With housing affordability likely to be one of the major issues affecting many Robertson voters on May 21, both major parties have announced schemes to help first home buyers into the market, with mixed reactions.
Labor kicked the ball off by announcing its shared equity scheme.
The Help to Buy scheme would cut the cost of buying a house by up to 40 per cent, with eligible home buyers needing a minimum deposit of 2 per cent.
The Federal Government would make an equity contribution of up to a maximum of 40 per cent of the purchase price of a new home and up to a maximum of 30 per cent for an existing home.
Homebuyers would not be required to pay rent on the stake of the home held by the Federal Government and would have the option to buy back that stake when their finances improve.
Labor candidate for Robertson, Dr Gordon Reid, said many hopeful home buyers on the Central Coast are priced out of the market.
“Housing prices have gone up by 20 per cent nationally, but by over 40 per cent here on the Coast,” he said.
“This scheme is about getting people into homes sooner by cutting the amount they need and would be open to 10,000 people each year.
“It’s a proven method and is working in other states around Australia and in countries like the UK.”
The Liberal Party hit back early this week with a plan to allow home buyers to access their superannuation to help them secure a home.
Under the Super Home Buyer Scheme, first home buyers would be able to invest up to 40 per cent of their superannuation, to a maximum of $50,000, to help with the purchase of a home.
It would apply to both new and existing homes with the invested amount to be returned to the buyer’s superannuation fund when the house is sold, including a share of any capital gain.
Concerns over the Liberal plan have been raised by the Australian Institute of Superannuation Trustees (AIST), which claims it undermines the core purpose of the superannuation system.
“Accessing your super early won’t get you closer to your dream home or fix Australia’s housing crisis,” AIST CEO, Eve Scheerlick said.
“Using super as a deposit will drive up property prices, leaving Australians with higher debt and depleted retirement savings.”
Industry Super Australia Chief Executive, Bernie Dean, said the scheme would add tens of thousands of dollars to housing prices and undermine the retirement savings of all Australians.
“Any additional money Australians can take out of super via the scheme announced today would almost immediately be gobbled up through housing price surges,” Dean said.
“Throwing super into the housing market would be like throwing petrol on a bonfire – it will jack up prices, inflate young people’s mortgages and add to the aged pension, which taxpayers will have to pay for.”
But Master Builders Australia (MBA) says the policy will mean keeping the dream of homeownership within reach of Australians while maintaining the integrity of the superannuation system.
“The success of this policy is that it is aligned with the intent of superannuation which is to provide sufficient retirement income,” MBA CEO, Denita Wawn, said.
“People who own their home, particularly in retirement, are significantly more secure financially than those who do not; they enjoy a higher standard of living,” she said.
Incumbent Liberal Member for Robertson, Lucy Wicks, said the scheme would make the great Australian dream of owning your own home a reality for many.
She said it would give many Central Coast residents a “leg up” to enter the housing market.
Wicks stressed that under the scheme, buyers would continue to build their super savings while living in their own home.
“When you sell, the amount you invested is returned to your super, plus a share of any capital gain,” she said.
“Superannuation is there to help Australians in their retirement, and the Super Home Buyer Scheme will ensure Australians can use those savings they are responsibly building up to improve their quality of life now and standard of living in retirement.”
The Super Home Buyer Scheme would start by July 1, 2023 with no income or property caps and eligibility restricted to first homebuyers who must have separately saved five per cent of the deposit.
Reid said the Liberal plan was “short-sighted”.
“Super is designed so people would have financial support they could rely on in their retirement,” he said.
“If young people are raiding their super now they will be worse off in the future; it’s poor economic management and would make it more expensive for the county to support people in their retirement.”