In Australia, you are allowed to use your superannuation to buy an investment property. Let’s see how it works.
Let’s say you have $150,000 in your super fund, a combined income of $100,000 and you want to buy an investment property using your superannuation.
The property is worth $500,000 so the loan amount would be $350,000.
The total income of the superfund will be from rent and employer contributions.
Rent at 4% as a rate of return.
Employer contributions at 9.5% which equals $9,500.
The total income between rent and contributions is $29,500 dollars per annum.
The expenses include:
Interest at say 6.5% equals to $22,750
Council rates and water rates equals $1,500
Insurance on the property equals $1,000
Landlord insurance equals $272
Management fee of around 7% which is equal to $1,400
Tax and audits on the superfund equal to about $2,000
Total expenses $28,922
Total income of $29,500 less $28,922 dollars in expenses is $578
The capital appreciation at say 5% of the property value is $25,000. At 5% per annum in capital appreciation in 10 years the property would be worth $814,447. At 7% per annum in capital appreciation in 10 years the property would be worth $983,576.
In summary, your $150,000 superannuation investment could be turned into a one million dollar investment in the next 10 years.
Let us show you that investing in property has never been so easy. We can help you understand how it works and give you the guidance and the safety nets to start.
For more information, call us on 1300 212 368 or email us at firstname.lastname@example.org.
Disclaimer: The enclosed information is for general information only must not be relied upon for any purpose. We cannot guarantee its accuracy. Any information of impression obtained should be checked with an independent financial adviser. Your full financials would need a review prior to acceptance of any offer or product.