Investing your superannuation in direct property could now be an option in your retirement strategy, thanks to recent changes to the laws governing self-managed superannuation funds.

The changes provide an opportunity for a self-managed super fund (SMSF) to borrow money to acquire a beneficial interest in an asset, i.e., property. Trustees can now set up their own private instalment warrant arrangements to borrow a portion of the property purchase price and combine this with their existing superannuation to make the property purchase.

The underlying security is held by an entity other than the investor, but as the investor you are able to enjoy the income and capital growth of owning that security. When you eventually pay your final instalment, you will acquire outright ownership - hence have legal title to your property.

Prior to this reform, property could be purchased within a super fund but it usually had to be bought outright as the fund was not allowed to borrow a portion of the total cost. For this reason, many self-managed super funds have up until now primarily invested in the share market or indirectly invested in property via property funds or trusts.

Apart from giving you the opportunity to invest more money than you could if you had to rely solely on your own resources, the new laws bring with them tax benefits. When holding a property as part of your super fund, the earnings arising from your investment are taxed at the superannuation fund rate, compared to the personal tax rate you would pay if you owned the property outright. If the property is sold once the fund has moved into its pension phase, you are exempt from paying Capital Gains Tax.

In addition, incorporating property in your super fund gives you the opportunity to diversify your assets, providing you with a fall-back if your other investments are off the pace.

As its name suggests, a self-managed super fund may give you greater control of your super destiny, but its complex rules can be daunting to the uninitiated. Expert advice is necessary and will help facilitate a smooth set-up, as well as ensure any borrowing and investment falls within the rules of the fund.

It is expected the new opportunity to borrow will entice more people away from employee or industry funds in favour of setting up a self-managed super fund. If you are considering this as an option, I am happy to provide information and referrals to help get you started.

Your home might be worth more than you think it is. That's the message from a recent survey of property owners, which revealed that many of us are unsure if our home has increased or decreased in value.

The MFAA/BankWest Home Finance Index revealed that NSW and Western Australian survey respondents were the least informed, with 22.2 % and 10.6 % respectively not knowing the value of their homes.

Having your property valued is an important first step in taking advantage of the equity in your home. It's a common misconception that property appraisals are needed only if you are planning to sell, when in fact you can use them annually to refinance additional investments.

If an appraisal finds your home has increased in value, for example, you can use this equity to negotiate a larger loan. On an increase of $60,000 you could apply to borrow another $50,000 (around 80% of the value), which you can put towards purchasing another investment property. In fact, the additional equity in your home can be used as a wealth creation strategy in any number of ways. Please feel free to discuss these options with me.

For the best indication of price on your home, use a qualified valuer so that you can be sure of the level of accuracy. This can be arranged privately by yourself or completed as part of any refinancing arrangement. Real estate agents can give an estimate of price but their appraisal does not have the kind of detail that lenders require when making a decision on a loan. A mortgage lender will almost always require their own valuation to be completed as part of the loan application process.

A professional appraisal report provides a comprehensive overview of your property as well as an evaluation of the real estate market in your area. I can recommend and arrange for a valuer to come to your home, or you can organise a valuer independently through the Australian Valuers Institute (www.valuersinstitute.com.au).

The main factors that influence a valuation are property market trends and the size and location of your property, but it doesn't hurt to lend a helping hand. To get the best possible valuation on the day, valuers recommend that your property is neat and tidy. If you have minor home improvements to make or already in progress, get them done before the valuer pays a visit!

You wouldn't go shopping without a credit card limit, so why go house hunting without being certain of how much you can afford to borrow?

Home loan pre-approval will stop you from falling in love with a property and then finding out it is financially out of reach. It gives you the ability to know your limit and the peace of mind to be able to put in an offer. Whether you are buying your first home, looking to upsize or hunting for an investment property, having a pre-approval in your hand will empower your bargaining position.

Although a pre-approval is no more than a statement of opinion by the lender of your mortgage-carrying capacity, it does strengthen your negotiating position with the seller as it demonstrates you are serious about the property.

The pre-approval process involves an assessment of your income, assets and credit. It is a short-term agreement that provides you with a loan limit subject to the valuation of the property. It doesn't take the place of a home loan approval since the price of the house is preliminary and your mortgage-carrying capacity depends on an interest rate that is not yet known.

If your offer on a home is accepted and you already have pre-approval you won't have to wait around long to close the deal. The entire processing procedure can be speeded up as you have already accomplished this first step in securing a home loan. This extra time may be critical to a successful deal if your contract has a cooling off period.