Property the increasing choice of SMSF: SPAA

With demand for self-managed super funds growing, it’s interesting to note that it is the younger generations exhibiting significant growth, even as the older generations slice a bigger piece of the pie. It’s also property that is attracting the growth of interest.

A new report, commissioned by the SMSF Professionals’ Association of Australia and Russell Investing points to the 41 to 50 age group to be the area that continues to be the largest source of demand, cited by three quarters of financial planners.

This is followed by 31 to 40 year olds.

“It is this younger demographic that has exhibited strong growth over the past three years. They are interested in the longer term and have a good understanding of the short-term issues versus the longer term opportunity,” notes the report.

Andrea Slattery, from SPAA, said that despite the propoportion of superannuants looking to establish an SMSF in the next five years dropping to 12.3% from 17.3%, there are still high intentions over the longer term.

Despite this overall decline, it appears residential investment is the golden child of those with their assets placed in property. The report said that an expected movement out of cash did not occur, but did see a slight fall. In equities, a slight decline was also seen.

However, residential investment saw a 5.6% rise in 2012, to 9.9% in 2013.

The report was developed by CoreData and interviewed 1,267 Australian consumers, of which 385 were SMSF trustees. This is the fourth consecutive report.

This article first appeared on Property Observer.