An SMSF can invest in commercial or residential property, but note that you cannot live in the property, use the property as a holiday house or have a family member live in it. For more information on investing in property with your SMSF, please visit our webpage here.
In recent news, the RBA interest rates has now risen to 1.85% from 1.35%, highest it has been since 1994. In response to RBA’s rise, Commonwealth Bank, ANZ and Westpac have also raised their variable home loan rates.
“CBA’s basic variable rate will hit a three-year high of 3.79% – a huge increase from three months ago when it was just 2.19%”
The Guardian
This would most definitely deter investors from investing in property at this time as obtaining finance is now more expensive.
Impact on the property market
It is expected that the market is bound to crack under the pressure of high interest rates. Therein, would cause house prices to fall.
CBA predicts property price growth rate to slow down in 2022 and prices to ultimately fall in 2023. Thus, investors may choose to hold off on property investments for the time being and await the fall in prices.
