From 10 August 2026 a self-managed super fund can only enter a new borrowing arrangement to buy real property if it is business real property. Existing arrangements continue and can be refinanced. So residential SMSF lending for new purchases is closed; the rest is not.
Current as at September 2026.
If you ask your bank about borrowing inside your self-managed super fund, you’ll probably get one of two answers. “We don’t do that.” Or, since August, “You can’t do that any more.” Both answers are half right, and the half that’s wrong is the half that matters.
What actually changed on 10 August 2026
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 got Royal Assent on 26 June. From 10 August, a self-managed super fund can only enter a new limited recourse borrowing arrangement (an LRBA, the structure SMSFs use to borrow) to buy real property if that property is business real property. In plain terms: no new borrowing to buy a house or a unit inside super.
That’s a real change and it closed a strategy a lot of people were using. But look at what the ATO lists as unaffected: existing LRBAs entered before 10 August, refinancing of those existing LRBAs, and any binding contract exchanged before 10 August even if it settles later. And business real property borrowing continues under the same rules as before.
So “SMSF lending is over” is wrong. Residential SMSF lending for new purchases is over. The rest is still there, and in my view it’s the part that was always more interesting.
What counts as business real property?
The ATO’s definition is land and buildings used wholly and exclusively in one or more businesses. A warehouse. A shop. A medical suite. A childcare centre. The factory unit your own business operates out of.
That last one is the case I want to talk about, because it’s the one banks are worst at explaining. An SMSF is allowed to buy business real property from a related party. That’s an explicit exception to the usual rule that a fund can’t acquire assets from its members. Which means a business owner whose company rents premises from a landlord can, in the right circumstances, have their super fund buy premises and lease them to the business at market rent. The rent goes into super instead of to a stranger. The fund can borrow to do it. This was true before 10 August and it’s true now.
Whether it suits you is a question for your accountant and financial adviser, because there are sole purpose test issues, market rent requirements, an in-house asset limit of 5% of fund assets that the business real property exception sits outside of, and a lot of paperwork. I’m not giving that advice and neither should a broker. But the lending side of it is alive, and it’s where most of our SMSF work is now.
Why the bank says “we don’t do that”
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In our experience they mostly don’t. NAB’s super lending product, for instance, is a margin loan for shares and managed funds, not property. The lenders that publish SMSF loan products for business real property are largely non-bank and specialist lenders. Lender requirements differ by fund, and we compare the published SMSF products in Which lenders offer SMSF loans. Granite publishes a business real property SMSF product, and Liberty publishes SMSF loans at up to 80% of property value. (Some lender pages still describe residential SMSF loans. After 10 August those can only be refinances of existing arrangements.)
I’m naming those as lenders that publish products, not as recommendations. Each has different rules on fund balance, liquidity after settlement, minimum loan size and what they’ll accept as security. Which one, if any, fits a given fund is an assessment, and you won’t get it from a branch that doesn’t offer the product.
What a good SMSF lending conversation looks like now
It starts with what the fund owns and what the members want it to own in ten years. Then whether there’s an existing residential LRBA that could be refinanced onto better terms, because that door is open. Then whether business real property makes sense, which usually means the member runs a business that needs premises. Then, and only then, which lender’s policy fits the fund.
It doesn’t start with “which lender has the lowest SMSF rate.” SMSF loans generally cost more and carry more paperwork than standard loans, and the reason is the structure: a bare trust holding the asset, a fund as borrower, limited recourse for the lender. Fit matters more than rate here.
What would we tell a friend?
If you set up an SMSF specifically to borrow and buy a house, and you hadn’t exchanged before 10 August, that plan is gone and you should talk to your adviser about what the fund should do instead. If you already hold property under an LRBA, nothing has changed except that it’s worth checking whether the loan on it is still competitive. And if you run a business from premises you don’t own, the most under-discussed SMSF strategy in Australia is still available to you, and the bank was never going to bring it up.
The ATO counted 672,805 SMSFs at March 2026 with $1.06 trillion in assets. Property isn’t the biggest slice of that (listed shares are 26%, cash and term deposits 16%). But the funds that do own property, and the business owners who could, deserve a straighter answer than “we don’t do that.”
We work alongside your accountant and adviser on these. Call 02 9037 2825 if you want the lending side explained without the sales pitch.
This is general information only. Whether an SMSF, or property within it, suits your circumstances is advice you need from a licensed financial adviser and your accountant.
Frequently Asked Questions: SMSF Lending Isn’t What Your Bank Says It Is
Can an SMSF still borrow to buy property?
Only for business real property under a new arrangement entered on or after 10 August 2026. Existing residential arrangements continue and may be refinanced.
Why do banks say they don’t do SMSF loans?
Most major banks do not offer them. The lenders publishing SMSF products are largely non-bank and specialist lenders, and several work only through brokers.
Can my super fund buy my business premises?
In the right circumstances, yes. Business real property is an explicit exception to the rule against buying assets from a related party. Your accountant and adviser must confirm it suits the fund.
Further reading: the government’s Moneysmart guidance on self-managed super funds.
Related reading
- SMSF Loans Explained: How They Actually Work After 10 August 2026
- Can You Use Your Super to Buy a House?
- Buying Property With Superannuation: Rules and Risks
- More on SMSF lending
Book a broker or find a broker near you. Or call the Burwood office on 02 9037 2825.
General information only. This article does not take your objectives, financial situation or needs into account, and is not financial product, tax or legal advice. Lending criteria, fees and rates vary by lender and change without notice. Loan Lounge, Australian Credit Licence 515608.