Can You Still Buy Property Through Your Super?

What actually changed?

Self managed super funds can no longer borrow money to buy a residential property since 10 August 2026.

The change itself is about borrowing. It does not stop a super fund from owning property.

Previously SMSFs could use a limited recourse borrowing arrangement, or LRBA, to buy property. The idea behind this was that the fund borrowed the money to buy a particular property, and if the loan went bad, the lender’s rights were limited to that property, rather than the others in the fund.

This option is now closed for buying new residential property. Borrowing was only one way to get property into super though and other options still exist.

You can still buy property with cash in your super

If your super fund has enough money to buy a residential property, it can still do this. There is no borrowing involved, so the new restriction does not apply.

The fund can still own the property and rent it out, with the rental income returning to the fund.

The obvious issue with this is that you would need enough money in the fund to pay for the property without a loan. This is why borrowing was useful, as most people do not have the full purchase price sitting in their super.

As such, while buying a property with cash might still be available, it is not really a realistic replacement for borrowing in the real world.

Business owners can still borrow for their premises

If you run a business, your super fund can still borrow to buy the premises your business operates from, as long as the property qualifies as business real property. The new rules did not remove that option.

It can be helpful to a business owner and is essentially the super fund owns the property and the business pays rent to the fund instead of to an outside landlord. Over time this rental income will be part of the fund’s assets.

Plenty of rules govern how this must be structured, so it wouldn’t be a casual setup, but the strategy remains available.

If you already had a loan, nothing gets undone

This was one of the major concerns raised when the changes were announced. If your super fund had an LRBA in place, the new rules don’t force you to sell the property or repay the loan early. The existing arrangement can continue as planned.

You can even refinance an existing arrangement with another lender, as long as the refinancing meets the rules.

There was also protection for purchases in progress, so if you had a signed contract before the cutoff date, the transaction could still happen even if settlement was after the date had passed.

This change only applied to new borrowing and didn’t undo arrangements that were already in place.

Why the change matters less than the headlines suggest

It’s also worth getting a perspective on how big this market actually is. According to the government’s numbers, SMSF borrowing for residential property was less than one per cent of all home lending and less than half a per cent of new lending each year. Only a relatively small proportion of SMSFs used borrowing to buy property in the first place.

This doesn’t change that this was a way that some people went about buying, but taking it away doesn’t necessarily impact the rest of the property market or affordability for first home buyers. It is just one option removed for a small group.

The timing of the change also matters, because it was a part of a larger tax package that the government needed support for in the Senate. There was a political and housing argument about it, but the decision was also politically motivated.

For someone who was considering property through super, I would focus on the actual rules rather than make a decision based on the headlines.

What to focus on

If you were already thinking about buying property through your super, the first thing I would want to work out is if the strategy still works without borrowing.

• Does your fund have enough money to buy a property?
• If you are a business owner, would buying the premises through your super make sense?
• Or would you be better off buying the property outside super, either personally or through another structure?

These are all very different positions and there is no single answer that works for everyone.

There are other considerations to take into account as well, including the type of property, the rules around SMSF investments, the costs involved and what the purchase means for your retirement savings as a whole.

This is why I would get an accountant and financial adviser involved before doing anything. The rules around super and property are detailed and getting the structure wrong can be a very expensive issue.

Final word

You can still buy property through your super. What you can’t do is take out a new loan to buy a residential property with a self managed super fund.

You can still buy residential property if the fund has enough cash and business owners can still borrow to buy eligible business real property, with existing residential borrowing arrangements being able to continue under the rules they’re under.

So if you were considering property through super, I wouldn’t write it off due to the headlines. Start with your own circumstances and see which options are actually available to you.

The property itself is only part of the decision, because how you buy it, where you hold it and whether that structure makes sense for your long term position are just as important.