How to maximise your return on investment in your SMSF
Are you looking for a risk mitigated, high yielding investment property, yield linked to CPI and guaranteed for 20 years?
Where you Invest say $650k to earn an income of $100k* pa, linked to CPI
Whether looking for that extra income to pay down your own home loan or create another $100k in Super
Industry Funds continue to perform poorly, dramatically affecting any compound growth potential for you and thus a far lower end value at the time of you wanting to retire. Long term industry super funds perform at 5% – 7% over the life of your investment. Meaning it will take you around 15 years to double your capital
If you increased it to even 10% average, every 7.2 years your Investment Value would double!
What if you earned 15% pa on the same monies in a risk mitigated investment which is linked to CPI (meaning income increases) and guaranteed for 20 years
Looking for a high yield, risk mitigated investment property in your Super?
Can you imagine the ideal investment with a yield of around 15%, underpinned by a property you own, in which you are doing a massive good turn by housing someone with a disability …. we call this a win-win-win Investment.
The Australian Government have a major looming issue in that there are over 400,000 people with disability who need a place to call home, with most wanting to live as normal a life as possible within our communities.
Our government is unable to provide housing and have thus incentivised investors who kindly put up their hands to secure a SDA dwelling and rent it out to tenants who qualify under the NDIS scheme
For doing so, the government will :
Guarantee your income for 20 years
Link the rental income to CPI
Help us make a difference & accommodate as many humans with disability in purposefully built homes & make a positive impact, when you give someone with a disability the gift of “the of living as normal a life as possible, that includes independence and an ability to thrive.”
Stock Market too volatile to protect your Life Savings in Super?
Industry and Retail Funds Performance not meeting your expectations and requirements?
Wanting consistent yields of 7% to 18% or thereabouts?
Looking to mitigate your investment risk profile?
By answering yes to one of the above or more then you would want to understand how a NDIS Investment Property or SDA Property Investment could be a solution for your SMSF requirements.
When investing in a Special Disability Accommodation Property you are giving your Super choice and an element of much needed control as SDA Property includes several risk mitigation criteria which includes higher than market yields, backed up by the Australian Federal Government for a period of 20 years, where your rental income is linked to CPI having the added advantage of ensuring your yield increases alongside inflation.
Investing in Bricks and Mortar over a 7 – 10 year period is viewed as a lowrisk profile investment. When you have an investment underpinned by Federal Government, as part of the National Disability Insurance Scheme, you could achieve a sense of comfort knowing your investment is primarily de-risked.
Why SDA Property
There is a tragic undersupply, exacerbated by a growing demand for rental accommodation to comply with and meet the needs of a tenant with disability.
With around 400,000 fellow humans in the NDIS and around 28,000 who have made application for independent housing opportunity the government is just unable to meet this growing need.
There are also around 6,000 young people with disability housed in Aged Care facilities who are doing it tough as this just does not suit them. Why be ‘locked up’ in a facility that is designed to house our elderley population just because you are disadvantaged by a disability. For goodness sakes, this is a dire situation and we need to help where we can.
This also means that 6,000 elderly people we love and care for are unable to get into the aged care system because the ‘wrong’ type of person is occupying a much needed bed.
A win-win Investment
By now you may realise that where there is a major (and growing problem), therein lies your investment opportunity.
The Australian Government put in place a significant annual budget to encourage you the investor to put your hand up so that you may become part of the solution in providing a new dwelling in which a person with disability who is approved under the NDIS can become your tenant.
For doing this, your incentive is two fold :
Very high rental yields, above market rates over a 20 year period
A social do excellent, feel great investment by giving someone who is less able than us the opportunity of living as normal a life in and amongst our communities
Your investment includes
Above market yields
Risk Mitigated Investment
Ability to pay off the loan in 7 – 10 years
Creation of an excellent residual income stream for your Super
Peg your income alongside CPI
Making an incredible positive impact on someone less able than we are
“a win/win for Investors with significant social outcomes”
Informed Investment Decision
Read more here on how you can secure a sound investment into bricks and mortar which is risk mitigated, whilst making a positive impact
Residential Property in a Self Managed Super Fund under a lease agreement with tenants paying rent will incur expenses relating to the property which can be claimed and include the following :
Property administration
Insurance (building, contents, public liability)
Advertising for tenants
Property agent’s fees and commission
Some legal expenses
Interest expenses – if the property is part of a limited recourse borrowing arrangement
Rates and taxes
Body corporate fees and charges
Council rates
Water and electricity paid by landlord, but not those paid by the tenant
Land tax
Property maintenance
Cleaning the property
Gardening and lawn mowing
Pest control
Repairs and maintenance but not the cost of improvements
Capital works deductions
Travel expenses to inspect property, not deductible after 1 July 2017
Depreciation
Depreciation of the property can be claimed against contributions made to your SMSF
Talk to your Accountant
What we are sharing with you is of a general nature and your accountant or industry professional will clarify what you are able to claim which will vary according to type of property and tenancy
If you have made improvements or are considering making improvements understand the financial and tax implications and whether or not you are legally able to make the improvements (especially where there are borrowings in the SMSF on this property)
Other types of rental property could include Air B&B, Holiday House, Bed and Breakfast, Vacant Land
Tax Deductions are there for the taking
On speaking with your accountant or industry professional who is able to provide tax advice, take advantage of all claims you have at your disposal so that the tax man and your tenant are helping contribute towards your retirement planning
REMEMBER : Not all property is Investment Grade and very few residential properties lend themselves to being investment grade especially residential property in a SMSF. We understand residential property in Super and can point you in the right direction when it comes to identifying which property and which property strategy would work best for you and your Self Managed Super Fund requirements.
As a trustee of your SMSF; “it is imperative that you get your Investment Decision right at the outset, as this will impact on your return on investment over the next 7 – 10 years or longer!”
