Research from ASFA found that using super for a house deposit would be “inequitable and ineffective” as it would primarily used by higher income earners, while the increased purchasing power would be “near fully capitalised into higher house prices”.
“Australia already has some of the most expensive housing in the world. With the prevailing macro-economic conditions and surging demand for housing, using super for housing deposits would be disastrous and push prices even further out of reach of first-time buyers,” said ASFA chief executive Dr Martin Fahy.
“Superannuation isn’t the reason young Australians can’t afford to buy a home of their own. A lack of supply, and the policy settings with respect to residential investment property has had a distortionary effect on demand. These are the real issues that must be tackled to generate improvements in housing affordability.”
ASFA called for the Morrison government to launch a “comprehensive and independent review” of housing affordability, similar to the Retirement Income Review, to drive consistent policy outcomes across federal, state, and local governments.
“Using superannuation for housing deposits is fundamentally inconsistent with the objective of superannuation to provide an adequate retirement income. None of the comprehensive reviews of superannuation over the last decade have recommended it, while several have made recommendations to the contrary,” Mr Fahy said.
The idea of allowing access to super for a house deposit has been championed in recent times by Liberal MP Tim Wilson despite opposition from other members of the Morrison government, including superannuation minister Jane Hume. Former prime minister Malcolm Turnbull also criticised the idea in a recent appearance with Industry Super Australia chair Greg Combet.
“There are some other really poor arguments being advanced – some of these arguments are being advanced by former colleagues of mine for whom I have respect and affection, but that doesn’t mean they’re always right,” Mr Turnbull said.
“The proposition that super contributions should either not be increased or be able to be accessed to put into the housing market is surely one of the craziest ideas out there. I resisted efforts to do this when I was Prime Minister.”
