Should first home buyers access superannuation to pay for a house deposit?
Article by Rebeccah Elley
Independent Senator for South Australia, Nick Xenophon thinks so, stating he will introduce legislative changes to parliament urging for first home buyers to be able to access super to pay for a house deposit.
The idea is inspired by a scheme that ran successfully in Canada, dubbed Home Buyers’ Plan, which allows first home buyers to redraw up to $25,000 from a “registered retirement savings plan” for a first home deposit but the amount has to be paid back into the super fund within 15 years.
Xenophon said Australians are finding it difficult to break into home ownership and adopting the Canadian scheme would make a difference to many thousands of Australians each year. “There’s something strange about being able to access your super fund if you are about to default on your housing loan, but you can’t access it to put a deposit on a home in the first place.”
Mozo advises first home buyers to create a budget and a clear savings plan to build up your first home deposit - you can try Mozo’s savings goal calculator here. If you’ve already saved the required deposit, make sure you compare the home loan market to find the right mortgage with the features you need.
The Housing Industry Association said the idea warranted close consideration, as superannuation contributions are designed to support Aussies in retirement and owning a home delivers the same result, but with the added benefits arising from homeownership.
HIA’s media director Graham Wolfe explained many young people are “busy working, renting, repaying their education costs and in many instances, raising a family and saving for a deposit at the same time is a significant challenge.”
“By enabling access to a portion of their superannuation savings, many aspirational first home buyers would be able to accumulate a deposit, secure home ownership sooner and redirect their rental payments to their own future financial security,” Wolfe added.