I noted yesterday how calls were growing louder to allow first home buyers (FHBs) to use their superannuation savings to purchase property.
This has arisen following the release last week of Treasury’s Retirement Income Review, which found that home owners enjoy superior retirement outcomes than non-home owners.
The proposal has moved one step closer to becoming reality with the Senate cross-bench giving its tick of approval:
One Nation leader Pauline Hanson, Centre Alliance’s Stirling Griff and independent senator Rex Patrick said on Tuesday they would be open to changes to the super system to help renters enter the property market by accessing their retirement savings early.
A growing number of Coalition MPs are urging cabinet to prioritise home ownership over super savings…
The crossbenchers’ comments indicate the government could have enough support in the Senate to achieve changes to the retirement system…
A spokesman for independent senator Jacqui Lambie said she did not yet have a position. One Nation’s Malcolm Roberts did not respond to a request for comment.
Allowing an individual FHB to access their super to purchase a home would increase their chances of home ownership, since they would have a leg-up on other buyers.
But if you allow all FHBs access to their super, this advantage diminishes, since the increased demand would bid-up prices. The end result would be no ‘affordability’ gains and the downside of having less funds available in retirement.
Again, do we really want to pour more fuel on the housing affordability dumpster fire?