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SMSFs drive property investment
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Self-managed super funds (SMSFs) are driving a new wave of investment in the residential property market as fears linger about sharemarket volatility in the wake of the global financial crisis (GFC), according to accountancy firm Chan & Naylor.
“Increasingly, our clients are saying they feel more comfortable with holding their retirement savings in property rather than shares,” said Chan & Naylor chief executive Sal Carrero.
“Increasing awareness of the potential of SMSFs to borrow and invest is creating new demand for residential property. It seems Australians feel comfortable with property as an investment class.”
The increasing popularity of SMSFs was partly due to the performance of super funds during the GFC, leading many Australians to ask themselves whether they could invest their own money better than their super funds, he said.
SMSFs are no longer restricted to wealthier investors, with savings of $150,000 sometimes enough to create a SMSF, he said.
“The reality is SMSFs are exceptionally tax-effective and provide options for estate planning and asset protection. However, as many as 60 per cent of current SMSFs lack the structures required to gain the full benefits,” Carrero said.
AUTHOR
Mike Taylor
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