Gday All,
Has anyone got any advice in regards to setting up a SMSF to purchase IP's.
Pro's and Con's ????Hi Sgoodes,
Due to changes in the last few years in regulations of SMSF’s now being able to borrow to invest in property … this has changed the landscape of the Super arena in many ways … giving the SMSF more control and flexibility in your options to invest. One of my companies deals with Property and another of my companies deals with investments with SMSF’s with a mandate for mining (from seed capital/IPO’s to Listing on the Exchange). We deal with many SMSF’s.
Always best to seek professional advice and remember you can only purchase ‘completed’ investment products eg you can not borrow through a SMSF to build a house … you can only borrow on the completed dwelling.
There is plenty of info available now – the main thing is working out what you are actually trying to achieve and want to achieve.
Are you doing it becuase you have heard someone say it is a good idea, are you cashed up with super, and do you have other investment properties?????
If you have cash in the SMSF to buy the property outright as opposed to borrowing to purchase that also makes a difference.
You need to make sure your SMSF is 'able to borrow' and for each property purchased you have to set up an additional 'bare trust' or security trust with a company as trustee – so if you had an accountant or organization charge you 'retail' to do this you are talking thousands of dollars to set up and administer as well as some charging you thousands for auditing each year.
If you can get a good deal on property and have long term plans it can be a great idea…….but it's all relative.
Deal with professionals that have experience with this and don't be a guinea pig for a crusty old accountant doing there 1st SMSF and if borrowing there is plenty of other stuff to think of.
All the best with your journeyHi everyonee, I have purchased a property through my SMSF which I am happy to say is positively geared. I am now looking to buy another. Is 15000 enough for finance people to look at us purchasing with.?
Hi Novacastrian,
I am assuming that you are in NSW? It depends on the state as that would dictate the SD payable. If you have $15k then you would be able to purchase a property for approximately $60k. With an SMSF, you need to come up with the 20% deposit (minimum some lenders ask for more depending on the scenario) and the SD costs and also the upfront costs which vary from approx $700 to $2500 again depending on the lenders. Also you need to ensure that the property type is acceptable security to hold in the SMSF under the lender's policy.
How long did it take to positively gear your property?
Regards
Shahin
TheFinanceShop | Elite Property Finance
http://www.elitepropertyfinance.com
Email Me | Phone MeResidential and Commercial Brokerage
Hi Shahin, due to property shortages in the Hunter region we were able to secure tenants that offered extra rent to secure the property. Hence the mortgage LVR 80% is paid by the tenant.
regards
Peter
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