An SMSF can borrow money to buy investments but the rules are complex and very strict on how this should be set up. It is generally advisable to engage a financial adviser or legal professional to help with setting up these arrangements.
To summarise the rules:
Please note: Repayments from limited recourse borrowing arrangement will cause a credit to your super transfer balance account. These credits increase your transfer balance account and reduce your available personal cap space. The credit will arise where the payment results in an increase in the value of your superannuation interest that supports your superannuation income stream that is in the retirement phase Importantly, this applies in relation to a limited recourse borrowing arrangement that arises under a contract entered into on or after 1 July 2017. Furthermore, refinancing a pre-1 July 2017 limited recourse loan may also remain exempt from this change if certain criteria are met.