Can I Use My Super To Buy A House?

Can I Use My Super To Buy A House?

Are you a first-home buyer? If yes, there is good news for you. Being a first home buyer, you could be eligible to use the First Home Super Saver (FHSS) Scheme to save for a house deposit using your super. Basically, you can access superannuation when you retire. However, you can also use it to buy your first home using the First Home Super Saver Scheme. Before using your superannuation to buy a home, you need to make a contribution to your mandatory super. Now, let’s have a closer look at this scheme.

Can You Use Superannuation to Buy a House?

The short answer is ‘Yes’. There are various ways you can use your superannuation to buy a house, however, for this, you need to meet certain conditions. You can’t directly withdraw the super you have saved to buy your first home (unless you are retired and have reached the set age – the age at which you are eligible to start withdrawing super). Basically, there are three ways to use your super to buy your house:

  • Use the federal government’s First Home Super Saver Scheme to save a deposit for your first home through extra super contributions.
  • By setting up an SMSF and using that money to purchase an investment property.
  • If you qualify to use your super (currently 60 and retired or 65 and still working), you can use it for whatever you want.

Understanding the First Home Super Saver Scheme

Australians have the opportunity to save a deposit for their first home by using the First Home Super Saver Scheme (FHSS). With this scheme, you need to deposit an additional amount to your mandatory super deposit. It makes you able to withdraw a maximum of $15,000 in a financial year and a maximum of $50,000 all years towards purchasing your first home. To use your super as a first home deposit, you need to meet certain conditions:

  • 18 years of age
  • you must never have bought a home or investment property in Australia
  • you haven’t tried to use super previously for a first home deposit (this condition may change with changes that may occur from September 15, 2024)
  • you are likely to live in the home for a minimum of 6 months in the first 12 months of buying the house
  • you contribute to your super

Self-Managed Super Fund to Purchase an Investment Property

Australians have a choice to use their super purchase as an investment property, but it must be an investment property. If you have an SMSF, a fund that can have between 1 and 4 members, then you and other members can decide how your super is invested, including purchasing an investment property. Setting up an SMSF is a smart choice and you can seek help from Star Homeloans in Australia to understand the responsibilities and get an SMSF loan.

Buy a House with Your Super After Reaching Preservation Age

You can use your super for any reason after reaching your preservation age, i.e. 60 and retired, or if you turn 65 despite you are still working. It means you can take it all or some of your super to use to purchase a house or pay off a home loan or whatever you want. You can speak to expert brokers at Star Homeloans as there can be tax implications associated with super.

Why Use a Mortgage Broker for an SMSF Loan?

Getting an SMSF loan can be a complex process, and you can’t have direct access to lenders. Therefore, it is suggested to work with professionals who are experts in SMSF loans, just like Star Homeloans. We can help you in preparing an application that increases your chances of loan approval.

Conclusion

Now that you have an idea of how you can use your super to buy a house or an investment property along with certain conditions that you need to meet to access your super. Moreover, if you want to secure an SMSF loan, then you can speak to one of the expert mortgage brokers at Star Homeloans.

Other Useful Link:

Personal Loan Broker Sydney

First Home Buyers Grant Melbourne