Super for housing will cause rents to soar: SMC

New research from the Super Members Council (SMC) has revealed using superannuation for house deposits could, over time, increase rental prices.

SMC said the Coalition's plan to use super for house deposits is projected to cause a 9% spike in the median property price, with that rise expected to flow through to private rents with an increase of around $57 per week, or $3000 a year.

SMC research also found a typical couple who withdraws super early to buy a home would have $165,000 less in disposable income after housing costs over their lifetimes - due to the twin effects of higher housing costs and having less super to live on in retirement.

SMC chief executive Misha Schubert called for the policy to be dropped and for strong bipartisanship on the preservation of 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 mountain of money from their super at retirement.

"It would make life harder financially for young Australians - especially those renting - and make cost-of-living pressures worse."

Speaking at the Committee for Economic Development of Australia (CEDA), Schubert said the purpose of super was to deliver dignity in retirement, lifting incomes for retirees, reducing fiscal pressure on the pension, and powering Australian businesses.

But the success of super is built on the policy foundations of preservation, universality, and compulsion, she said.

"Australia has built a transformative policy miracle in super. It is the envy of the world," Schubert said.

"Both major parties of government have contributed to super's success - and both of them have a duty to safeguard it.

"Strong and enduring bipartisanship on the fundamentals of super is essential to ensure millions of Australian retirees have enough income to live on.

"We urge Australia's business leaders to speak up on the importance of safeguarding Australians' savings for retirement - to avert risks to the incomes of retirees, of fiscal damage, higher taxes, and a weaker capital base for Australia's economy."