Self Managed Superannuation Funds are able to invest in direct property. This can be a particularly attractive strategy for those who operate a business and have their superannuation fund own the premises. The strategy provides for long term income tax and capital gains tax benefits which often cannot be enjoyed if the property were owned in a non superannuation structure.
Although the benefits to holding property in superannuation can be significant, there are also pitfalls that can be encountered if the superannuation fund is invested too heavily in property or in an inappropriate property, which can lead to diversification and liquidity problems. It is imperative that a comprehensive planning process be undertaken before the decision to purchase property in superannuation is made.