The Australian reports that the Council of Financial Regulators (CoFR) recommended in February that the federal government impose a ban on property investment through self-managed superannuation funds (SMSFs), but its recommendation was ignored by Treasurer Josh Frydenberg. The CoFR’s call came after 18,000 SMSFs were found to have over 90% of their savings in a single asset class, primarily investment properties:
Regulators urged the government in February to ban property investment through self-managed funds, after the amount of LRBAs [limited-recourse borrowing arrangements] held by the sector rose to $40 billion, a 10-fold increase from the $400 million figure a decade ago.
Ahead of the May 18 election, Josh Frydenberg snubbed a recommendation from the Council of Financial Regulators — which includes the Reserve Bank, Australian Prudential Regulation Authority, Treasury and Australian Securities & Investments Commission — over concerns about LRBAs threatening the savings of individual retirees and the wider financial system.
