The ATO's latest Self-managed super fund (SMSF) quarterly statistical report for March 2021 shows more than 6,000 new SMSFs were established in the three months to 31 March, with the total number now sitting at just under 600,000. 

Total estimated SMSF assets increased by 3% over the quarter to $787 billion, and while the most common asset types are still listed shares (26%) and cash or deposits (19%), the biggest increase was seen in property. 

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.99% p.a.
7.00% p.a.
$2,659
Principal & Interest
Variable
$0
$230
70%
Featured
  • Available for Purchase and Refinance. No application fee and no settlement fee
  • No monthly, annual or ongoing fees
  • Access your SMSF loan via our easy-to-use online app Smart Money
6.97% p.a.
6.97% p.a.
$2,653
Principal & Interest
Variable
$0
$500
70%
  • No fees for Refinance only (Excluding gov. charges)
  • Includes a 100% offset account and flexible repayment options
  • Build and manage your own nest egg with a Self-Managed Super Fund
7.24% p.a.
7.25% p.a.
$2,726
Principal & Interest
Variable
$0
$0
70%
7.25% p.a.
7.65% p.a.
$2,729
Principal & Interest
Variable
$30
$1,190
80%
7.75% p.a.
7.83% p.a.
$2,866
Principal & Interest
Variable
$0
$995
80%
7.55% p.a.
7.94% p.a.
$2,811
Principal & Interest
Variable
$395
$1,920
80%
7.49% p.a.
7.50% p.a.
$2,794
Principal & Interest
Variable
$0
$230
80%
Featured
  • Available for Purchase and Refinance
  • No application fee and no settlement fee
  • No monthly, annual or ongoing fees
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.


The total value of real residential property held by SMSFs grew by 6.36% ($2.64 billion) to more than $44.1 billion over the quarter, while limited recourse borrowing arrangements (LRBA) - which are often utilised by SMSFs for investing in property - also rose by 6.36% ($3.55 billion) to $59.4 billion.

Such loans limit the recourse of the lender, in that the lender can only repossess the asset (e.g. the investment property) purchased through the loan to recoup the debt should the borrower default. This is unlike the typical home loan, where the lender usually has full recourse to go after other assets too, such as cash in the bank or a stock portfolio.      

Related: What can you invest in with an SMSF? 

The ATO's data shows LRBA use stayed relatively stagnant over 2020 when the pandemic hit, after increasing in value by more than 10 times from $400 million about a decade ago. 

This recent increase is also in line with the Australian Bureau of Statistics' (ABS) most recent household lending data, which not only saw new loan approvals hit a new record high in March, but also recorded a substantial increase in investor lending after a 20-year low seen last year.

Prudential regulator data also shows total superannuation assets increased 3.1% for the quarter and 13.9% over 12 months to a record high of $3.1 trillion.


 Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
70%
Featured Online ExclusiveUp To $4K Cashback
  • Immediate cashback upon settlement
  • $2,000 for loans up to $700,000
  • $4,000 for loans over $700,000
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
Featured Apply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
6.14% p.a.
6.16% p.a.
$2,434
Principal & Interest
Variable
$0
$250
60%
Featured Unlimited Redraws
  • No annual fees - None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
  • Redraw freely - Access your additional payments when you need them
  • Home loan specialists available today
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of . View disclaimer.

The big four banks and many other institutions no longer offer LRBA loans due to their perceived risk and complexity, with the likes of Westpac and Commonwealth Bank ending their involvement in 2019. 

The 2014 financial system inquiry recommended banning LRBAs to “prevent the unnecessary build-up of risk”, with lower-income users generally the most disadvantaged by using these schemes. 

See also: When are SMSFs not worth the cost?

But it appears that hasn't deterred SMSF customers from using these loans.

Lenders still offering SMSF loans at the time of writing include: 

  • La Trobe Financial
  • Liberty Financial
  • Bank of Queensland (BOQ)
  • Switzer Home Loans
  • Mortgage House
  • Freedom Lenders
  • Reduce Home Loans
  • Rate Chaser Home Loans
  • LJ Hooker Home Loans
  • Regional Australia Bank

Photo by MayoFi on Unsplash





Disclaimers

Savings.com.au does not provide tax advice. This material has been prepared by Savings.com.au and is for informational purposes only, and is not intended to provide, and should not be relied on for tax advice.

For tax advice relevant to you, visit the ATO or consult an independent tax advisor.

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