Superannuation compounds, but a leveraged asset compounds faster.
Both grow. Only one grows on an asset several times the size of what you put in. Run your own numbers and watch the two lines separate, year by year.
See how much faster the leveraged asset compounds.
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Commercial property versus super.
Adjust the numbers below and watch commercial property compound against sitting in super, year by year.
The property is purchased inside your SMSF. Ongoing contributions pay down the loan, accelerating as the balance shrinks.
Up to $0 at full borrowing capacity.
Total position over time
Net income comparison
Year one · Super
Year one · Property
Illustrative only. Not financial, credit or tax advice. Assumes 12% superannuation guarantee, a $30,000 concessional cap per member, 15% contributions tax and a 7% loan interest rate, with super fund growth and commercial property growth set by the sliders above. Borrowing capacity is eight times year-one contributions plus rent, solved jointly with the purchase price and acquisition costs. The property sits inside the SMSF: net contributions and net rental cashflow pay down the loan each year, and once repaid, surplus cash compounds at the super fund growth rate alongside the fund, and is assumed to pay the same dividend yield used for the super-only comparison. Actual returns, caps, costs and lending terms vary. Speak to a licensed adviser before acting.
Why the two lines separate
Super compounds on what you put in. A leveraged asset compounds on all of it.
Put $60,000 into super and roughly $51,000 lands after contributions tax, then grows. Put the same $60,000 toward a geared commercial purchase and the growth rate applies to the whole property, while the rent and your contributions clear the debt underneath it. That is the entire difference, and the simulator lets you pressure test it against your own numbers.
A bigger percentage does not always win.
What matters is what it compounds on.
11% on capped, taxed contributions can still lose to 6% on an asset several times the size. Set the sliders against yourself, put super on 11% and property on 6%, and watch where the lines cross.
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What the model actually does
Three engines, running at the same time.
This is not a growth rate typed into a compound interest formula. It solves the purchase, then runs the loan down year by year using the two cash sources your fund actually has.
Capped and taxed on the way in
Concessional contributions are capped at $30,000 per member and taxed at 15% before they land. Your growth rate only ever applies to what survives that. There is no borrowing, so the base can only grow as fast as you can fund it.
Growth on money you did not put in
An SMSF can borrow against commercial property. Your deposit controls an asset several times its size, and the growth rate applies to all of it. The debt is a fixed claim; the asset is not.
And then the loan disappears.
Once the balance hits zero, the interest bill goes with it. Every dollar of rent becomes net income, and the contributions that were paying down debt start compounding as surplus instead. That is the inflection the second chart is showing you.
Inside the simulator
What You Can Test
What your fund can actually borrow
Borrowing capacity solves off eight times your contributions plus the rent the property itself produces, against your balance net of stamp duty and acquisition costs. Change the yield and watch the achievable price move with it.
The year the debt clears
Net rent plus net contributions go at the loan every year. The dotted marker on the first chart is the year the balance hits zero, and it moves the moment you change any input.
Income, not just balance
A balance is not a retirement. The second chart compares a 3% dividend yield on the super balance against net rent after interest, and flags the year the property side clears $100,000 a year.
Where property loses
Push super growth to 20% and property to 1%, or set a yield that will not cover the interest. It will show you a negative cashflow year one and a loan that never clears. The model is not rigged to win.
Every assumption, printed
Guarantee rate, caps, contributions tax, interest rate, dividend yield and the borrowing multiple are all stated under the simulator. No black box, so you can disagree with any of them and change the ones that are sliders.
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Who built it
We built this to argue with ourselves.
Every input is yours to move, including the ones that make property look worse. We would rather you stress test it now than find the flaw after settlement.
Nikhil Sreedhar
Ahijith Chandra
Handle Properties is a residential and commercial buyer's agency transacting more than $10M of property every month across Australia. Between us we hold nineteen properties worth around $16 million, every one bought while we were still working full time. We are buyers agents, not financial advisers, and this simulator is a modelling tool rather than a recommendation to do anything with your superannuation.
140+ families served
Do not take our word for any of it.
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See how much faster.
Starting balance, salary, members, yield, growth and horizon. Forty years of both paths, side by side, with every assumption on the page.
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Handle Properties is a licensed buyers agency. We are not financial advisers, credit advisers, tax agents or superannuation advisers. This simulator is a general modelling tool only. It does not take account of your objectives, financial situation or needs, and nothing on this page is a recommendation to establish a self managed super fund, to move money out of an existing fund, or to buy, sell or hold any property or financial product.
All outputs are illustrative projections, not promises. They assume a 12% superannuation guarantee, a $30,000 concessional cap per member, 15% contributions tax, a 7% loan interest rate, 3% salary growth and a 3% dividend yield, with super and property growth set by the sliders. Borrowing capacity uses a general rule of thumb of eight times contributions plus rent. Contribution caps, tax rates, lending criteria, yields and growth rates change over time and vary by individual circumstance. The model assumes full occupancy and does not model vacancy, capital gains tax, SMSF establishment or running costs, or transaction costs on exit.
SMSF borrowing is a complex area with significant compliance obligations and personal consequences for trustees. Past performance is not a guide to future performance and property values can fall as well as rise. Before acting on anything here, speak with a licensed financial adviser, your accountant and your broker.
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