SMSFs are required to value their assets at market value. Depending on the situation, a market valuation may be undertaken by a:

  • Registered valuer
  • Professional valuation service provider
  • Member of a recognised professional valuation body, or
  • A person without formal valuation qualifications but who has specific experience or knowledge in a particular area.

For real property, the valuation may be undertaken by anyone as long it is based on objective and supportable data.  A valuation undertaken by a property valuation service provider, including online services or a real estate agent is acceptable.

However, where the value of the asset represents a significant proportion of the fund’s value – or where the nature of the asset indicates that the valuation is likely to be complex – you should consider the use of a qualified independent valuer.

In general, real estate does not necessarily need a formal valuation each year by a licenced valuer unless there is a significant event that occurs during the year which may affect the previous valuation. A significant event could be one that directly involves the property itself, the fund on a general level such as one of the fund’s members going into pension mode, or if the asset represents a significant portion of the fund’s value.