Buyers Agent Forum on SMSFs at REIV

By Janet Spencer

By Janet Spencer

Janet presented at the Buyers Agent Forum on SMSFs at the REIV on the 14th of August to a packed and very interested audience.  The topic for discussion was “The difference between investment advice and property marketing”and the source document for discussion was the ASIC report released in April 2013, entitled ” SMSF’s: Improving the quality of advice given to investors”.

MC was Jodie Sanders of the REIV and speakers included:
Kate Metz, Senior Manager with Australian Securities and Investments Commission ( ASIC),
Ben Kingsley, Chairperson of Property Investment Industry Association  and
Janet Spencer, REIV Buyers Agent Chapter Chairperson and specialist Buyers Agent.

Buyers Agent SMSF Forum

Over 140 attendees packed the REIV conference room and this topic was of obvious interest as it was a sell out event.

In 2012 ASIC reviewed over 100 files of SMSF  funds with a balance of less than $150,000 and all owning real property with the aim of developing practical tips for improving the quality of SMSF advice in future being provided by Financial Advisors and Accountants to their clients.  Kate was very knowledgeable on results of the study as the author of the ASIC report on the quality of advice being given to SMSF investors by “gatekeepers” or financial advisors and accountants.

ASIC recognize that “gatekeepers” have a critically important role to play ensuring :
a. that only those investors for whom and SMSF is suitable go into the sector, and
b. the ongoing viability of the SMSF sector is protected.

The research generally found that adequate advice was given to the majority of clients with only 1 of 132 files reviewed receiving good advice, and the average amount borrowed in SMSF was $350,000 and 98% of funds borrowed were to invest in real property.  

Buyers Agents have a huge role to play when investors are acquiring direct property in their SMSF.  Asset selection is vital.  Investors need the right type of property that will achieve capital growth and also rental income.  The property also needs to fit in the strict guidelines for property acquisition in an SMSF.  Alot of investors for example are not aware that they cannot use the property themselves at all and hence beach houses would not satisfy as suitable for ownership in an SMSF.  Investors should ensure that the Buyers Agent they select is an REIV member, has lots of experience buying investment property, is receiving their income only from the investor and no other source thus ensuring full independence.

For more up to date information on what’s happening in real estate in Melbourne, contact Janet at  jspencer@buyersolutions.com.au or 0418 101 146.

Buying property, Events/Presentations, Investment, Investment property, Superannuation

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