If SMSFs wish to borrow to purchase a new properties, the process is fairly straight forward for most apartments and townhouses – purchase is via a deposit with the balance paid when construction is completed.
However, for house and land, the process is usually different, with most builders preferring the purchaser to buy the land and pay for the construction in instalments. Banks provide Construction Loans for this purpose, but will not provide them to SMSFs. For SMSFs to purchase a new house & land, a builder is required that will themselves purchase the land and fund the construction cost from their capital – Compass has a access to a range of builders that can provide will do this – i.e. the property is purchased with a deposit and no further payment until completion.