Invest
APRA slams ‘super for housing’ plan
Allowing first home buyers to tap into their superannuation for a deposit would result in a considerable property price spike, an industry regulator has warned.
APRA slams ‘super for housing’ plan
Allowing first home buyers to tap into their superannuation for a deposit would result in a considerable property price spike, an industry regulator has warned.
During an economics committee meeting, Australian Prudential Regulation Authority chairman Wayne Byres admitted that using superannuation for a home deposit would drive up housing prices.
With CoreLogic figures showing February was the strongest month for growth since 2003, and the continued low interest rate environment and HomeBuilder stimulus packages forecasted to further drive prices north, Liberal backbenchers have floated the possibility of enabling first home buyers to tap into their super for a deposit.
But the APRA chief is not convinced. Instead, Mr Byres expressed his hesitation to the House of Representatives economics committee on Monday.
“We are obviously in the current environment keen to avoid things that lead to further escalation in housing prices,” Mr Byres said.
“You would have to think it would add to the demand. All else equal it is likely to push them up,” he added.
Mr Byres followed a statement by the standing committee chair Tim Wilson, who has said that people should have the choice to use their superannuation as they see fit, including as a helping hand when saving for a deposit.
Mr Wilson, who has been a vocal critic of the superannuation system, recently launched a campaign called “home first, super second,” with the idea to allow members to use their super to buy property.
“I always believe that home ownership is actually in Australian’s best interests. Some people may think having superannuation balances is more important than that. As a public policy principle, the greatest leading indicator of poverty in retirement is not owning your own home… I make absolutely no apology: I am for home ownership,” Mr Wilson previously told the media.
“I believe what people should have in their superannuation is choice. Choice to contribute more if they believe it’s important, choice that if they don’t have their own home – a critical part of financial security – that they have the choice, and that’s all I believe in. I don’t want to tell anybody how to live their lives at all – that’s why I’m a Liberal,” Mr Wilson said.
Former prime minister Mr Turnbull labelled the plan “crazy”, arguing that it would simply enable further price growth.
“The proposition that super contributions should either not be increased or should be able to be accessed to be put into the housing market is surely one of the craziest ideas I’ve heard,” Mr Turnbull said.
“I resisted efforts to do this when I was prime minister... but we have a housing affordability issue here in Australia, and there is a bunch of reasons for that, but diverting even more savings into housing is simply going to bid up the price of housing.”
Despite the booming house prices, the prudential regulator said it does not target house prices, but will instead pay close attention to the quality of credit.
“It’s not our job to solve house prices, and it’s not our job to solve house pricing affordability. The extent to which there is dynamic emerging of increased risk taking by the community,” Mr Byres concluded.
About the author
About the author
Property
Property prices boosted by housing policies: RBA
The central bank has outlined the “pervasive” impact that policy has on property. ...Read more
Property
Labor’s ‘Help to Buy’ scheme not without its risks
With Anthony Albanese sworn in as Australia’s 31st PM, home buyers are excited at the prospect of accessing the new ‘Help to Buy’ scheme, but a property expert has warned that the risks may be g...Read more
Property
Australia's housing market is entering a ‘broad-based correction phase’
Westpac believes the housing market downturn is now underway. ...Read more
Property
ANZ now expects house prices will end the year lower
With higher interest rates on the horizon, the bank is forecasting larger house price declines than previously expected. ...Read more
Property
Which capital cities are most attractive to property investors?
A new survey has suggested that investor attention is shifting away from Australia’s two largest capital cities. ...Read more
Property
Market uncertainty fails to discourage foreign property investors
While interest from foreign investors in Australian property has remained strong, HLB Mann Judd warned that tax increases could see demand shift to other markets. ...Read more
Property
Regional renters forced to spend more of their income than ever before
Renters in regional areas are spending nearly as much on rent as home owners are spending on mortgage repayments. ...Read more
Property
Aussie home buyers now need to save for over 11 years for a deposit
Since early 2020, the time needed to save for a deposit has increased by more than two years. ...Read more
Wrapping up an eventful 2021
Listen now
What Omicron means for property, and are units right for first-time buyers? What is equity crowdfunding? Are industry super funds tapping into member funds to save their skins?
Listen now
Will housing affordability improve in 2022? Will buy now, pay later become the norm? Why are Aussies staying in failing super products?
Listen now
Who really benefits from crypto ETFs? How will the RBA respond to rising inflation? Could a mandate help address unpaid super?
Listen now
Property
Property prices boosted by housing policies: RBA
The central bank has outlined the “pervasive” impact that policy has on property. ...Read more
Property
Labor’s ‘Help to Buy’ scheme not without its risks
With Anthony Albanese sworn in as Australia’s 31st PM, home buyers are excited at the prospect of accessing the new ‘Help to Buy’ scheme, but a property expert has warned that the risks may be g...Read more
Property
Australia's housing market is entering a ‘broad-based correction phase’
Westpac believes the housing market downturn is now underway. ...Read more
Property
ANZ now expects house prices will end the year lower
With higher interest rates on the horizon, the bank is forecasting larger house price declines than previously expected. ...Read more
Property
Which capital cities are most attractive to property investors?
A new survey has suggested that investor attention is shifting away from Australia’s two largest capital cities. ...Read more
Property
Market uncertainty fails to discourage foreign property investors
While interest from foreign investors in Australian property has remained strong, HLB Mann Judd warned that tax increases could see demand shift to other markets. ...Read more
Property
Regional renters forced to spend more of their income than ever before
Renters in regional areas are spending nearly as much on rent as home owners are spending on mortgage repayments. ...Read more
Property
Aussie home buyers now need to save for over 11 years for a deposit
Since early 2020, the time needed to save for a deposit has increased by more than two years. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
