSF loan calculator.
3. Choose “property intent”: residential investment vs commercial vs business real property (leased to your business).
4. Set your guardrails: target LVR band, minimum cash buffer, conservative vacancy/rent assumptions, and a “walk-away” point.
5. Pre-lender policy check: lender appetite for the property type, location, lease profile, and fund profile (including member ages).
6. Structure prep: solicitor + accountant confirm deed allows borrowing, bare trust setup, trustee structure, bank account requirements.
7. Get a credit quote: broker packages fund documents and runs lender-specific servicing (rates + buffers + shaded rent).
8. Offer / contract step: use a finance clause and realistic settlement timeframe; ensure contract names match LRBA requirements.
9. Valuation + credit: lender orders valuation, reviews lease (if commercial), and issues conditional approval.
10. Final docs: bare trust execution, loan docs, solicitor review, insurance confirmations and settlement statement.
11. Settlement: funds flow from SMSF/bare trust accounts, lender settlement, registration and final checks.
12. Post-settlement hygiene: update investment strategy and minutes, set rent reviews/lease compliance, maintain liquidity plan and review annually.

If you want this mapped to your specific scenario (residential vs commercial, state, target suburb and member ages), use the hero form and we’ll outline a “what happens next” plan without fluff.

A good rule of thumb: if you can’t clearly explain how the SMSF stays liquid and compliant if rent drops and rates rise, you’re not ready to sign. That doesn’t mean “don’t do it” — it means get your advice and lender policy lined up first.

This mini tool is a quick illustration. For lender-style tiles (repayment, liquidity, coverage) use the full SMSF Loan & Buffer Calculator.

Official sources: ATO LRBA guidance and ASIC MoneySmart (SMSFs).

Repairs vs improvements (why it matters)

Trustees often underestimate how strict the rules can be around improvements when borrowing is involved. In broad terms, borrowed money is often limited to acquiring the asset and normal costs of purchase. Significant improvements, developments or changes can trigger extra complexity. If your strategy relies on “buy and renovate”, flag that early so your adviser team can confirm what’s feasible and how lenders will treat it.

The exact list varies by lender and scenario, but most SMSF loan delays happen because the structure and documents are incomplete or inconsistent. Use this checklist as a practical “what to gather” guide.

The broker’s role is to package this information in lender-friendly form, and to spot the “gotchas” early (for example, entity name mismatches, lease gaps, thin liquidity, or assumptions that don’t pass servicing buffers).

The goal isn’t maximum leverage — it’s a plan that still works when something goes wrong. If you want to see how LVR and buffer settings change the outcome, run a few scenarios in the SMSF Loan & Buffer Calculator.

If you want lender-ready options, start at the SMSF mortgage broker page, then choose your closest location: Melbourne, Geelong, Ballarat.

SMSF property costs aren’t just the mortgage. Trustees should budget for the legal/structural side (bare trust), SMSF admin/audit costs, property outgoings, and the fact that LRBA rates can price above standard home loans. Your adviser team will confirm what’s relevant, but as a practical budgeting exercise, assume there are “more moving parts” than a standard investment loan.

A clean budgeting approach: assume a vacancy period, assume rates rise, assume expenses are higher than planned, and then see if the strategy still looks sane.

These are illustrative examples designed to show how trustees and advisers think about buffers, structure and lender fit. They are not advice and not a recommendation.

Case A — Residential SMSF investment (buffer-first approach)

A two-member SMSF in accumulation has a solid balance and chooses a conservative LVR to keep liquidity after settlement. The trustees model rent and vacancy conservatively, and they explicitly document their assumptions (rent, vacancy, buffer level, and contribution pattern) in minutes and their investment strategy update. The strategy is built to survive a normal vacancy period without pushing contributions to the cap.

Case B — Business real property (premises for the trading entity)

A business owner wants the SMSF to own the premises and lease it to the trading entity on market terms. The strength of the lease, the evidence of market rent, and the ability of the SMSF to stay liquid are central. The trustees treat documentation as non-negotiable: independent valuation support, lease terms, and clean payment behaviour that auditors can follow.

Case C — Near retirement (liquidity and exit planning)

A fund nearing pension phase considers property as part of a broader portfolio. The strategy avoids over-gearing because the fund needs flexibility for pensions and member benefit payments. Instead of chasing the highest LVR, the trustees choose a lower leverage profile, and they build an exit plan that doesn’t rely on selling at a perfect time.

If you want to map one of these patterns to your own fund (without guesswork), start with the calculator and then ask us to sanity-check it against lender policy and buffers.

Refinancing an SMSF loan can be possible, but it isn’t always straightforward. Some lenders won’t take refinances, and others require extra checks on the deed, bare trust, lease (if commercial), and property profile. Even when refinance is available, trustees should weigh savings against refinance costs and the risk of disrupting a clean structure.

• Structure consistency: lender wants clean alignment between deed, bare trust and loan docs.
• Property type filters: policy differs on commercial vs residential vs specialised assets.
• Valuation sensitivity: if values move, LVR can change quickly.
• Cash buffers: refinance still needs liquidity comfort.

If your goal is “lower the rate”, a repricing conversation may be the simplest first step before full refinance work — but the best path depends on your lender and structure.

SMSF property isn’t a “buy and forget” strategy. Trustees should be clear on how the fund exits: holding long-term, paying down the LRBA faster, refinancing, or selling. The exit plan should be realistic under less-than-perfect conditions (flat market, vacancy, higher costs).

Your accountant/adviser will model tax and retirement outcomes. Our role is to keep the lending side aligned with that plan so you don’t get stuck with a structure mismatch later.

Quick definitions. Expand any item below.

We help trustees, accountants and advisers align lender policy, buffers and LRBA documents before contract. Start here: SMSF Mortgage Broker (Australia-wide).

Local pages: Melbourne, Geelong, Ballarat.