Industry body warns using super for housing could have negative effects on prices
Using superannuation for house deposits could increase rents for tenants over time, new research from the Super Members Council (SMC) has shown.
A Coalition policy allowing the use of super for deposits is projected to cause a 9% price spike for a median property, which would likely result in higher private rents, SMC said.
The Super Members Council’s analysis suggests that if these price increases are fully passed on, median rents could rise by nearly $3,000 annually, or about $57 per week, with various data sources and studies indicating that long-term rents tend to move in tandem with property prices.
Thus, according to SMC, utilising super for deposits would lead to a spike in property prices, thereby exerting upward pressure on rents.
Misha Schubert (pictured above), chief executive of Super Members Council, said allowing first-home buyers to access $50,000 from super for a deposit would not increase homeownership rates and would leave people financially worse off. She renewed calls to drop the policy and advocated for bipartisan support to preserve super for retirement.
“A couple withdrawing their super early for a house deposit is projected to be $165,000 worse off over their lives,” Schubert said. “That’s because rents, mortgage repayments, stamp duties, and rates would all rise – and people would lose a significant amount from their super at retirement.”
Schubert added that superannuation delivers dignity in retirement for millions of Australians, reduces fiscal pressure on the pension system, and powers Australian businesses. She stressed that the success of super relies on policy foundations such as preservation, universality, and compulsion and that undermining these foundations could harm all Australians and reverse the gains made by super in savings, living standards, and the budget.
“Australia has built a transformative policy miracle in super – it is the envy of the world,” she said. “Both major parties of government have contributed to super’s success – and both of them have a duty to safeguard it.”
Schubert also revealed new data indicating that profit-to-member super funds are set to inject nearly $200 billion into Australian businesses and infrastructure over the next five years, with a typical 30-year-old today expected to retire with $500,000 in super.
With the nation’s savings pool growing to $3.9 trillion, there is increasing temptation for policymakers to use super to address other policy problems. Using super for house deposits is one such idea, but SMC warns against it.
“We’re now seeing super’s potential to transform the economic fortunes of our nation,” Schubert said. “All of us have a responsibility to nurture Australians’ super, grow it, and strengthen it for future generations.”
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