Straight Equity on Settlement Day (SMSF Purchase)

This client has been a long-time follower of PFA and an experienced investor who had already completed a few property purchases independently. Over the years, he had built a good foundation but like many self-directed investors, he made one costly mistake of purchasing a land and building it later that did not perform as expected. While the concept seemed strong at the time, the property didn’t experience much capital growth, and the returns were lower than projected.

When it came to purchasing a property under his SMSF, he wanted to get everything right. He knew that SMSF properties require a different level of planning, especially because of stricter lending conditions, higher interest rates and the need to balance yield and long-term growth to keep the fund cash flow positive.

Having followed our webinars, posts and market updates for a long time, he had already developed trust in our data-backed process and investor-first approach. Confident in our experience, he decided to skip the discovery session and signed up straight away.

Strategy & Search : During the initial briefing, we mapped out his financial position and identified key objectives:

•⁠ ⁠Achieve a strong, consistent rental yield to support SMSF cash flow

•⁠ ⁠⁠Target a growth location for long-term compounding returns

•⁠ ⁠⁠Keep borrowing within comfortable serviceability limits given SMSF lending costs

We shortlisted multiple suburbs across capital Melbourne, regional Victoria and regional Queensland.

After running detailed cash flow models at SMSF interest rates, it became clear that capital city properties, though stable, would not deliver the yield needed to support the fund without extra contributions. Regional locations, however, offered a better balance between income and growth.

The Property : After analysing several shortlisted options, we came across an off-market property that matched the brief perfectly. It offered solid fundamentals, a strong rent and was within a region showing upward movement in both demand and rental activity.

Key Details:

•⁠ Asking Price: $685,000 but it was negotiated hard and secured for $672,000 in Sept 2025

•⁠ ⁠Land Size: 936 sqm

•⁠ ⁠Build Year: 2018

•⁠ ⁠Rental Income: $630 per week (leased until Dec 2025)

•⁠ ⁠Gross Yield: 4.9%

•⁠ ⁠Valuation: aligned with the contract price

The Result:

Fast forward to settlement day (11th November 2025), CoreLogic’s valuation estimate for the property had already moved up to $710,000.

That’s an immediate equity gain of $38,000 right at settlement.

The Lesson:

This case highlights a few key takeaways for investors:

• SMSF purchases require precision. High interest rates, strict LVRs and contribution limits make it essential to plan cash flow carefully.
• ⁠Yield and growth must be balanced. A high-yield property with no growth or a growth-heavy property with poor yield can both strain an SMSF.
• ⁠Off-market doesn’t mean compromise. The right connections and research can uncover strong, under-the-radar opportunities.
• Experience pays off. Working with professionals helps avoid costly mistakes especially in structured investments like SMSF.

From trust to teamwork to tangible results, this purchase proves that with the right plan, investors can build equity from day one, even within the tighter lending environment of SMSFs.

PropXperts helps clients move from hesitation to confidence — identifying opportunities, managing risk, and delivering results that speak for themselves.

Disclaimer: SMSF is regulated and one should seek a financial advice as if this product suits them or not.