It is possible to buy off-the-plan property in an SMSF; however, if you intend to take out a loan to do so, you will have to establish a bare trust as explained on our property page.
Buying off-the-plan property can be risky and Trustees must ensure that this type of investment is allowable and appropriate for their SMSF. One of the risks of purchasing with a mortgage is that if the lender’s final valuation comes in lower than the contracted price, you may be forced to make up the shortfall in your SMSF, which could be an issue if the SMSF does not have sufficient funds.
Points to remember when purchasing off-the-plan with loans in an SMSF:
When you’re ready, please send us the property details and instruct us to set up the Bare Trust for the SMSF.