What happened
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 banned self-managed super funds from entering new Limited Recourse Borrowing Arrangements for residential property starting 10 August. A survey by Money.com.au showed 26 per cent of SMSF investors now plan to target commercial real estate where borrowing remains permitted, while 12 per cent intend to buy residential property outright with cash.
Why it matters here
This legislative change forces a structural reallocation of superannuation capital away from residential housing and into commercial premises. Commercial real estate often offers SMSF trustees higher rental yields and debt paydown capacity, but brings heightened exposure to tenant default and longer vacancy periods. Investors must navigate different risk profiles when expanding into commercial holdings.
What to watch
Capital flow metrics, commercial loan origination volumes, and yield spreads across industrial and office real estate sub-sectors as trustees reallocate fund assets over the coming quarters.
Source
brokernews.com.au