Hockey contemplates first home buyer access to superBY LAURA MILLAN | MONDAY, 9 MAR 2015 12:10PMThe superannuation industry has reacted strongly to Treasurer Joe Hockey's comments that suggest the government could allow young Australians access to their superannuation to buy their first home. Related News |
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Singapore's "superannuation" system has been set up with three purposes: 1. to save for retirement; 2. to pay for medicals and doctor visits; and 3. provide deposit for first home. Housing affordability is also a challenge in Singapore and hence their version of "Superannuation" is to help alliviate this problem. Perhaps we could look into this model to see where we could learn and apply? In addition we should look at why our housing market is so inflated? Could it be due to the leniency we allow foreign investors/buyers??
Me thinks that this could be the precursor to including the principal place of residence in the Centrelink Asset Test.
Hockey's suggestion that a person's super could be used to partly fund homeownership is a poor idea, particularly when comparisons with Singapore are included in the argument.
Singaporeans save more than Australians through compulsory saving with 2 separate accounts. One is for retirement purposes and the other can be accessed for non-retirement purposes, such as health, education and housing.
Australians need to save more and stop looking for unfunded taxpayer handouts.
I never in a million years thought I would ever agree with David Whiteley on any issue regarding Superannuation, however, here I am doing just that. This is very dangerous ground and I believe the concept is flawed.
What about the government look toward a re-structure of Stamp Duty costs for first home buyers in addition to a dramatic reduction in Real Estate agents commissions for sales relating specifically to first home buyers in order to reduce up front costs in obtaining the first home?
Can you imagine the impact on house prices if, literally overnight, the 5 million Australians adults who don't yet own a home suddenly have access to a deposit to purchase their first home. Property in some price segments would go up 40% in the first 12 months alone.
It would sure win a lot of votes with young people though. Clearly Hockey is long on real estate, short on the superannuation industry.
It should be noted that the contribution rates to super are 37% in Singapore. 20% employee, 17% employer....I am sure that wouldn't popular with voters (or business) if we went down that path.