Unlisted property trusts: Why would you bother?

The number of unlisted property funds not allowing investors to get their money out has raised questions about the unique risks of unlisted assets.

In our market, the biggest cloud over the sector, so far, is the redemption refusals popping up at major unlisted property funds. Picture: NCA Newswire /Gaye Gerard

The fashion for alternative unlisted investments is getting a reality check as investors can now get a risk-free cash rate of more than four per cent.

In our market, the biggest cloud over the sector, so far, is the redemption refusals popping up at major unlisted property funds.

So what does it mean for investors? In today’s episode of The Money Puzzle we look at the big problem with unlisted assets – you can’t always get your money out when you want to.

Also, we hear continually about how leading investors – including big super funds – make above average returns from alternative unlisted assets – but what is the real price of low liquidity?

My guest today on the podcast is a former property trust analyst who won’t put clients into unlisted trusts. He tells us why.

Who is the guest

Tim Mackay of the Quantum Financial group.

Why him?

Mackay is a veteran of The Australian’s Top Financial Advisers list and a former property analyst.

What are the topics?

• Getting your money out: The big fat problem with unlisted assets

• Do I face CGT on asset sales in retirement?

• How to optimise super concessional contributions

• The dreaded US withholding rate for Aussie investors.

Question of the week

Regular reader Marty asks: “I’ve heard it mentioned on the podcast that one way to offset realised capital gains from an investment property is to put some of the gains into super as

concessional contributions for the past five years. Is this a direct offset in your tax

return, or really just an indirect offset as the future gains on this money will be

taxed in the super environment?”

Questions always welcome to the podcast, via [e-mail]