ASFA against using super for home deposits
Letting first home buyers access their superannuation to pay their home deposits is not the way to solve housing affordability issues, according to a super body.
The Association of Superannuation Funds of Australia (ASFA) warned against letting home buyers access their super for a deposit, saying housing affordability needs to be solved through policy measures.
It suggested release of land, rezoning, decreasing stamp duty, and funding of assisted housing.
"Policies that merely increase the capacity of individuals to pay for housing often have the effect of driving up housing prices, eroding any positive impact on housing affordability," it said.
The body also said the move would compromise on retirement standards, arguing even compulsory contribution rates of 12 per cent would not be enough to fund a comfortable retirement.
It gave the example of Singapore, where contribution rates are 36 per cent (20 per cent employer contributions, 16 per cent employee contributions) under its Central Provident Fund.
ASFA is also worried using super for a home deposit could lead to an inequitable super system, where those on higher incomes can replace any amount taken out for a deposit through salary sacrifice and get a tax concession.
AUTHOR
Malavika Santhebennur
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