Can I use my super to buy a house?

Most Australians can't use super to buy a house. The only exceptions are investors purchasing investment properties through an SMSF, or first home buyers using the First Home Super Saver Scheme.

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Using money in your super to buy a house is not really possible in Australia. You can't just pull your superannuation out of your fund and use it as a deposit. However, using the First Home Super Saver Scheme, eligible first home buyers can pull out some of their voluntary extra super contributions to use for a deposit (but not their compulsory super payments). There are tax benefits for doing this.

And property investors with self-managed super funds can buy properties through their funds. But only for investment purposes.

The First Home Super Saver scheme explained

In 2017 the federal government announced a new scheme to help first home buyers get a deposit together for a property purchase. The scheme came into law on 1 July 2018 and applies to voluntary super contributions made since July 2017.

First home buyers can access up to $15,000 in super contributions per year up to $30,000 in total per person. A couple buying a house could therefore use up to $60,000 in voluntary superannuation contributions saved over two years. The biggest benefit of the scheme is that you can earn a higher rate of return on money in a super fund (compared to a savings account) while paying lower tax on the funds (just 15%) while lowering your pre-tax income if you salary sacrifice.

Read finder's full guide to the First Home Super Saver scheme

Buying a home through an SMSF

You can buy an investment property through your self-managed super fund (SMSF) but you can’t use your super balance to buy a home you're going to live in.

This is because superannuation is designed to fund your retirement, not to help you fund the essential purchases you make throughout your life. The purchase of an investment property is allowed because it gives you the potential to earn rental income and also take advantage of a capital gain when you sell the property, thereby increasing your retirement savings.

Compare SMSF loans to buy investment properties

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

loans.com.au SMSF P&IInvestment≥ 20% Deposit

loans.com.au SMSF
3.69%
3.70%
  • App: $0
  • Ongoing: $0 p.a.
$691
Refinance your existing SMSF loan to this competitive variable rate investment loan. Refinancers only.

Liberty Financial SMSF P&IIOInvestment≥ 40% Deposit

Liberty Financial SMSF
4.35%
4.79%
  • App: $495
  • Ongoing: $30 per month
$748
A self-managed super fund loan from Liberty Financial. Available with a 20% deposit.

Freedom Lend Variable SMSF IOInvestment≥ 30% Deposit

Freedom Lend Variable SMSF
4.19%
4.83%
  • App: $1,645
  • Ongoing: $395 p.a.
$734
A flexible SMSF home loan with interest-only repayments. 100% offset account attached.
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Compare up to 4 providers

Accessing your super before you retire

There are strict rules in place to prevent Australians accessing their superannuation balance before they retire. These rules are designed to ensure that Australians have enough money to enjoy a comfortable lifestyle once they stop working.

In order to access your super before your retirement you’ll need to satisfy a condition of release. Some common examples that might allow you to access your super early are if you suffer a serious illness or disability, or if you are experiencing extreme financial hardship (including receiving Commonwealth income support payments).

Using super for a deposit on a house is not a condition of release.

But it’s not all bad news. If you’ve reached the preservation age, which is 55 years for Australians born before July 1960, and at least 56 for people born after June 1960, the rules surrounding early access to your super aren’t quite as strict.

If you fit this category and you want to access your super benefits to put down a deposit on a house, there are two options you can consider to help you get the funds you need:

  • Retire. If you’ve reached your preservation age and you retire, you can withdraw your super benefits. However, you should be aware that you may need to pay tax on any super benefits you withdraw before reaching 60 years of age.
  • Set up a transition to retirement (TTR) pension. This option is designed to allow Australians who have reached their preservation age to keep working while also accessing some of their super benefits – you can withdraw between 4% and 10% of your pension account balance each year.

There is a range of financial and taxation implications to consider if you choose either of these approaches, so ask your accountant for their expert advice.

Want to find out more about super? Check out our super funds guide

Insights in the Finder app

Want to give your savings a boost?

The Finder app hunts down personalised ways for you to save. You could save on your bills, mobile plan, credit card, insurance and more. Pop in your phone number below to get your download link.

If I can't use my super to get a house deposit what are my options?

If none of the options above work for you here are some other tips you can put into practice. These include:

  • Look for other ways to save a deposit yourself. Check out our complete guide to deposit savings for more information.
  • Guarantor loan. If your parents own their own property and are willing to help out they could guarantee a portion of your deposit. It's not without risks but it's a great option for some buyers.
  • The first home loan deposit scheme. This new scheme involves the government guaranteeing 15% of your deposit, helping you avoid lenders mortgage insurance costs.

Download the Finder app to get more out of your money

Compare your mortgage options now

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

UBank UHomeLoan Fixed P&IHome 1Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
1.79%
2.32%
  • App: $0
  • Ongoing: $0 p.a.
$540
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees.

Westpac Fixed Option Home Loan Premier Advantage Package P&IHome 2Y Fixed≥ 5% Deposit

Westpac Fixed Option Home Loan Premier Advantage Package
1.99%
3.48%
  • App: $0
  • Ongoing: $395 p.a.
$555
$3,000 refinance cashback
Lock in a low fixed rate for 2 years that allows you to make up to $30,000 in extra repayments and buy your home with a 5% deposit. $3,000 cashback for eligible refinancers. Apply by 30 September 2021. Terms and conditions apply.

Nano Variable Home Loans P&IHome≥ 25% Deposit Refi Only

Nano Variable Home Loans
1.99%
1.99%
  • App: $0
  • Ongoing: $0 p.a.
$555
Switch to this competitive variable rate with zero fees. Requires a 25% deposit.