I have personally been researching the pros and cons of purchasing property in a SMSF. My investigations have shown it is certainly a much regulated process, with any mistakes costing you dearly with the Tax office.
Speaking for myself, I would certainly look for a property that has the following elements;
Needing very little maintenance and no renovations
Able to be leased from settlement date and be an attractive rental for a wide market
Be located in a proven capital growth area
Be able to recoup any outlays if your ‘Exit Strategy’ has to be brought forward
Be under the purchase price of $350,000
My reasoning is; any funds for maintenance OR renovations must come from the Superfund and not the loan on the property (ie borrowed money). Any rental income shortfall for loan repayments must be met by the superfund -so you don’t want the property vacant for any length of time. Capital Growth is where you make your money, especially as I would be planning to hold the property for over 10 years. If the worst case scenario happened and I need to sell the property and ‘cash up’ the superfund – I would rather have property priced around $350,000 as it is attractive to a wider market in that price range.