Unpacking the new financial rules of commercial real estate investing

In this episode of The Property Nerds, co-hosts Arjun Paliwal, founder and CEO of InvestorKit, and Jack Fouracre, partnership manager, and Chris Huxter, head of commercial property at Fouracre Financial, discuss the evolving landscape of commercial finance in Australia. The trio dives into the rapidly evolving commercial finance landscape in Australia, highlighting the influx of non-bank and third-tier lenders entering the space. The growing competition has pushed loan-to-value ratios (LVRs) higher, with some lenders now offering up to 80 per cent LVR – even though SMSFs have been making commercial property more accessible to everyday investors. They then discuss how SMSFs are gaining traction as a vehicle for commercial investment due to tax advantages and long-term control, advising that buyers should have at least $550,000 in funds and a clear strategy. To avoid costly mistakes, they stress the importance of open communication with brokers and lenders, and emphasise that investors who understand LVRs, asset types, and SMSF structures are best positioned to take advantage of the expanding opportunities in commercial real estate.