Self-managed superannuation funds have disregarded the pandemic crisis and ploughed back into property using borrowed money, according to the latest figures from the ATO.
In 2020, SMSF owners’ Australian residential property holdings increased 7.5 per cent, to $39.1 billion, on the back of an 8.8 per cent jump in their total non-recourse borrowings to $50.23 billion.
Owners appear undaunted by the market routs, with cash deposits in SMSF’s actually falling 1.3 per cent, to $156.28 billion, despite their Australian share holdings slumping 12.1 per cent.
That means owners didn’t dump shares for cash, but rather seemed to have backed property to tide them through.
The increase in residential property investment is not necessarily a bad thing for home buyers, according to Nicki Hutley, partner with Deloitte Access Economics.
“If SMSFs invest in new housing, that wouldn’t necessarily push up prices for owner occupiers,” she said.
“If SMSFs went out of the market, it might result in less demand for new housing which would reduce new construction.”