SMSF property exposure remains steady

An industry survey has revealed SMSF portfolio allocation to the property sector increased only slightly from 19 per cent to 19.5 per cent in the March quarter.

The SuperConcepts “SMSF Investment Patterns Survey March 2018” found direct property exposure rose from 13.9 per cent in the previous quarter to 16.2 per cent.

Meanwhile, listed property dropped from 1.7 per cent to 1.6 per cent and managed fund allocations were unchanged at 1.1 per cent.

Other property categories, including syndicates and unlisted trusts, decreased from 2.3 per cent in the December quarter to 0.6 per cent in the March quarter.

The survey also found even though the Australian real estate investment trust (AREIT) performance in the sector was -7.26 per cent for the quarter, as 83 per cent of the property allocation for SMSFs in the survey was represented by direct commercial or residential property, the AREIT performance had little impact on the allocation.

In actual numbers, the around 2600 SMSFs covered in the report own a total of 966 residential or commercial properties.

The split between commercial property and residential property was 43 per cent versus 57 per cent.

Further, the average value per property was $690,000 for commercial property and $413,000 for residential property.

The survey covers about 2600 funds, a sample of SMSFs administered by SuperConcepts, and their investments held at 31 March. The assets of the funds surveyed represent about $3.1 billion.

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