Can I Use My Super to Buy a House?

In a climate of rising house prices and tighter lending conditions, many Australians are wondering: Can I use my super to buy a house? The answer is yes — but it depends on whether you’re buying your first home or using a Self-Managed Super Fund (SMSF) to invest in property.

Below, we break down how superannuation can support your property purchase goals — whether that’s buying your first home to live in or purchasing an investment property.

Option 1: Using Super to Buy Your First Home

The First Home Super Saver (FHSS) Scheme allows eligible first home buyers to withdraw certain super contributions to help with a house deposit. It’s one of the most tax-effective ways to accelerate your savings and potentially get into the market sooner.

How the FHSS Scheme Works

Under the scheme, you can make voluntary contributions to your super fund — including both concessional contributions (such as salary sacrifice) and after-tax contributions — and later request a withdrawal to put toward buying your first home.

• The maximum release amount is currently $50,000 per person (up to $15,000 per financial year).
• Contributions must be personal super contributions — not regular employer contributions.
• You’ll need a FHSS determination from the Australian Taxation Office (ATO) before making a release request.

Note: The funds can only be used to purchase residential property — not vacant land or an investment property — and the purchase must occur within 12 months of withdrawal.

FHSS Scheme: Tax Benefits and Considerations

Using the FHSS can offer serious tax savings:

• Concessional contributions are taxed at just 15%, often lower than your marginal tax rate.
• On withdrawal, the assessable income portion is taxed at your marginal tax rate, minus a 30% offset.
• This can lower your overall tax liability while boosting your home deposit.

Eligible voluntary contributions must be made within the same super account, and the ATO will calculate your associated earnings using a deemed rate of return.

Option 2: Buying an Investment Property Through an SMSF

If you're not eligible for the FHSS or you’ve already purchased your first home, your superannuation can still help you purchase property — but only through a Self-Managed Super Fund (SMSF).

An SMSF allows you to invest in residential or commercial property (such as offices or warehouses) as part of your retirement strategy.

Key Features of SMSF Property Investment

You can use an SMSF loan under a Limited Recourse Borrowing Arrangement (LRBA) to acquire property and all rental income and capital growth stays within the super fund, offering potential tax advantages. Loan repayments and property expenses must be made from the SMSF.

However, the process is highly regulated, and strict rules apply:

• You cannot live in the property or rent it to a related party (for residential properties).
• The investment must satisfy the sole purpose test — benefiting your retirement only.

Comparison Table: FHSS vs SMSF Property Purchase

Final Thoughts: Should You Use Super to Buy Property?

For driven professionals, superannuation can be a powerful tool to get ahead — either by helping with a home loan deposit under the FHSS or by purchasing an investment property through a Self-Managed Super Fund.

But both options come with complexity. Whether it’s understanding your concessional contributions, navigating ATO processes like an FHSS determination, or complying with SMSF rules, professional tax advice is essential.

Ready to Explore Your Options?

At Causbrooks Finance, we help professionals like you use your super to purchase investment property.

Book a free consultation today and take the first step toward owning your future.