Using Super to Buy a House in 2026: FHSS, SMSF Rules and Preservation Age

Using Super to Buy a House in 2026: FHSS, SMSF Rules and Preservation Age

Yes, you can use super to buy a house, but only in three situations, and one of them changed on 10 August 2026. First home buyers can release voluntary super contributions through the First Home Super Saver scheme. A self-managed super fund (SMSF) can buy property with its own money, but a new SMSF loan can no longer be used to buy an ordinary residential property. And from age 60, once you retire, or from 65 whether you retire or not, your super is yours to withdraw and spend, including on a home.

The three routes suit three different people. Which one applies to you comes down to two questions: have you ever owned property in Australia, and how old are you?

One scope note before the detail. As mortgage brokers we arrange the loan side of a purchase. Whether to put money into super, or take it out, is a question for a licensed financial adviser. Moneysmart explains who is allowed to give that advice.

Can you use super to buy a house?

Super is preserved. The law locks it away until you meet a condition of release, and the ATO sets out the conditions of release. Early access is limited to a short list: the First Home Super Saver scheme, severe financial hardship, compassionate grounds, medical and incapacity grounds, and a few others. Wanting a house deposit is not on that list on its own. That is why the first route below works on voluntary contributions only, never on the compulsory super your employer pays.

Route 1: The First Home Super Saver scheme

The First Home Super Saver scheme (FHSS) lets you put extra money into your existing super fund, then withdraw it later for a first home deposit. The point is tax. Voluntary concessional contributions, such as salary sacrifice, are taxed at 15% inside super, which for most workers is less than the tax on the same money taken as salary. When you withdraw, the ATO also applies a 30% tax offset to the assessable part of the released amount.

The limits are firm:

• $15,000 of voluntary contributions counted in any one financial year
• $50,000 of voluntary contributions counted in total, across all years
• You can release 100% of after-tax (non-concessional) contributions, 85% of before-tax (concessional) contributions, plus “associated earnings”

Those associated earnings are not what your fund actually earned. The ATO calculates them at a set rate, its shortfall interest charge rate, as the FHSS release amounts page explains. Your real investment returns stay in the fund.

Eligibility is assessed person by person. A couple can each use the scheme on the same property, and if one of you has owned property before, that does not stop the other from applying. Our complete FHSS guide goes through the contribution types, the tax arithmetic and the hardship exception in detail. The short version follows.

Who can use the FHSS scheme

The ATO’s eligibility rules require all of the following:

• You are 18 or older when you request a determination. Contributions made before you turned 18 can still count.
• You have never owned property in Australia. That includes an investment property, vacant land, commercial property and a lease of land. If you lost a property through financial hardship, the ATO may still let you use the scheme.
• Your name will be on the title.
• You have never completed an FHSS release before. You get one go at it.
• You will live in the property as soon as practicable and for at least 6 of the first 12 months. You cannot use it for vacant land on its own, a houseboat or a motor home, though building a home on land you do not yet own does qualify.

You do not need to be an Australian citizen or a resident for tax purposes.

The FHSS process, step by step

1. Make voluntary contributions through salary sacrifice, personal contributions you claim a deduction for, or after-tax contributions. Your employer’s compulsory super does not count, and neither do spouse contributions or government co-contributions. A $25,000 salary sacrifice in one year still only counts $15,000.
2. Request an FHSS determination through ATO online services in myGov. The ATO tells you your maximum release amount. You must request it before ownership of any property transfers to you, which normally means before settlement. You can request a new determination later if you add more contributions.
3. Request the release. You can do this before you sign a contract, or within 90 days after signing, provided your determination was made on or after 15 September 2024. Ask for the full amount you want in one go, because you only get one release request.
4. Wait for the money. The ATO says it usually takes 15 to 20 business days for the fund to release the amount and for the ATO to pay you, after withholding tax. Build that into any finance clause or settlement date.
5. Sign a contract within 12 months of the release request, and notify the ATO within 90 days of signing. The ATO will generally allow a further 12 months, to 24 in total, without you applying.
6. If you do not buy, you must either put the assessable amount, less the tax the ATO withheld, back into super as an after-tax contribution, or keep the money and pay FHSS tax of 20% of the assessable released amount. The ATO sets out the timeframes and the recontribution rule.

Two FHSS traps we see

The first is the one-shot rule. A buyer we worked with had planned their whole deposit around a $60,000 FHSS withdrawal, only to find a prior release had already used their entitlement. We restructured the deposit from cash savings instead. Before you build a deposit plan on the FHSS, confirm with the ATO that nobody on the title has released under it before.

The second is timing. Fifteen to twenty business days is four weeks, and the assessable part of the release counts in your income for the year you request it, so it can also change your tax return. If you salary sacrifice and you have a HELP or other study loan, those contributions are reportable and count towards your repayment income for that year. Plan the release date with your tax agent, not just your conveyancer.

The FHSS is separate from the other first home buyer concessions. The ATO confirms that using a state concession does not affect your access to the FHSS, and suggests checking with the state body that the reverse holds too. It can also sit alongside the Australian Government 5% Deposit Scheme, which removes lenders mortgage insurance on a 5% deposit. If the FHSS release only covers part of what you need, our guide to how much deposit you need shows where the rest usually comes from.

Route 2: Buying property through an SMSF without borrowing

A self-managed super fund can own property, and it always could. The fund buys the property, the fund owns it, and the rent and any capital gain belong to the fund, not to you. The money stays inside super until a member meets a condition of release.

The rules that catch people out have not changed. Under the SMSF investment restrictions, a property held by the fund must pass the sole purpose test of providing retirement benefits. No fund member or related party, which includes your relatives, can live in it or rent it. The fund cannot buy a residential property from a member or a related party at all. In-house assets, such as anything leased to a related party, are capped at 5% of the fund’s total assets. Business real property is the exception to both of those rules: your fund can buy your business premises from you at market value and lease them back to your business at a market rent.

“I’ll buy it in the fund now and move in when I retire” does not work while the property is in the fund. Moneysmart’s SMSFs and property page also sets out the costs: a fund that holds property can face higher ongoing accounting, audit and advice costs than you would pay holding the same property in your own name.

What changed on 10 August 2026

Until August, a fund that could not pay cash could borrow through a limited recourse borrowing arrangement (LRBA) to buy a residential rental. Schedule 5 of the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 changed that from 10 August 2026. The ATO’s changes to limited recourse borrowing arrangements page puts it plainly: an LRBA entered into on or after that date to buy real property can only be used to buy business real property, whoever the lender is. Loans already in place, refinancing them, and purchases under a contract the fund exchanged before 10 August all carry on.

So an SMSF can still buy a residential property, but only with money it already has. If your fund has an existing SMSF loan, or you run a business and want the fund to buy your premises, read our guide to SMSF property loans after 10 August 2026. It covers the law, refinancing and commercial property, and it is where we handle every SMSF lending question.

Route 3: Accessing your super from age 60

Your preservation age is the age at which you can access super once you retire. For anyone born on or after 1 July 1964 it is 60. Older cohorts had a preservation age between 55 and 59, and all of them have now passed it. The ATO’s when you can withdraw your super page lists the full table.

Reaching 60 is not enough on its own. You also need a condition of release:

• You reach 60 and retire. Your fund has to be satisfied you have stopped working and do not intend to work again, or that you ceased a job after turning 60.
• You turn 65. From 65 you can take your super whether you are working or not, and there are no cashing restrictions.
• You reach 60 and keep working. You can start a transition to retirement income stream, but that pays an income, not a lump sum, so it will not fund a purchase.

Once you have met a condition of release, the money you withdraw is no longer super. Moneysmart notes that withdrawals from age 60 or 65 are usually not taxed, with some exceptions the ATO sets out. There is no sole purpose test and no restriction on what you buy. Plenty of our clients at this stage are downsizing, relocating closer to family, or buying the home they will retire in.

Three things to weigh before you do it:

• A home you live in produces no income, and every dollar you take out of super is a dollar not funding retirement. Decisions about your super can also affect your Age Pension eligibility. That is adviser territory.
• You can still borrow after 60. Lenders will want to see how the loan gets repaid, usually a short written exit strategy. In our experience it is arithmetic rather than strategy: the loan balance at your planned retirement age, set against your remaining super, or the net proceeds of a planned downsize. Superannuation statements are usually all it takes.
• Timing matters if you are between 60 and 65 and still working. A loan written while you are earning is assessed on your income; one written after you retire is assessed on your super and investments.

Which route fits you

How we help

For a first home buyer, our job starts where the ATO’s ends. We check what the FHSS release will cover, pair it with the 5% Deposit Scheme where you qualify, and structure the first home buyer loan around the deposit you actually have on the day. We also time the loan approval around the ATO’s release window so your finance clause does not expire waiting for it.

For an SMSF, we arrange refinances of existing loans and new loans for business premises, and we are straight with trustees who want to borrow for a residential rental: that door closed on 10 August 2026. For buyers over 60 we write the exit strategy that lenders ask for and find the lender whose policy on retirement-age borrowers fits.

Ready to work out which route applies to you? Talk to a mortgage broker at Mortgage World Australia. We compare 52+ lenders, and appointments are by phone or video.

Frequently asked questions

Can I use my super to buy a house before retirement?

To buy a home to live in, only through the First Home Super Saver scheme, and only with voluntary contributions you made yourself. You can release up to $50,000 of those contributions per person, plus associated earnings, towards your first home. Your employer’s compulsory contributions stay preserved until you meet a condition of release, such as retiring at 60 or turning 65. An SMSF can buy property before then, but the fund owns it and you cannot live in it.

Can I use my super for a house deposit in Australia?

Yes, if you are a first home buyer. Contribute up to $15,000 a year in voluntary contributions, up to $50,000 in total, then ask the ATO for a determination and a release. The released amount goes into your deposit alongside your savings, a gift or the 5% Deposit Scheme.

Can I still get $10,000 out of my super?

No. There is no general early-release scheme in operation. The ATO only allows early access on limited grounds, such as severe financial hardship, compassionate grounds and medical incapacity, plus the First Home Super Saver scheme for voluntary contributions. Wanting a deposit is not a ground on its own.

Can an SMSF still borrow to buy a house?

Generally no. Since 10 August 2026 a new SMSF loan over real property can only be used to buy business real property, so an ordinary house or unit no longer qualifies. Loans taken out before that date continue and can be refinanced, and a contract the fund exchanged before 10 August 2026 is unaffected. The fund can still buy a residential property with its own money if it meets the other SMSF rules.

Can I live in a property my SMSF buys?

No. A property held by your SMSF cannot be lived in or rented by any fund member or related party, including relatives, while it is in the fund. Once you meet a condition of release and the property leaves the fund, the position changes, but that is a transaction with its own tax and compliance consequences and needs advice first.

At what age can I use my super to buy a house?

From 60 if you have retired, or from 65 whether you are working or not. Preservation age is 60 for anyone born on or after 1 July 1964. Before that, the only route to a home of your own is the First Home Super Saver scheme for first home buyers; an SMSF can buy property earlier, but as a fund investment you cannot live in.

Patrick O’Brien, Director and Mortgage Broker since 2001.

This article contains general information only and does not constitute financial advice. Your personal financial situation, objectives and needs have not been considered. Before acting on any information, you should consider its appropriateness to your circumstances. Speak to a qualified mortgage broker for advice tailored to your situation. Superannuation and tax rules change; the Australian Taxation Office (ato.gov.au) is the authoritative source and the rules above were checked on 30 October 2026. Mortgage World Australia Pty Ltd is a credit representative (CR No. 396946) of Mortgage Specialists Pty Ltd (Australian Credit Licence No. 387025).

Patrick O'Brien

Patrick is a Director and a Home Loan Specialist. He has been helping Australians with home loans since 2001. Prior to working as a mortgage broker Patrick was employed by Macquarie Bank for 3 years and also worked as an accountant for a publicly listed company. Patrick’s qualifications include:

Bachelor of Business, UTS Sydney. Majored in accounting and sub-majored in Finance and Marketing.
Diploma of Finance and Mortgage Broking Management FNS50310
Certificate IV in Financial Services (Finance/Mortgage Broking) FNS40804