If I downsize my house, how will that affect my super?

I’ve heard that a great way to build wealth is to put my super fund in repo mode and then put the withdrawals back into the fund. Apparently, this will increase the cumulative effect. I’m 62, have over a million dollars in my fund, own my own home, and have $500,000 in savings outside of super. I earn about $15,000 a year for a part-time job. My wife is in a similar situation. Is this a good strategy?

To access your retirement pension between the ages of 60 and 65, you will have to satisfy what is called a release condition. This involves retiring from a job – it doesn’t have to be your main job. Provided you have done so, you can make tax-free withdrawals at your leisure and you can convert your fund to pension mode. Remember that you cannot contribute to a pension fund – so the re-contribution you mention will have to be paid into a separate capitalization account. This will not affect the total balance of your superannuation.


My wife and I are about to move permanently to our vacation home in the countryside and make it our main place of residence. We have owned it for 10 years, during which time it has appreciated in value, and expect to pay capital gains tax up to that point when we sell in the future. We were told that for Capital Gains Tax (CGT) purposes, we would need to obtain a sworn appraisal of the property at the time we make this change. Do we need to engage a registered appraiser for this or can we use the capital improvement value as shown on our recently received council rate notice? I tried unsuccessfully to find an answer to this question on the Australian Taxation Office website.

Julia Hartman of Bantacs says the base price is only reset to market value if it was your home first and then used to produce income. In this case, there is no need for expertise because the calculation of the CGT will simply distribute the capital gain in proportion to the days covered by your main residence exemption and the days not.

The advantage, if you will, is that if it is still covered by your principal residence exemption when you die, your heirs will inherit it at market value on the date of your death. If that happened, there would be no CGT.

  • The advice given in this article is of a general nature and is not intended to influence readers’ decisions regarding investments or financial products. Before making financial decisions, they should always seek their own professional advice that takes into account their personal circumstances.

Noel Whittaker is the author of Simplified retirement and many other personal finance books. Email: [email protected]

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