Allowing first home buyers to tap their superannuation would eventually push up house prices in the long-term, but only after the RBA’s interest rate rises cut property prices by at least 10 per cent.
Allowing first home buyers to tap their superannuation will eventually push up house prices, but only after interest rate rises cut property prices by at least 10 per cent.The housing policies of both major parties will increase property prices.If legislated, the policy would begin in July 2023, when money markets are betting the Reserve Bank of Australia would have raised the cash rate to 3.2 per cent.
As a rough rule of thumb, first home buyers could typically access about $30,000 from super to beef up their deposit, or $60,000 for a couple. Labor’s policy of 40 per cent government equity for 10,000 first home buyers earning up to $90,000 would also push up prices, though the tighter means test means the price inflation would probably be less than the Coalition’s plan.
Labor’s housing policy includes the establishment of a National Housing Supply and Affordability Council, including targets for land supply in consultation with the states and more transparency around the release of land. Home owner retirees avoid the relatively large expense of rent and have the potential to tap into the equity of their home to supplement retirement income.Contrary to the industry’s spin, increasing super does very little to reduce pressure on the aged pension. Super tax breaks for the wealthy outweigh the minimal government savings on the pension.Hence, prioritising superannuation for retirement ahead of home ownership and other working-life expenses may be putting the cart before the horse.
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