FSC raises concerns about government’s Super Home Buyer Scheme
The Financial Services Council has raised concerns about prime minister Scott Morrison’s plans to allow access to superannuation for first home buyers to fund a deposit.
The move could undermine the purpose of the superannuation system and could force up to 5.3 million young Australians to decide between owning a home or their retirement savings, the FSC says.
Prime Minister Scott Morrison used the Liberal Party's election campaign launch in Brisbane yesterday to unveil a super home buyer scheme.
Under the Super Home Buyer Scheme, first home buyers will be able to invest up to 40 per cent of their superannuation, up to a maximum of $50,000 to help with the purchase of their first home.
The scheme will apply to both new and existing homes with the invested amount to be returned to their superannuation fund when the house is sold, including a share of any capital gain.
“The FSC is concerned the government’s proposal weakens the sole purpose of superannuation, which is to provide higher standards of living in retirement,” says FSC CEO Blake Briggs.
The FSC recognises there is a correlation between renting in retirement and poverty amongst older Australians, but Australians should not have to choose between a home and their retirement savings.
“The government’s own majority report into ‘Housing Affordability and Supply in Australia’ concluded that superannuation should only ever be used for housing if there were commensurate measures to increase supply,” says Briggs.
“The government’s supply measure only extends downsizing to 1.3 million households, whilst potentially allowing approximately 5.3 million under 35-year-old Australians that do not yet own a home access their superannuation to buy a first home.
“The government has an obligation to do more to boost supply, otherwise unleashing superannuation savings on the housing market risks driving prices higher still.”