Peter Dutton’s plan to let first home buyers pull up to $50,000 out of their superannuation savings to access the property market would only push up house prices and erode retirement balances, experts said.
The Opposition Leader reaffirmed the Coalition’s policy on super for housing in his budget-in-reply speech this week, but stopped short of increasing the limit, as recommended by a Senate committee headed by Liberal Andrew Bragg. Its report said borrowers should be able to drain their entire super balance to buy property.
Under Mr Dutton’s policy, first home buyers would be able to tap up to 40 per cent of their super to a maximum of $50,000 to use for a home deposit. If the home is sold, the withdrawn amount would have to be repaid into super.
Dylan Jones would consider accessing his super if he could. Peter Rae
Economists Richard Holden, professor of economics at the University of NSW, and Westpac’s chief economist Luci Ellis said demand-side subsidies had historically only resulted in higher values.
“There’s good economic data that shows that things like first home owner grants drive up the prices by almost the exact equivalent amount,” said Professor Holden.
