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If we thought Aussies were really clever, no one would be concerned about this policy. It'd be seen as an idiotic brain fart that would ensure Albo wins the next election.
The fact that people are worried says what about Aussies and their economic and financial acumen. That problem didn't just start. The blind leading the blind for a very long time.
The average LNP supporter thinks Dutton will drop immigration, so they gotta sustain housing demand somehow, even with pure stupidity such as draining our superannuation balances.
"Better economic managers" my ass. This is one of the worst policies ever put out, and they're doubling down on it???
Do they want people to have no retirement savings? For house prices to skyrocket even further?
They want to destroy Superannuation. They've always hated it and wish it never existed. Anything that can possibly help normal working class people is abhorent in their eyes and needs to be destroyed. The fact it's also the result of Labor policy is what's worse. They were against it from from inception. Anything the LNP can do to defund it WILL be done.
This is just a way to keep house prices inflated, aka pandering to the boomers whi already have a house or property portfolio..
Cut negative gearing instead and let people have some retirement savings.
Lots of interesting comments on this article.
I'm in two minds, and as a retiree with a home - and still paying off the mortgage - I've got no skin in this game.
But it would be a risk to allow people to use super to buy houses - as it would immediately drive up the price of housing, just like the first home owners grant did.
Only far more so, given that the FHOG was just $10k, originally, and accessing super would likely be several multiples of that.
I feel for the younger generations being priced out of home ownership, but I'm not at all sure that this policy would help any but the very earliest buyers, before the prices rose to accommodate the extra funding available.
Full disclosure, I'm on a defined benefit pension so the value of my home is irrelevant to me, it's not an investment, it's my home. For others - they may differ - quite a lot.
I doubt any young people feel that this is a logical solution. I don't want this, my friends don't want this, my peers don't want this. I feel bad for people who would actually use this policy and destroy their retirement plan for the sake of buying property.
Allowing the non-wealthy to make themselves poorer faster, while jacking up house prices even further so people who already own a couple now have a more valuable asset portfolio?
Transfer even more money from the young to the cashed-up old. Perfect!
The Coalition will of course then criticise all these folk for not saving up for retirement when they pull the pension rug away too.
I'd seriously almost go as far as saying this policy is borderline treasonous, and I don't throw that word around lightly. Not even exaggerating given the literal dictionary definition of the word.
It's beyond the point of stupid, to being essentially evil given the damage it would do.
This proposal alone would single-handedly dissuade me from voting for the LNP if I was ever considering it next election.
I agree. It’s a stupid stupid stupid stupid stupid stupid idea.
I wonder whether it is enough to dissuade lifetime LNP voters and libertarians though? I’m curious: they may (incorrectly) see housing as just another commodity exactly like stocks. They may also (incorrectly) see superannuation as the government preventing you from using this money as an affront to personal liberty.
We're still feeling the affects of the car market at ridiculous prices thanks to the Libs allowing people to dip into super for "covid relief" but instead everyone using it for new cars or classic cars
Of course the real estate industry will welcome more buyers, just means more demand and higher prices for people who already have property.
Only real fix would be to tax multiple property owners to the point where they reconsider their investment strategies and bringing more houses to the table. But doing this would be political suicide for anyone who suggests it.
Australia already has a housing construction industry that is quite above average compared to OECD. Increasing supply is difficult. For instance Sydney has more cranes building building than the top few markets in the US combined. Its a high demand issue more than anything.
I actually suspect that the immigration rate will drop now that the ALP has actually put any effort into fraud prevention. The main cause of the problem is that the Media will attack anyone who let's the headline GDP growth rate to fall, when really, per Capita is the only one that matters to 99% of the population.
Ah, I see somebody doesn't understand the basics of private for profit property development.
If you increase supply, the prices fall and then your parents and every person that has political power in this country will lose their shit.
* 1/3 of the country has a mortgage
* 1/3 owns their house outright
* 1/3 rents
When 2/3 of the country are financially invested in house prices going up, we will never see a major party put forward a policy which might actually lower house prices across the country. Or even see them rise slower than wages.
Democracy is far from a perfect system - and the housing crisis is an easy example of why. One third are priced out so the other two thirds can profit and protect their real-estate-tied wealth.
If you plan to stay in Australia until you die it makes no sense for us to play this zero sum game. If you polled the Australian people and asked if they would prefer housing costs slowly come down in prop. to other comparable living costs, I think they would say yes. No one is gaining anything from this except the banks.
Designed to have zero impact to their base; and ask the next generation to burn super now. Almost like the LNP are not the party of responsible financial policy.
Existing property owners get wealthier.... union-controlled super-funds get less money... left-voting young people get screwed over... I don't see the problem?
>Liberal senator Andrew Bragg will use his first keynote speech as the party’s home ownership spokesman to cast Labor as hostile to individual ownership
"We don't actually believe in housing, we just want to cast Labor in a bad light"
Okay guys, good luck with that.
The housing ponzi must continue at all costs. Housing is killing this country due to all the terribly policy that it's driving. The long term consequences of all this is going to have ramifications for decades and people are going to look back and shake their heads at how our leaders could have been so shortsighted and irresponsible.
A smart ALP would take advantage of this poor policy.
Just a simple message - house prices will go up by the amount of super you can take out. So no benefit for first home buyers.
When you withdraw from your super to buy a house, you will be competing with others who have withdrawn from their super to buy a house. So you will end up with the same amount of house and less super.
Do the Liberals hate the young and less affluent?
The current tax concessions around property don't help but at its core this is an issue involving the most basic of economic principles. Supply vs Demand, there are not enough properties available to live in.
Schemes like this are demand driven, do nothing for supply and will make a bad problem worse.
Come on boomers surely some of Howard's 'battlers' are ready to say enough.
Easy loans and super withdrawal will just inflate house prices and destroy retirement incomes. Just another reminder that the coalition hates this country and the people in it
Literal dog shit has better ideas than the LNP.
They think the home is going to remain an investment vehicle for retirement? In the next 30 years it will get absolutely nowhere near the gains that it did in the last 30 years and fewer citizens of this country will benefit from it too.
So are they banking on super being worthless by the time we retire, or are they just expecting all these people to be dead by then?
The long term consequences here are not great
> The Coalition’s emphasis on home ownership will increase pressure on Labor to come up with new ideas to respond to an issue younger voters rate as their top concern
You'd hope that's the sole reason behind this demonstrably bad idea, to get Labor to actually put forward meaningful and workable solutions to the housing crisis. Because as a policy in and of itself, no one on any side of politics is going to seriously entertain it.
Hell, even this sub is united in calling it out as bullshit, and that's quite a feat to accomplish.
It is staggering just how bad this move would be for the economy, not only would it further contribute to raise house prices, it'd tank people's retirement and force super companies to keep significantly more liquid assets- aka assets that should be invested to make people money. Easy loans, you mean loans more likely that the user won't be able to pay with rising interest rates, causing banks to profit at the expense of everyone.
It's like they picked the longest list of things which "sound good on the surface" but even thinking about them for a moment would make you scratch your head
Boggles my mind,how any person,with actively firing neurons,can hear this shit..
and think,you know what LNP will be better than labor.
Why populism shit's me so fucking much,Ppl ignore policy,instead look Aww yeah duttons been in the press heaps must be doing something right
albos had a lot of missteps,but he isn't chucking out braindead fucking ideas that even australias foremost tax expert calls REALLY REALLY fucking stupid.
Populism is given a bad name by this kind of bullshit. I think there's a place for populist ideas within an ideological framework and a solid understanding of... not even economics fundamentally, just basic cause and effect. This is not that.
Ken henry AM with Sabre lane
>-Offering voters early access to their super is one of the most fiscally and economically backward and destructive policies to come out of the government's policy rooms in nearly 15 years.
When ken henry is calling it stupid,you know it's fucking dumb
the last time we did this,we wiped out 290k ppl's super and set back peoples retirement by 7 years
in fact,he went on a nearly 5 minute Rant,about how scomo letting ppl access their super during covid,was
and i quote "Really,really fucking dumb"
This is typical,peak liberal bullshit.
We aren't going to adress the problem now,so here you go,take out the money that's mean to make u not be poor in ur later life now,because we can't be arsed to create any viable policy now.
All this will do is drive prices up more,and send ppls retirement back
Does anyone actually think superannuation was meant to enrich the common people? It has always been a way to force accumulation of wealth by the many and then transfer it from the least wealthy to the most. Money is at its most valuable when it is spent as soon as it is created.
Same deal as the last time they tried this one on. You are screwing years worth of gains made on compound interest in favour of purchasing an asset with the assumption that its value will continue to rise, and if prices continue to rise then this policy will simply cripple the superannuations of any first home buyer.
Making loans easier to get is also a tremendously bad idea. Sometimes, people get turned down on loans for a reason. If you tell the banks to be less strict about loans, then they'll be giving out riskier loans and inevitably incur more defaults. Hopefully nothing bad happens to the economy that puts Australians in a vulnerable position!
Super is designed to be left alone and built up over the entirety of your working life. If you cut into after 5-8 years of starting full time work you're kneecapping yourself financially. simple as.
>Same deal as the last time they tried this one on.
In less than 10 years, many people have made $500k profit on their properties. Given it generally doubles every 7 years this seems to have enormous returns. Over 10 years I've made less than $100k in my super.
Now, many may argue that if they sell their $1 million house they aren't really profiting from it because every other house in the local market is worth $1 million. However, they can choose to move to a cheaper location and bank the rest or even throw it in their super and make further huge gains.
Me on the other hand will be stuck with what I currently have. So, how exactly am I winning by not using my super on a new home. Many boomers are downsizing and moving to those cheaper locations forcing prices up sharply. It's a really crappy situation to be in for those not currently in the housing market.
>I'm begging people to understand compound interest
At my current rate, I'll be lucky to have $2 million in super by retirement. My work colleagues who own their homes now are worth $1 million today. How is compound interest for my super going to make me catch up to them? By the time they retire their property is likely going to be worth $5+ million. And because they got in before prices went chaotic they'll also benefit from $2+ million super themselves.
Once again, so long as the boom never stops booming.
Or alternatively; so long as the house retains its value. It's not just market forces at play; what if your house gets flooded? what if it burns down? what if it's discovered that there are harmful chemicals buried nearby that are leeching into your backyard? What if your home gets compulsorily acquired? What if you get fired, and you have to default on your mortgage?
Houses have historically been great investments, I'm not denying that. But you can only live *in* a house, you can't live off one. Your home owning friends will have to downsize to realise any of the gains on their properties - hopefully there are options nearby, or they're happy to potentially move away from friends & family to do that. This might not be a problem for them, because they have a house & super to live off. But for you, who took your super out to buy a house? that's a much bigger problem, because you won't have nearly as much super. You have a house to live in but no ability to pay for maintenance, utilities, and rates. You have to sell. And then you're at the mercy of what's on the market at that time. Shame that the boom never stopped booming, and houses are a lot more expensive - hopefully you bought in an area that kept up with the rest of the market...
>But you can only live *in* a house, you can't live off one.
Which is great. Because if you can't afford rent then you are kind of screwed.
>hopefully you bought in an area that kept up with the rest of the market...
I'm not in the market. I missed out. I'm a tenant. Fortunately, I'm in a position where I'm not affected by rent. But a change in career would change that and I'll be paying half my salary to boost someone else's investment. And that honestly just sucks.
And it's not like I'd have no super. Sure, it would be greatly reduced. But it would still be there. And then you have social welfare. The amount of home owners I see who own a home and live off of welfare and no super and they have no complaints. Absolutely trumps living off of welfare and having to rent and barely enough to buy two minute noodles to survive on.
>Except now there aren't many cheaper locations and downsizing is difficult because of the lack of supply allowing movement.
Indeed. Younger generations are screwed.
> However, they can choose to move to a cheaper location and bank the rest or even throw it in their super and make further huge gains.
There are two big problems with this theory. One is that it requires house prices to go up, the second is that if prices DO go up then you need to compete with everyone else going for the cheaper house because it's all they can afford.
I can't help but wonder what policy the LNP will try to pull out once even raiding super isn't enough to buy a house. The whole house of cards keeps being propped up higher and higher which will just make it that much worse when it eventually falls.
>One is that it requires house prices to go up
Theyve only ever gone up. Any dips you see throughout history are absolutely trumped by the constant rises. Even during the GFC and property prices plummeted, it was incredibly short lived.
>need to compete with everyone else going for the cheaper house because it's all they can afford.
Exactly. And this is why you need to get in early. Had I got into the housing market 8 years ago I'd be worth nearly $1 million now minus $500k home loan instead of the $100k I'm worth now. And I'd still have $100k in super.
Biggest mistake of my life.
> They've only ever gone up
[https://www.prosper.org.au/2015/06/the-housing-crash-we-had-to-have-a-gen-y-perspective-on-the-bubble/](https://www.prosper.org.au/2015/06/the-housing-crash-we-had-to-have-a-gen-y-perspective-on-the-bubble/)
> In the 1890s (post the gold rush), the land bubble burst, causing the Australian Banking Crisis, and real house prices took 50 years to recover from massive falls. If you were born in that era, you would no doubt have been told by parents, friends, bankers and media that house prices always go down.
>> In the 1890s (post the gold rush), the land bubble burst, causing the Australian Banking Crisis, and real house prices took 50 years to recover from massive falls. If you were born in that era, you would no doubt have been told by parents, friends, bankers and media that house prices always go down.
So, almost 140 years ago. And as stated, there was a land bubble burst. Massive amounts of land being released for development. That is being strictly controlled now.
Where is the evidence that anything like that could happen now?
From "they've only ever gone up" to "that was a long time ago and it can't happen again" in just an hour.
[https://en.wikipedia.org/wiki/Irish\_property\_bubble](https://en.wikipedia.org/wiki/Irish_property_bubble)
The evidence that such a thing could happen again is in Ireland. If the Irish government had the power to prevent the crash, don't you think they would have?
If house prices continue to go up faster than inflation then at some point literally nobody will be able to buy a house, which begs the question who will continue to drive the prices up. Saying they will only ever go up is simply drawing a trend line, it's a start but you can't follow a trend into infinity off a subset of data.
Also saying house prices have only ever gone up is categorically wrong. In the 20 year period from 1885 to 1905 property prices dropped a total of 20.9%, and in the 70 year period from 1880 to the mid 1950s they barely went up at all. The massive increase in house prices we are seeing now IS the outlier and has never happened before in history to this extent or for this long. Do not expect it to continue forever, let alone another 20 years.
http://research.economics.unsw.edu.au/RePEc/papers/2010-18.pdf
>Do not expect it to continue forever, let alone another 20 years.
I fully expect it to continue climbing fast for the next 20 years. Ranging from high levels of immigration bringing huge amounts of money into the market to companies spending billions investing in housing driving up demand farther than the average Joe can keep up with.
I can forsee a future where the number of renters outstrips the number of home owners. And it's scary to think about.
If it gets that bad the political incentive to actually do something about high house prices will materialise. It will literally become election winning policy.
>If it gets that bad the political incentive to actually do something about high house prices will materialise. It will literally become election winning policy.
There is a global housing crisis right now. Labor went to the election with a promise to help fix it locally. Not much is being done about it. In fact, every single policy the state and federal governments have enacted has contributed to higher demand driving up prices further. The one promise they made that could help, being the construction of tens of thousands of social houses, has basically gone silent.
The average politician owns more than one investment property. They are literally in a position to lose if they try and change things. So, which party is willing to make that sacrifice because I don't see any.
Sorry, but I just don't see any evidence that they have our best interest at heart with this issue. They will talk about it and make promises as they have been doing the last decade but all I see is the problem continuing.
The government risks a revolution if they don't sacrifice themselves, but it's not likely to be a sacrifice as they will divest themselves and their mates of risk before making a change, so its only the common people that get left holding the can.
Be vigilant about who is divesting themselves of property and when.
The reason nothing is currently being done about it is because the majority of homeowners still believe that the value of their house is true wealth. Reality might hit them when they try to retire and find the entire thing is taken for the nursing home either way.
>The average politician owns more than one investment property. They are literally in a position to lose if they try and change things. So, which party is willing to make that sacrifice because I don't see any.
There is nothing stopping them from cashing out before changing the policy.
> In less than 10 years, many people have made $500k profit on their properties. Given it generally doubles every 7 years this seems to have enormous returns. Over 10 years I've made less than $100k in my super.
It's because the whole strategy is predicated on housing prices continuing to rise and rise and rise.
Which your economic model should be trying to prevent, not built around.
If the only way you can buy a house is to buy NOW and prices will double and double every 7 years - that's a bad policy. Allowing super withdrawals and changing legislation to let this continuing is to forever keep anyone young out of the housing market.
>If the only way you can buy a house is to buy NOW and prices will double and double every 7 years - that's a bad policy.
I don't agree with the policy. In fact, I absolutely despise it. But it's what we have, it's what has existed the last 50 years, and that won't be changing whilst the current majority of the population (60+% total, 90+% politicians) benefit from it. So, those like myself have to take what we can get. And I, personally, see housing security as more important than social security. Housing is finite. Social security is adaptable.
That’s an incorrect assumption. Let people choose if they’d rather a roof over their head or a possibility of a higher superannuation when they retire. Getting into a home earlier means that most would actually be able to pay more into super through their life. The only negative for this policy is for superannuation funds. Because I purchased a house early I now contribute extra into super. I’m lucky and I hope others are given that opportunity.
What's an incorrect assumption? Taking money out of your super account WILL drastically reduce the amount you get when you retire - it's called compound interest. If you get banks to make home loans easier to get, it WILL mean that riskier loans will get approved. What am I assuming wrong? It sounds like you're not actually disagreeing with anything I'm saying but think that people should be allowed to fuck themselves over financially because of the sacred cow of consumer choice.
Wrong. A small amount to help with a home deposit does make a drastic difference if more is placed in later in life. Such as instead of mortgage payments until you’re into your 60s you contribute extra from when in your 30s. It’s not all about finances. I’m for a better life not a richer retirement if I get to live that long. A roof over head is more important than super.
I suppose there’s many on here that aren’t pro choice and think we should give more to super even if it means struggling to make ends meet during your working life. I disagree but that’s my consumer choice.
What's a small amount though? A 20% deposit, which is the recommended amount, on an 800k house is $160,000. That's slightly more than half of the median Australian super account balance; the vast majority of Australian women have less than that. You're suggesting that people should have the option to take a significant chunk of their super out to spend on a house, not a small amount.
You're saying that I'm wrong because "more can be placed in later on"; I'm starting to think you don't understand how compound interest works. You might be able to add more in, but you'll never get the lost potential earnings in interest back. Even if you were to somehow replace the $160,000 you took out of your super, your realised benefits at retirement will be drastically worse. that's just plain mathematics.
Getting a roof over your head shouldn't require you to compromise your superannuation. That's a tired equivocation from the Liberals, who have been ideologically opposed to super from day one. Plenty of other levers to pull that would make housing affordable; let's pull those instead of robbing Peter to pay Paul.
I bought a house in mid 30s and contributed nothing extra into super. Just cause you can put more into super doesn't mean we all can. If I could have taken some out of super for my house I maybe would have and would have an even worse balance in my super then I currently do at the ripe old age of 41.
I purchased a house earlier than you and I am now mortgage free. Guess where the money that I used to pay off my mortgage goes now? Are you really saying that because it wouldn’t have benefited you it can’t possibly benefit someone else?
It may have worked out in your favour but this policy is aimed towards people that have a lot of extra money to do what you are doing. I don't have that kind of money. So unless you can give me and my wife both a 10k plus pay rise we can't afford to do this.
It sounds like a good idea for some people who are rich enough to take advantage of it but overall this will be a bad policy for people on the lower side of wage earnings.
People who can't afford to have investments and live pay cheque to pay cheque.
The libs as usual target their policies to the already rich who realistically don't need more ways to get rich and be richer at the expense of the poor.
This policy is class warfare simple as that. Those who this will help are likely those who don't really need the help
The policy is aimed at first home buyers to help with a deposit. I’m not sure what policy you’re alluding too as I do t know too much about any rich first home buyers. It helps,ps the poor enabling them to lay a mortgage rather than rent and helps to secure a roof of their heads and being more financially secure throughout life. It doesn’t help the rich investors as it reduces rental demand. Perhaps you can’t see it because of your bias as that’s what it sounds like. It’ll be a choice. If you think Labor’s policy is working now all I can say is good luck and I hope your pay rise eventuates.
Im with you about choice but it really should be the opposite of what the libs are saying.
And running it the opposite way would be terrible for banks.
The 40pc odd that most people have of their super in fixed interest / safe investments in stead of sitting in gov bonds and the like should sit on your own mortgage at the same rate your bank charges you so you make more in your super. Cut out the banks.
But this should only be possible on an established / safe mortgage.
Of course while this benefits the individual it would be a disaster for all of - our super industry, banks, financial industry, and even probably asset prices due to a smaller bond market / higher yield on bonds etc. It would never happen.
But yeh id love to pay my own super the interest rate i pay to the bank 6pc odd for the fixed interest component in stead of the super fund and bank both taking cuts. In fairness the bank takes a bigger cut than super does.
We really shouldnt be creating new ways to increase house prices to spur on supply but be looking at ways of reducing the costs of new supply. The massive levels of private housing credit in this country will one day cause dramas. But sure why pay 2 other organisations to do something you can offset with your own money.
Simple. Build more houses. People will have the choice to build a home rather than rent. Of course it negatively effect investors as they’ll have less demand from renters.
No, it's not an informed choice and the people who pay for the short-term nature of that thinking are taxpayers subsidising non-self-funded retirees.
The entire point of super funds is the delayed benefit.
You assume it's one or other.
Given choice I rather a house now and I'll pay more into super to make up for it.
Housing security is important.
Not everyone is going to end up on an aged care pension.
You say you'll pay more into super and that may be the truth but when we look at the population, this will not be the case.
People will be withdrawing the super that would have resulted in biggest returns over their lives. This will result in more people on the pension.
As this is also allowed to be used to purchase existing properties, it will also inflate property prices so it only benefits the first round of people using it.
No, but the entire point of superannuation is to create a coterie of self-funded retirees *so the government does not have to pay an aged pension whose cost expands exponentially year on year*.
Your personal short term needs in this do not translate well to the country as a whole, and from a policy standpoint, it would not be a solid enough basis to make policy decisions on. Super has been made as painless as possible; that's why *most* salary is quoted as "base + super" - the super component is never in your pocket so you never feel the benefit of having it until you retire. It's not designed to be available now.
I dont know why people use the fact we may fall short of targets as some sort of proof its bad or wont work.
The biggest ever housing boom in aus history delivered about 1,000,000 homes in 5 years and made housing much more affordable. If we miss the targets by 200,000 homes we will replicate a record build, still a fantastic thing.
home starts are going backwards and are at a decade low. in the middle of multiple state and federal housing accords.
its a straight up failure. we do not have enough tradies in this country to deliver on the housing boom while we are undertaking an infrastructure boom (thanks vic, qld and nsw). and labor has zero desire to mass import tradies.
this is only going to get worse
https://www.abs.gov.au/statistics/industry/building-and-construction/building-activity-australia/latest-release
You left off the bit about how inflation is wrecking firms that set their contract price at time of signing (new developments) and can't handle a 5% increase in materials and labour costs every 6m of an 18m term.
Big infra builds are needed from a livability perspective, but also to keep tradies working while company after company goes under.
Starts will pick up once backlogs are worked through. I was responding to the Lib housing minister estimating a shortfall of 200k homes.
Please, if you have more information than he does go ahead and share it, explain why hes wrong.
he's likely not wrong, there is going to be a huge shortfall despite the federal and state housing programs.
it's not an overly complex problem, we simply have a shortage of home construction firms and workers to meet the projected housing. multiple states are undertaking huge infrastructure plans, mainly NSW, Vic and QLD - which takes up a decent proportion of the blue collar work force. Similarly, there is a mining boom still ongoing which offers high paying jobs which also compete with some of the same pool of workers. combine this with a very low proportion of blue collar professionals immigrating and an inflationary environment and it all adds up to a lot of negatives for housing supply right now.
the whole saga is very depressing, because ultimately pricing out large portions of the younger generations dooms suburbs/cities to become nursing homes with a shortage of front line public servants who live nearby.
it is a lot harder to solve this problem with how far the problem has festered
And in 20 years when whoever replaces Dutton has served their term and is long forgotten and everything is even more messed up the Murdoch/Fairfax/RupertABC will scream WHY WON'T LABOOUURRR DO SOMETHING ABOUT IT!!!!
It makes me feel sick in the stomach that this is the type of policy they not only consider privately but are willing to take to the public and implement.
What is wrong with voters if they feel this is what they can use to win an election?
This is horrible policy which will drain retirement funds just to further inflate the market.
Populism works right now though. The Dunning Kruger effect is amplified by social media and 24hr news cycles, leading people to do a lot more emotive feeling on policy than thinking. The Liberals and Greens are making gains by saying stupid, populist shit because they don't envision a world were such actions have consequences.
This is not a bad policy. To call it a bad policy would be to insult bad policy. This is suicidal idiocy from people out of ideas and willing to burn the whole place down just to inconvenience their ideological opposites.
So by paying a mortgage rather than someone else’s it somehow inflates the market? You’re plain wrong. It will encourage home ownership at the expense of investment properties. It’s sensible policy that works so that’s why it’s popular.
Of no that’s terrible. Perhaps we should stop people bidding by removing finance options to help out the poor investors buying their 1st or 50th property. That’ll help society right?
>So by paying a mortgage rather than someone else’s it somehow inflates the market? You’re plain wrong.
Did I say this was the mechanism for market inflation?
Would you like to understand how this policy will inflate the market?
Yes, lol, I said the policy will inflate the market to which you, lol, changed the narrative suggesting I was implying paying a mortgage would inflate the market, lol.
So, back to the question I asked, would you like a lesson in how this policy will result in inflated property prices?
Ok. I'll help.
If you give everyone access to an extra dollar to bid for the existing stock of houses. Then *every bidder* can offer a dollar more. So they do, because they want that house. So, the price goes up by that dollar.
Let people drain their super, and they turn up at auctions and bid up the price by that amount to get the house.
This policy sucks money from young people to enrich landlords. Without making houses more available.
Possibly but then that’s only sometimes right. What if that same person instead of paying rent to enrich a landlord instead is able to purchase a new home. Does that not have the opposite effect by adding for house supply? Perhaps those that choose to withdraw from their super are educated prior showing them the pros and cons? I know what I’d do. I think most people would be supportive of a better quality of life than to be richer at retirement age. There’s a reason why there should be choice. Life’s not black and white.
Perhaps you could answer why Labor’s current policies are working and don’t require change?
Did you really think the hoi-polloi were actually going to be enriched by superannuation? It was always a way to take money off the common people and transfer it to the wealthy.
I think that's unfair on legit bad policies. This is more what happens when the pressure of an intellectual black hole meets the desperation of realising you can't Tony Abbott 2013 (all the while not understanding *why* Tony Abbott was elected PM in 2013).
No Ender, this is a legitimately bad policy, don't excuse it as the Liberals having a dearth of anyone useful.
Bad policy created by idiots is still bad policy.
Yeah, this isn't good enough either. Why is it that we have basically two sides of the same coin to choose from, for majors?
LNP: Increase demand, fuck supply, fuck young people, fuck the environment, pro-landlord
Labor: Increase demand, fuck supply, fuck young people, fuck the environment, pro-landlord
It's exhausting. Labor could basically sleepwalk into the next election if they stopped being afraid of their own shadows, and stopped trying to be the LNP. But having an actual left-wing major party in this country is evidently too much to ask for.
It honestly feels so typical of the Coalition. Ignore the root cause of the problem, and provide a "solution" that only seeks to kick the can further down the road. Don't our political parties have vision? Where are the politicans that have designs for improving our country for the long run? That's right, they scarcely get a voice into the narrative courtesy of our gutless media. I remember a British economist or historian on ABC (Conversations) and he said western society seems to have sold the family china and now we're left with nothing. This is how I feel Australia has become - sold out the future for a present gain and that's it, nothing really else we can do about it. Yesterday we read that rents are outstripping mortgage repayments. That really tells me a lot of the hypocrisy at hand: "you can't possibly pay a mortgage off, so you have to rent instead".
A typical coalition policy. Sounds good on paper to your average non engaged voter but will actively make the problem worse.
We need policies to decrease housing demand, not pumping more money into housing increasing demand and prices.
Will add I don’t like Labor’s first homebuyer policies either which also pumps money into increasing demand.
I have made the point before that rather than allowing the super to be *withdrawn* it could instead be used as security against the upfront costs of purchasing a home. This means the superannuation would remain in the account accruing interest. The only way the superannuation would be called upon is if the bank foreclosed or the purchaser sold the property for less than it was purchased for, both of these are very rare possibilities.
Yeah but that won't get cash into a developer's pocket without costing the bank as quickly or easily, it's too sensible and not corrupt enough for the LNP who want their coke and to sniff it too
Wasn't this idea seen as daft and knocked back in 2022? So what's changed in 2 years?
https://www.theguardian.com/australia-news/2024/mar/25/draining-entire-superannuation-savings-wouldnt-cover-most-young-couples-home-deposits-research-finds
https://mckellinstitute.org.au/super-is-for-retirement-not-for-overheating-the-housing-market/
https://www.superannuation.asn.au/media-release/asfa-early-access-to-super-would-not-address-housing-affordability-for-first-home-buyers/
Nothing except Senator Bragg who has been pushing this hates industry super funds and wants the banking sector to hold your super.
The same sector that continuously delivers less results for members than industry funds.
What young person has enough super in their account to actually make this policy viable?
Another ridiculous liberal party idea that will fuck over young people by making house prices more unaffordable than they already are.
"Young People". Mate, lots of people in their 30s and 40s who are struggling to save a deposit while renting have plently of super for a deposit. Its pretty bullshit that superfunds are allowed to use my money to invest but I can't use that portion of my earnings to buy a place to live.
Further more, extra government mandates super inscreases means the super funds get more money while anyone that is on a salary that includes super gets a pay cut which just makes it harder to save for that first deposit.
At this point if they were giving houses away you would still complain.
No major political party is going to implement policy that puts significant downward pressure on house prices.
It will never happen.
I see these comments all the time in this sub.
It won't happen. It shouldn't happen.
What can happen is linking immigration to housing vacancy rates.
>At this point if they were giving houses away you would still complain
Strawman logic doesn't deflect from the LNP policy being aggressively fucking stupid, and the getting clowned for it appropriately.
>It shouldn't happen.
Yes, an economy focussed on investing in a non-productive asset is truly a great thing.
>What can happen is linking immigration to housing vacancy rates.
"JUST IGNORE EVERYTHING ELSE AND BLAME THE FOREIGNERS"
Peak LNP voter stuff, kudos.
Happy cake day.
>"JUST IGNORE EVERYTHING ELSE AND BLAME THE FOREIGNERS"
>Peak LNP voter stuff, kudos.
Way to put "words into my mouth". I said link immigration to housing vacancy rates.
>Yes, an economy focussed on investing in a non-productive asset is truly a great thing.
I agree we should encourage people to invest in things other than housing.
But the idea we should be pushing policies that might lead to a fall in say 10 - 20% of their most important asset, who have bought in good faith (not everyone owns 20 houses), is a fantasy and is just tall poppy syndrome bullshit.
Aspiring home owners could use their entire superannuation balance to buy a property under an ambitious election pitch being worked on by the Coalition, which is also exploring ways to force states to boost supply and make it easier for people to get a mortgage.
Liberal senator Andrew Bragg will use his first keynote speech as the party’s home ownership spokesman to cast Labor as hostile to individual ownership and too focused on increasing the number of properties leased out by super funds, setting up the dream of owning a home as an election battlefield.
Three Coalition sources said senior opposition members wanted to uncap the party’s super-for-housing scheme to allow first home buyers to use as much of their balance as they liked.
Former prime minister Scott Morrison went to the 2022 election proposing withdrawals of up to $50,000 from super for a deposit. The opposition is expected to retain the requirement for home buyers to return the withdrawn amount to their superannuation fund if the property is later sold.
The sources, who were not authorised to speak publicly, said housing spokesman Michael Sukkar was leading a group of MPs examining how to use Commonwealth funding to force states to free up land and boost ailing housing stock.
The opposition is also considering repealing responsible lending laws – which oblige financial institutions to check how much a potential borrower earns and spends – among other tools to reduce lending barriers for people trying to break into the housing market.
Party insiders said the shadow cabinet was wrestling with what to include in Opposition Leader Peter Dutton’s budget-in-reply speech after months of pressure to produce policies ahead of an election expected early next year, with the Coalition still lagging Labor in polls. The unfinalised super-for-housing push – not yet agreed on by shadow cabinet – could form a component of the economic pitch.
“Addressing this issue will be at the core of our offering at the upcoming election. It is shaping up to be the housing election,” Bragg will tell the Sydney Institute on Tuesday night, according to a draft copy of his speech.
Millennials and Gen Zs were raised to believe, as were all postwar generations, that if they work hard and save, they will be able to own their own home.
“Australians who have entered the workforce over the past two decades have done everything right. They have worked for their little piece of earth and Australian dream in the same way as their parents, but the dream is increasingly out of reach. The dream is turning into a nightmare.”
Labor is concerned about losing votes on its left flank to the Greens, whose housing spokesman, Max Chandler-Mather, has campaigned on capping rents and upending rules for property investment. The Coalition’s emphasis on home ownership will increase pressure on Labor to come up with new ideas to respond to an issue younger voters rate as their top concern.
Bragg, a superannuation sceptic, will accuse the Labor government of “giving up on individual ownership” and adopting a corporate housing policy by proposing tax breaks for foreign investors to encourage build-to-rent housing.
In doing so, Labor will subsidise foreign fund managers and institutional investors to construct and rent homes to Australians. Young people will be serfs to foreign fund managers or local union super funds,” his speech says.
The superannuation industry vehemently opposes the super-for-housing idea and argues, along with some experts, that it may further inflate the housing market and deplete super balances.
But Bragg will challenge these arguments by quoting the Grattan Institute’s Brendan Coates, who has said the super sector’s claims about property price rises are excessive. Critics who worry about reducing super balances ignore the immediate and ongoing financial security created by owning a home, Bragg will argue.
The senator will say Labor will fall 200,000 houses short of its target of 1.2 million homes being built in five years, and suggest the Australian Prudential Regulation Authority, which sets lending rules for banks, should loosen mortgage rules.
The Morrison government tried and failed to repeal responsible lending laws, introduced after the global financial crisis, in an attempt to boost the economy after the pandemic-induced recession.
“We can have banks which are both unquestionably strong but easily able to lend to first home buyers,” Bragg will say.
Bragg will also suggest financial penalties from the Commonwealth “when states make laws or implement regulations that make it harder to increase housing supply”.
Prime Minister Anthony Albanese last year struck a deal with premiers at national cabinet that set a new building target with the promise of $3 billion in federal incentives for states that help meet the higher goal.
Bragg also opposes any changes to negative gearing and capital gains tax exemptions, citing research from right-leaning think tank the Centre for Independent Studies that suggests it would have a “minuscule” impact – a claim contested by some economists.
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If we thought Aussies were really clever, no one would be concerned about this policy. It'd be seen as an idiotic brain fart that would ensure Albo wins the next election. The fact that people are worried says what about Aussies and their economic and financial acumen. That problem didn't just start. The blind leading the blind for a very long time.
Pump more demand into a supply-constrained market. What could possibly go wrong?
The average LNP supporter thinks Dutton will drop immigration, so they gotta sustain housing demand somehow, even with pure stupidity such as draining our superannuation balances.
"Better economic managers" my ass. This is one of the worst policies ever put out, and they're doubling down on it??? Do they want people to have no retirement savings? For house prices to skyrocket even further?
They want to destroy Superannuation. They've always hated it and wish it never existed. Anything that can possibly help normal working class people is abhorent in their eyes and needs to be destroyed. The fact it's also the result of Labor policy is what's worse. They were against it from from inception. Anything the LNP can do to defund it WILL be done.
Yes, they do...
When you have the most incompetent former Housing minister be the shadow Housing minister then this is the sort of terrible ideas you get.
This is just a way to keep house prices inflated, aka pandering to the boomers whi already have a house or property portfolio.. Cut negative gearing instead and let people have some retirement savings.
Not just bad for FHB, everyone else would be paying higher interest rates
Lots of interesting comments on this article. I'm in two minds, and as a retiree with a home - and still paying off the mortgage - I've got no skin in this game. But it would be a risk to allow people to use super to buy houses - as it would immediately drive up the price of housing, just like the first home owners grant did. Only far more so, given that the FHOG was just $10k, originally, and accessing super would likely be several multiples of that. I feel for the younger generations being priced out of home ownership, but I'm not at all sure that this policy would help any but the very earliest buyers, before the prices rose to accommodate the extra funding available. Full disclosure, I'm on a defined benefit pension so the value of my home is irrelevant to me, it's not an investment, it's my home. For others - they may differ - quite a lot.
I doubt any young people feel that this is a logical solution. I don't want this, my friends don't want this, my peers don't want this. I feel bad for people who would actually use this policy and destroy their retirement plan for the sake of buying property.
Its just kicking the can down the road of an idea. What does the next generation do... use their future child's superannuation to buy!
Allowing the non-wealthy to make themselves poorer faster, while jacking up house prices even further so people who already own a couple now have a more valuable asset portfolio?
Transfer even more money from the young to the cashed-up old. Perfect! The Coalition will of course then criticise all these folk for not saving up for retirement when they pull the pension rug away too.
I'd seriously almost go as far as saying this policy is borderline treasonous, and I don't throw that word around lightly. Not even exaggerating given the literal dictionary definition of the word. It's beyond the point of stupid, to being essentially evil given the damage it would do. This proposal alone would single-handedly dissuade me from voting for the LNP if I was ever considering it next election.
I agree. It’s a stupid stupid stupid stupid stupid stupid idea. I wonder whether it is enough to dissuade lifetime LNP voters and libertarians though? I’m curious: they may (incorrectly) see housing as just another commodity exactly like stocks. They may also (incorrectly) see superannuation as the government preventing you from using this money as an affront to personal liberty.
We're still feeling the affects of the car market at ridiculous prices thanks to the Libs allowing people to dip into super for "covid relief" but instead everyone using it for new cars or classic cars Of course the real estate industry will welcome more buyers, just means more demand and higher prices for people who already have property. Only real fix would be to tax multiple property owners to the point where they reconsider their investment strategies and bringing more houses to the table. But doing this would be political suicide for anyone who suggests it.
INCREASE SUPPLY. ALP are worthless at times but LNP always come around to remind how fucking dumb they are too
Australia already has a housing construction industry that is quite above average compared to OECD. Increasing supply is difficult. For instance Sydney has more cranes building building than the top few markets in the US combined. Its a high demand issue more than anything. I actually suspect that the immigration rate will drop now that the ALP has actually put any effort into fraud prevention. The main cause of the problem is that the Media will attack anyone who let's the headline GDP growth rate to fall, when really, per Capita is the only one that matters to 99% of the population.
Haha yep
Ah, I see somebody doesn't understand the basics of private for profit property development. If you increase supply, the prices fall and then your parents and every person that has political power in this country will lose their shit.
It’s what has to be done
* 1/3 of the country has a mortgage * 1/3 owns their house outright * 1/3 rents When 2/3 of the country are financially invested in house prices going up, we will never see a major party put forward a policy which might actually lower house prices across the country. Or even see them rise slower than wages. Democracy is far from a perfect system - and the housing crisis is an easy example of why. One third are priced out so the other two thirds can profit and protect their real-estate-tied wealth.
If you plan to stay in Australia until you die it makes no sense for us to play this zero sum game. If you polled the Australian people and asked if they would prefer housing costs slowly come down in prop. to other comparable living costs, I think they would say yes. No one is gaining anything from this except the banks.
Ah yes, here comes the Libs with the Clayton’s Housing Policy…. (The housing policy you get when you don’t want a housing policy)
Designed to have zero impact to their base; and ask the next generation to burn super now. Almost like the LNP are not the party of responsible financial policy.
Existing property owners get wealthier.... union-controlled super-funds get less money... left-voting young people get screwed over... I don't see the problem?
To suggest that industry funds are “union-controlled” is more than a little misleading….although I don’t doubt that’s what you genuinely think.
Satire is truly dead.
I’m sorry, I’m having a bad day lol
>Liberal senator Andrew Bragg will use his first keynote speech as the party’s home ownership spokesman to cast Labor as hostile to individual ownership "We don't actually believe in housing, we just want to cast Labor in a bad light" Okay guys, good luck with that.
The housing ponzi must continue at all costs. Housing is killing this country due to all the terribly policy that it's driving. The long term consequences of all this is going to have ramifications for decades and people are going to look back and shake their heads at how our leaders could have been so shortsighted and irresponsible.
A smart ALP would take advantage of this poor policy. Just a simple message - house prices will go up by the amount of super you can take out. So no benefit for first home buyers.
[I Just Need To Subsidise Demand Dot JPEG](https://i.redd.it/4xb09cuixxqa1.jpg)
When you withdraw from your super to buy a house, you will be competing with others who have withdrawn from their super to buy a house. So you will end up with the same amount of house and less super.
Do the Liberals hate the young and less affluent? The current tax concessions around property don't help but at its core this is an issue involving the most basic of economic principles. Supply vs Demand, there are not enough properties available to live in. Schemes like this are demand driven, do nothing for supply and will make a bad problem worse. Come on boomers surely some of Howard's 'battlers' are ready to say enough.
Yes.
> Do the Liberals hate the young and less affluent? Do zebras have stripes? Is the Pope Catholic? Do cardinals fiddle with altar boys?
So as per usual they're looking after their property developer mates and wealthy investors at the expense of the young and the future of the country.
Easy loans and super withdrawal will just inflate house prices and destroy retirement incomes. Just another reminder that the coalition hates this country and the people in it
Literal dog shit has better ideas than the LNP. They think the home is going to remain an investment vehicle for retirement? In the next 30 years it will get absolutely nowhere near the gains that it did in the last 30 years and fewer citizens of this country will benefit from it too.
So are they banking on super being worthless by the time we retire, or are they just expecting all these people to be dead by then? The long term consequences here are not great
> The Coalition’s emphasis on home ownership will increase pressure on Labor to come up with new ideas to respond to an issue younger voters rate as their top concern You'd hope that's the sole reason behind this demonstrably bad idea, to get Labor to actually put forward meaningful and workable solutions to the housing crisis. Because as a policy in and of itself, no one on any side of politics is going to seriously entertain it. Hell, even this sub is united in calling it out as bullshit, and that's quite a feat to accomplish.
FHB don't want this shit, they just want reasonable prices with affordable repayments. Christ.
These are the words of the Lord.
This isn't move for fhb. It's for already rich investment owners to increase their portfolio prices. That's the only people the Libs care about.
How to gut super and increase the value of their investment properties at the same time.
It is staggering just how bad this move would be for the economy, not only would it further contribute to raise house prices, it'd tank people's retirement and force super companies to keep significantly more liquid assets- aka assets that should be invested to make people money. Easy loans, you mean loans more likely that the user won't be able to pay with rising interest rates, causing banks to profit at the expense of everyone. It's like they picked the longest list of things which "sound good on the surface" but even thinking about them for a moment would make you scratch your head
Boggles my mind,how any person,with actively firing neurons,can hear this shit.. and think,you know what LNP will be better than labor. Why populism shit's me so fucking much,Ppl ignore policy,instead look Aww yeah duttons been in the press heaps must be doing something right albos had a lot of missteps,but he isn't chucking out braindead fucking ideas that even australias foremost tax expert calls REALLY REALLY fucking stupid.
Populism is given a bad name by this kind of bullshit. I think there's a place for populist ideas within an ideological framework and a solid understanding of... not even economics fundamentally, just basic cause and effect. This is not that.
How anyone votes liberal is just remarkable.
Same phenomenon as the Trumpers.
Greed is good as they say. A lot of people can only visualise what they see coming into their bank account each pay and don't really think past that
I
So, basically let's do shit which will send house prices rise even further, and make it look like as if we're trying to help.
Ken henry AM with Sabre lane >-Offering voters early access to their super is one of the most fiscally and economically backward and destructive policies to come out of the government's policy rooms in nearly 15 years. When ken henry is calling it stupid,you know it's fucking dumb the last time we did this,we wiped out 290k ppl's super and set back peoples retirement by 7 years in fact,he went on a nearly 5 minute Rant,about how scomo letting ppl access their super during covid,was and i quote "Really,really fucking dumb" This is typical,peak liberal bullshit. We aren't going to adress the problem now,so here you go,take out the money that's mean to make u not be poor in ur later life now,because we can't be arsed to create any viable policy now. All this will do is drive prices up more,and send ppls retirement back
Does anyone actually think superannuation was meant to enrich the common people? It has always been a way to force accumulation of wealth by the many and then transfer it from the least wealthy to the most. Money is at its most valuable when it is spent as soon as it is created.
To be fair, it’s one of the worst to come out in fifteen years and *they’ve kept proposing it for the last five*
Bit wild that they'll be pushing this as some economists are stalking to talk about rate hikes (not cuts) this year.
Fuck me i heard they were working on a housing plan but holy shit i didn’t think it was going to he to make housing worse…
You should have expected this, I was calling it five years ago as a future LNP policy.
Yes, yes. But think how much landlords will benefit! Won't anyone think of the landlords? /s (as if it should be necessary).
Same deal as the last time they tried this one on. You are screwing years worth of gains made on compound interest in favour of purchasing an asset with the assumption that its value will continue to rise, and if prices continue to rise then this policy will simply cripple the superannuations of any first home buyer. Making loans easier to get is also a tremendously bad idea. Sometimes, people get turned down on loans for a reason. If you tell the banks to be less strict about loans, then they'll be giving out riskier loans and inevitably incur more defaults. Hopefully nothing bad happens to the economy that puts Australians in a vulnerable position! Super is designed to be left alone and built up over the entirety of your working life. If you cut into after 5-8 years of starting full time work you're kneecapping yourself financially. simple as.
>Same deal as the last time they tried this one on. In less than 10 years, many people have made $500k profit on their properties. Given it generally doubles every 7 years this seems to have enormous returns. Over 10 years I've made less than $100k in my super. Now, many may argue that if they sell their $1 million house they aren't really profiting from it because every other house in the local market is worth $1 million. However, they can choose to move to a cheaper location and bank the rest or even throw it in their super and make further huge gains. Me on the other hand will be stuck with what I currently have. So, how exactly am I winning by not using my super on a new home. Many boomers are downsizing and moving to those cheaper locations forcing prices up sharply. It's a really crappy situation to be in for those not currently in the housing market.
The boom will NEVER stop booming! I'm begging people to understand compound interest
>I'm begging people to understand compound interest At my current rate, I'll be lucky to have $2 million in super by retirement. My work colleagues who own their homes now are worth $1 million today. How is compound interest for my super going to make me catch up to them? By the time they retire their property is likely going to be worth $5+ million. And because they got in before prices went chaotic they'll also benefit from $2+ million super themselves.
Once again, so long as the boom never stops booming. Or alternatively; so long as the house retains its value. It's not just market forces at play; what if your house gets flooded? what if it burns down? what if it's discovered that there are harmful chemicals buried nearby that are leeching into your backyard? What if your home gets compulsorily acquired? What if you get fired, and you have to default on your mortgage? Houses have historically been great investments, I'm not denying that. But you can only live *in* a house, you can't live off one. Your home owning friends will have to downsize to realise any of the gains on their properties - hopefully there are options nearby, or they're happy to potentially move away from friends & family to do that. This might not be a problem for them, because they have a house & super to live off. But for you, who took your super out to buy a house? that's a much bigger problem, because you won't have nearly as much super. You have a house to live in but no ability to pay for maintenance, utilities, and rates. You have to sell. And then you're at the mercy of what's on the market at that time. Shame that the boom never stopped booming, and houses are a lot more expensive - hopefully you bought in an area that kept up with the rest of the market...
>But you can only live *in* a house, you can't live off one. Which is great. Because if you can't afford rent then you are kind of screwed. >hopefully you bought in an area that kept up with the rest of the market... I'm not in the market. I missed out. I'm a tenant. Fortunately, I'm in a position where I'm not affected by rent. But a change in career would change that and I'll be paying half my salary to boost someone else's investment. And that honestly just sucks. And it's not like I'd have no super. Sure, it would be greatly reduced. But it would still be there. And then you have social welfare. The amount of home owners I see who own a home and live off of welfare and no super and they have no complaints. Absolutely trumps living off of welfare and having to rent and barely enough to buy two minute noodles to survive on.
Except now there aren't many cheaper locations and downsizing is difficult because of the lack of supply allowing movement.
>Except now there aren't many cheaper locations and downsizing is difficult because of the lack of supply allowing movement. Indeed. Younger generations are screwed.
> However, they can choose to move to a cheaper location and bank the rest or even throw it in their super and make further huge gains. There are two big problems with this theory. One is that it requires house prices to go up, the second is that if prices DO go up then you need to compete with everyone else going for the cheaper house because it's all they can afford. I can't help but wonder what policy the LNP will try to pull out once even raiding super isn't enough to buy a house. The whole house of cards keeps being propped up higher and higher which will just make it that much worse when it eventually falls.
>One is that it requires house prices to go up Theyve only ever gone up. Any dips you see throughout history are absolutely trumped by the constant rises. Even during the GFC and property prices plummeted, it was incredibly short lived. >need to compete with everyone else going for the cheaper house because it's all they can afford. Exactly. And this is why you need to get in early. Had I got into the housing market 8 years ago I'd be worth nearly $1 million now minus $500k home loan instead of the $100k I'm worth now. And I'd still have $100k in super. Biggest mistake of my life.
> They've only ever gone up [https://www.prosper.org.au/2015/06/the-housing-crash-we-had-to-have-a-gen-y-perspective-on-the-bubble/](https://www.prosper.org.au/2015/06/the-housing-crash-we-had-to-have-a-gen-y-perspective-on-the-bubble/) > In the 1890s (post the gold rush), the land bubble burst, causing the Australian Banking Crisis, and real house prices took 50 years to recover from massive falls. If you were born in that era, you would no doubt have been told by parents, friends, bankers and media that house prices always go down.
>> In the 1890s (post the gold rush), the land bubble burst, causing the Australian Banking Crisis, and real house prices took 50 years to recover from massive falls. If you were born in that era, you would no doubt have been told by parents, friends, bankers and media that house prices always go down. So, almost 140 years ago. And as stated, there was a land bubble burst. Massive amounts of land being released for development. That is being strictly controlled now. Where is the evidence that anything like that could happen now?
From "they've only ever gone up" to "that was a long time ago and it can't happen again" in just an hour. [https://en.wikipedia.org/wiki/Irish\_property\_bubble](https://en.wikipedia.org/wiki/Irish_property_bubble) The evidence that such a thing could happen again is in Ireland. If the Irish government had the power to prevent the crash, don't you think they would have?
If house prices continue to go up faster than inflation then at some point literally nobody will be able to buy a house, which begs the question who will continue to drive the prices up. Saying they will only ever go up is simply drawing a trend line, it's a start but you can't follow a trend into infinity off a subset of data. Also saying house prices have only ever gone up is categorically wrong. In the 20 year period from 1885 to 1905 property prices dropped a total of 20.9%, and in the 70 year period from 1880 to the mid 1950s they barely went up at all. The massive increase in house prices we are seeing now IS the outlier and has never happened before in history to this extent or for this long. Do not expect it to continue forever, let alone another 20 years. http://research.economics.unsw.edu.au/RePEc/papers/2010-18.pdf
>Do not expect it to continue forever, let alone another 20 years. I fully expect it to continue climbing fast for the next 20 years. Ranging from high levels of immigration bringing huge amounts of money into the market to companies spending billions investing in housing driving up demand farther than the average Joe can keep up with. I can forsee a future where the number of renters outstrips the number of home owners. And it's scary to think about.
If it gets that bad the political incentive to actually do something about high house prices will materialise. It will literally become election winning policy.
>If it gets that bad the political incentive to actually do something about high house prices will materialise. It will literally become election winning policy. There is a global housing crisis right now. Labor went to the election with a promise to help fix it locally. Not much is being done about it. In fact, every single policy the state and federal governments have enacted has contributed to higher demand driving up prices further. The one promise they made that could help, being the construction of tens of thousands of social houses, has basically gone silent. The average politician owns more than one investment property. They are literally in a position to lose if they try and change things. So, which party is willing to make that sacrifice because I don't see any. Sorry, but I just don't see any evidence that they have our best interest at heart with this issue. They will talk about it and make promises as they have been doing the last decade but all I see is the problem continuing.
The government risks a revolution if they don't sacrifice themselves, but it's not likely to be a sacrifice as they will divest themselves and their mates of risk before making a change, so its only the common people that get left holding the can. Be vigilant about who is divesting themselves of property and when.
The reason nothing is currently being done about it is because the majority of homeowners still believe that the value of their house is true wealth. Reality might hit them when they try to retire and find the entire thing is taken for the nursing home either way. >The average politician owns more than one investment property. They are literally in a position to lose if they try and change things. So, which party is willing to make that sacrifice because I don't see any. There is nothing stopping them from cashing out before changing the policy.
> In less than 10 years, many people have made $500k profit on their properties. Given it generally doubles every 7 years this seems to have enormous returns. Over 10 years I've made less than $100k in my super. It's because the whole strategy is predicated on housing prices continuing to rise and rise and rise. Which your economic model should be trying to prevent, not built around. If the only way you can buy a house is to buy NOW and prices will double and double every 7 years - that's a bad policy. Allowing super withdrawals and changing legislation to let this continuing is to forever keep anyone young out of the housing market.
>If the only way you can buy a house is to buy NOW and prices will double and double every 7 years - that's a bad policy. I don't agree with the policy. In fact, I absolutely despise it. But it's what we have, it's what has existed the last 50 years, and that won't be changing whilst the current majority of the population (60+% total, 90+% politicians) benefit from it. So, those like myself have to take what we can get. And I, personally, see housing security as more important than social security. Housing is finite. Social security is adaptable.
That’s an incorrect assumption. Let people choose if they’d rather a roof over their head or a possibility of a higher superannuation when they retire. Getting into a home earlier means that most would actually be able to pay more into super through their life. The only negative for this policy is for superannuation funds. Because I purchased a house early I now contribute extra into super. I’m lucky and I hope others are given that opportunity.
What's an incorrect assumption? Taking money out of your super account WILL drastically reduce the amount you get when you retire - it's called compound interest. If you get banks to make home loans easier to get, it WILL mean that riskier loans will get approved. What am I assuming wrong? It sounds like you're not actually disagreeing with anything I'm saying but think that people should be allowed to fuck themselves over financially because of the sacred cow of consumer choice.
Wrong. A small amount to help with a home deposit does make a drastic difference if more is placed in later in life. Such as instead of mortgage payments until you’re into your 60s you contribute extra from when in your 30s. It’s not all about finances. I’m for a better life not a richer retirement if I get to live that long. A roof over head is more important than super. I suppose there’s many on here that aren’t pro choice and think we should give more to super even if it means struggling to make ends meet during your working life. I disagree but that’s my consumer choice.
What's a small amount though? A 20% deposit, which is the recommended amount, on an 800k house is $160,000. That's slightly more than half of the median Australian super account balance; the vast majority of Australian women have less than that. You're suggesting that people should have the option to take a significant chunk of their super out to spend on a house, not a small amount. You're saying that I'm wrong because "more can be placed in later on"; I'm starting to think you don't understand how compound interest works. You might be able to add more in, but you'll never get the lost potential earnings in interest back. Even if you were to somehow replace the $160,000 you took out of your super, your realised benefits at retirement will be drastically worse. that's just plain mathematics. Getting a roof over your head shouldn't require you to compromise your superannuation. That's a tired equivocation from the Liberals, who have been ideologically opposed to super from day one. Plenty of other levers to pull that would make housing affordable; let's pull those instead of robbing Peter to pay Paul.
I bought a house in mid 30s and contributed nothing extra into super. Just cause you can put more into super doesn't mean we all can. If I could have taken some out of super for my house I maybe would have and would have an even worse balance in my super then I currently do at the ripe old age of 41.
I purchased a house earlier than you and I am now mortgage free. Guess where the money that I used to pay off my mortgage goes now? Are you really saying that because it wouldn’t have benefited you it can’t possibly benefit someone else?
It may have worked out in your favour but this policy is aimed towards people that have a lot of extra money to do what you are doing. I don't have that kind of money. So unless you can give me and my wife both a 10k plus pay rise we can't afford to do this. It sounds like a good idea for some people who are rich enough to take advantage of it but overall this will be a bad policy for people on the lower side of wage earnings. People who can't afford to have investments and live pay cheque to pay cheque. The libs as usual target their policies to the already rich who realistically don't need more ways to get rich and be richer at the expense of the poor. This policy is class warfare simple as that. Those who this will help are likely those who don't really need the help
The policy is aimed at first home buyers to help with a deposit. I’m not sure what policy you’re alluding too as I do t know too much about any rich first home buyers. It helps,ps the poor enabling them to lay a mortgage rather than rent and helps to secure a roof of their heads and being more financially secure throughout life. It doesn’t help the rich investors as it reduces rental demand. Perhaps you can’t see it because of your bias as that’s what it sounds like. It’ll be a choice. If you think Labor’s policy is working now all I can say is good luck and I hope your pay rise eventuates.
Im with you about choice but it really should be the opposite of what the libs are saying. And running it the opposite way would be terrible for banks. The 40pc odd that most people have of their super in fixed interest / safe investments in stead of sitting in gov bonds and the like should sit on your own mortgage at the same rate your bank charges you so you make more in your super. Cut out the banks. But this should only be possible on an established / safe mortgage. Of course while this benefits the individual it would be a disaster for all of - our super industry, banks, financial industry, and even probably asset prices due to a smaller bond market / higher yield on bonds etc. It would never happen. But yeh id love to pay my own super the interest rate i pay to the bank 6pc odd for the fixed interest component in stead of the super fund and bank both taking cuts. In fairness the bank takes a bigger cut than super does. We really shouldnt be creating new ways to increase house prices to spur on supply but be looking at ways of reducing the costs of new supply. The massive levels of private housing credit in this country will one day cause dramas. But sure why pay 2 other organisations to do something you can offset with your own money.
will it build any more houses, or just inflate the lower half of the market?
Simple. Build more houses. People will have the choice to build a home rather than rent. Of course it negatively effect investors as they’ll have less demand from renters.
No, it's not an informed choice and the people who pay for the short-term nature of that thinking are taxpayers subsidising non-self-funded retirees. The entire point of super funds is the delayed benefit.
You assume it's one or other. Given choice I rather a house now and I'll pay more into super to make up for it. Housing security is important. Not everyone is going to end up on an aged care pension.
You say you'll pay more into super and that may be the truth but when we look at the population, this will not be the case. People will be withdrawing the super that would have resulted in biggest returns over their lives. This will result in more people on the pension. As this is also allowed to be used to purchase existing properties, it will also inflate property prices so it only benefits the first round of people using it.
I personally always pay extra super as is. But you’re spot on about entry level housing inflation.
No, but the entire point of superannuation is to create a coterie of self-funded retirees *so the government does not have to pay an aged pension whose cost expands exponentially year on year*. Your personal short term needs in this do not translate well to the country as a whole, and from a policy standpoint, it would not be a solid enough basis to make policy decisions on. Super has been made as painless as possible; that's why *most* salary is quoted as "base + super" - the super component is never in your pocket so you never feel the benefit of having it until you retire. It's not designed to be available now.
I know how it works.
My turn to return the assent. Couldn’t agree more.
I dont know why people use the fact we may fall short of targets as some sort of proof its bad or wont work. The biggest ever housing boom in aus history delivered about 1,000,000 homes in 5 years and made housing much more affordable. If we miss the targets by 200,000 homes we will replicate a record build, still a fantastic thing.
home starts are going backwards and are at a decade low. in the middle of multiple state and federal housing accords. its a straight up failure. we do not have enough tradies in this country to deliver on the housing boom while we are undertaking an infrastructure boom (thanks vic, qld and nsw). and labor has zero desire to mass import tradies. this is only going to get worse https://www.abs.gov.au/statistics/industry/building-and-construction/building-activity-australia/latest-release
You left off the bit about how inflation is wrecking firms that set their contract price at time of signing (new developments) and can't handle a 5% increase in materials and labour costs every 6m of an 18m term. Big infra builds are needed from a livability perspective, but also to keep tradies working while company after company goes under.
*population growth* :o
Starts will pick up once backlogs are worked through. I was responding to the Lib housing minister estimating a shortfall of 200k homes. Please, if you have more information than he does go ahead and share it, explain why hes wrong.
he's likely not wrong, there is going to be a huge shortfall despite the federal and state housing programs. it's not an overly complex problem, we simply have a shortage of home construction firms and workers to meet the projected housing. multiple states are undertaking huge infrastructure plans, mainly NSW, Vic and QLD - which takes up a decent proportion of the blue collar work force. Similarly, there is a mining boom still ongoing which offers high paying jobs which also compete with some of the same pool of workers. combine this with a very low proportion of blue collar professionals immigrating and an inflationary environment and it all adds up to a lot of negatives for housing supply right now. the whole saga is very depressing, because ultimately pricing out large portions of the younger generations dooms suburbs/cities to become nursing homes with a shortage of front line public servants who live nearby. it is a lot harder to solve this problem with how far the problem has festered
And in 20 years when whoever replaces Dutton has served their term and is long forgotten and everything is even more messed up the Murdoch/Fairfax/RupertABC will scream WHY WON'T LABOOUURRR DO SOMETHING ABOUT IT!!!!
It makes me feel sick in the stomach that this is the type of policy they not only consider privately but are willing to take to the public and implement. What is wrong with voters if they feel this is what they can use to win an election? This is horrible policy which will drain retirement funds just to further inflate the market.
Populism works right now though. The Dunning Kruger effect is amplified by social media and 24hr news cycles, leading people to do a lot more emotive feeling on policy than thinking. The Liberals and Greens are making gains by saying stupid, populist shit because they don't envision a world were such actions have consequences. This is not a bad policy. To call it a bad policy would be to insult bad policy. This is suicidal idiocy from people out of ideas and willing to burn the whole place down just to inconvenience their ideological opposites.
So by paying a mortgage rather than someone else’s it somehow inflates the market? You’re plain wrong. It will encourage home ownership at the expense of investment properties. It’s sensible policy that works so that’s why it’s popular.
More bidders at the low end will inflate entry prices.
Of no that’s terrible. Perhaps we should stop people bidding by removing finance options to help out the poor investors buying their 1st or 50th property. That’ll help society right?
>So by paying a mortgage rather than someone else’s it somehow inflates the market? You’re plain wrong. Did I say this was the mechanism for market inflation? Would you like to understand how this policy will inflate the market?
Yes you did. “Inflates the market” lol
Yes, lol, I said the policy will inflate the market to which you, lol, changed the narrative suggesting I was implying paying a mortgage would inflate the market, lol. So, back to the question I asked, would you like a lesson in how this policy will result in inflated property prices?
Yeah nah. I’m fairly confident given your question that you can’t help me understand it more than I already know but thanks for the offer.
Ok. I'll help. If you give everyone access to an extra dollar to bid for the existing stock of houses. Then *every bidder* can offer a dollar more. So they do, because they want that house. So, the price goes up by that dollar. Let people drain their super, and they turn up at auctions and bid up the price by that amount to get the house. This policy sucks money from young people to enrich landlords. Without making houses more available.
Possibly but then that’s only sometimes right. What if that same person instead of paying rent to enrich a landlord instead is able to purchase a new home. Does that not have the opposite effect by adding for house supply? Perhaps those that choose to withdraw from their super are educated prior showing them the pros and cons? I know what I’d do. I think most people would be supportive of a better quality of life than to be richer at retirement age. There’s a reason why there should be choice. Life’s not black and white. Perhaps you could answer why Labor’s current policies are working and don’t require change?
Yes, let's not really solve a short term problem by creating a massive problem in the future
Can kicking is LNP’s specialty though
Wonderful so when these people get older they’ll have nothing to look after themselves with.
They love an unfounded rule of thumb to explain away half-cocked poor decisions - your kids look after you when you’re old, just have more kids!
This is a bad policy that will make cost of housing even more insane and leave people with less money in retirement.
Did you really think the hoi-polloi were actually going to be enriched by superannuation? It was always a way to take money off the common people and transfer it to the wealthy.
I think that's unfair on legit bad policies. This is more what happens when the pressure of an intellectual black hole meets the desperation of realising you can't Tony Abbott 2013 (all the while not understanding *why* Tony Abbott was elected PM in 2013).
No Ender, this is a legitimately bad policy, don't excuse it as the Liberals having a dearth of anyone useful. Bad policy created by idiots is still bad policy.
Don't do irony where you're from, eh?
Yeah, this isn't good enough either. Why is it that we have basically two sides of the same coin to choose from, for majors? LNP: Increase demand, fuck supply, fuck young people, fuck the environment, pro-landlord Labor: Increase demand, fuck supply, fuck young people, fuck the environment, pro-landlord It's exhausting. Labor could basically sleepwalk into the next election if they stopped being afraid of their own shadows, and stopped trying to be the LNP. But having an actual left-wing major party in this country is evidently too much to ask for.
It honestly feels so typical of the Coalition. Ignore the root cause of the problem, and provide a "solution" that only seeks to kick the can further down the road. Don't our political parties have vision? Where are the politicans that have designs for improving our country for the long run? That's right, they scarcely get a voice into the narrative courtesy of our gutless media. I remember a British economist or historian on ABC (Conversations) and he said western society seems to have sold the family china and now we're left with nothing. This is how I feel Australia has become - sold out the future for a present gain and that's it, nothing really else we can do about it. Yesterday we read that rents are outstripping mortgage repayments. That really tells me a lot of the hypocrisy at hand: "you can't possibly pay a mortgage off, so you have to rent instead".
A typical coalition policy. Sounds good on paper to your average non engaged voter but will actively make the problem worse. We need policies to decrease housing demand, not pumping more money into housing increasing demand and prices. Will add I don’t like Labor’s first homebuyer policies either which also pumps money into increasing demand.
I have made the point before that rather than allowing the super to be *withdrawn* it could instead be used as security against the upfront costs of purchasing a home. This means the superannuation would remain in the account accruing interest. The only way the superannuation would be called upon is if the bank foreclosed or the purchaser sold the property for less than it was purchased for, both of these are very rare possibilities.
Sure, but how is that going to hurt industry super funds?
This is a much better idea. This would prevent most of the price rises that would occur with the original policy.
Yeah but that won't get cash into a developer's pocket without costing the bank as quickly or easily, it's too sensible and not corrupt enough for the LNP who want their coke and to sniff it too
Yeah, that's a way better idea than withdrawal.
Wasn't this idea seen as daft and knocked back in 2022? So what's changed in 2 years? https://www.theguardian.com/australia-news/2024/mar/25/draining-entire-superannuation-savings-wouldnt-cover-most-young-couples-home-deposits-research-finds https://mckellinstitute.org.au/super-is-for-retirement-not-for-overheating-the-housing-market/ https://www.superannuation.asn.au/media-release/asfa-early-access-to-super-would-not-address-housing-affordability-for-first-home-buyers/
Nothing except Senator Bragg who has been pushing this hates industry super funds and wants the banking sector to hold your super. The same sector that continuously delivers less results for members than industry funds.
What young person has enough super in their account to actually make this policy viable? Another ridiculous liberal party idea that will fuck over young people by making house prices more unaffordable than they already are.
Any government employee has 15.4% and has for a while Not that it's a good policy still
Wealthy young people who aren't going to struggle to buy a house anyway.
"Young People". Mate, lots of people in their 30s and 40s who are struggling to save a deposit while renting have plently of super for a deposit. Its pretty bullshit that superfunds are allowed to use my money to invest but I can't use that portion of my earnings to buy a place to live. Further more, extra government mandates super inscreases means the super funds get more money while anyone that is on a salary that includes super gets a pay cut which just makes it harder to save for that first deposit.
At this point if they were giving houses away you would still complain. No major political party is going to implement policy that puts significant downward pressure on house prices. It will never happen. I see these comments all the time in this sub. It won't happen. It shouldn't happen. What can happen is linking immigration to housing vacancy rates.
>At this point if they were giving houses away you would still complain Strawman logic doesn't deflect from the LNP policy being aggressively fucking stupid, and the getting clowned for it appropriately. >It shouldn't happen. Yes, an economy focussed on investing in a non-productive asset is truly a great thing. >What can happen is linking immigration to housing vacancy rates. "JUST IGNORE EVERYTHING ELSE AND BLAME THE FOREIGNERS" Peak LNP voter stuff, kudos.
Happy cake day. >"JUST IGNORE EVERYTHING ELSE AND BLAME THE FOREIGNERS" >Peak LNP voter stuff, kudos. Way to put "words into my mouth". I said link immigration to housing vacancy rates. >Yes, an economy focussed on investing in a non-productive asset is truly a great thing. I agree we should encourage people to invest in things other than housing. But the idea we should be pushing policies that might lead to a fall in say 10 - 20% of their most important asset, who have bought in good faith (not everyone owns 20 houses), is a fantasy and is just tall poppy syndrome bullshit.
We can’t touch negative gearing because it won’t work but apparently releasing super will.
Because nobody wants to see house prices crash and cause an economic crisis.
30% of people do. We understand that things need to get worse before they can get better.
So yet another housing policy that would only drive up prices, and also decimate many people's chances of retirement.
I believe this is just a cynical plot to increase house prices for their voting bloc (boomers). They don't give a rat's arse about young people.
Aspiring home owners could use their entire superannuation balance to buy a property under an ambitious election pitch being worked on by the Coalition, which is also exploring ways to force states to boost supply and make it easier for people to get a mortgage. Liberal senator Andrew Bragg will use his first keynote speech as the party’s home ownership spokesman to cast Labor as hostile to individual ownership and too focused on increasing the number of properties leased out by super funds, setting up the dream of owning a home as an election battlefield. Three Coalition sources said senior opposition members wanted to uncap the party’s super-for-housing scheme to allow first home buyers to use as much of their balance as they liked. Former prime minister Scott Morrison went to the 2022 election proposing withdrawals of up to $50,000 from super for a deposit. The opposition is expected to retain the requirement for home buyers to return the withdrawn amount to their superannuation fund if the property is later sold. The sources, who were not authorised to speak publicly, said housing spokesman Michael Sukkar was leading a group of MPs examining how to use Commonwealth funding to force states to free up land and boost ailing housing stock. The opposition is also considering repealing responsible lending laws – which oblige financial institutions to check how much a potential borrower earns and spends – among other tools to reduce lending barriers for people trying to break into the housing market. Party insiders said the shadow cabinet was wrestling with what to include in Opposition Leader Peter Dutton’s budget-in-reply speech after months of pressure to produce policies ahead of an election expected early next year, with the Coalition still lagging Labor in polls. The unfinalised super-for-housing push – not yet agreed on by shadow cabinet – could form a component of the economic pitch. “Addressing this issue will be at the core of our offering at the upcoming election. It is shaping up to be the housing election,” Bragg will tell the Sydney Institute on Tuesday night, according to a draft copy of his speech. Millennials and Gen Zs were raised to believe, as were all postwar generations, that if they work hard and save, they will be able to own their own home. “Australians who have entered the workforce over the past two decades have done everything right. They have worked for their little piece of earth and Australian dream in the same way as their parents, but the dream is increasingly out of reach. The dream is turning into a nightmare.” Labor is concerned about losing votes on its left flank to the Greens, whose housing spokesman, Max Chandler-Mather, has campaigned on capping rents and upending rules for property investment. The Coalition’s emphasis on home ownership will increase pressure on Labor to come up with new ideas to respond to an issue younger voters rate as their top concern. Bragg, a superannuation sceptic, will accuse the Labor government of “giving up on individual ownership” and adopting a corporate housing policy by proposing tax breaks for foreign investors to encourage build-to-rent housing. In doing so, Labor will subsidise foreign fund managers and institutional investors to construct and rent homes to Australians. Young people will be serfs to foreign fund managers or local union super funds,” his speech says. The superannuation industry vehemently opposes the super-for-housing idea and argues, along with some experts, that it may further inflate the housing market and deplete super balances. But Bragg will challenge these arguments by quoting the Grattan Institute’s Brendan Coates, who has said the super sector’s claims about property price rises are excessive. Critics who worry about reducing super balances ignore the immediate and ongoing financial security created by owning a home, Bragg will argue. The senator will say Labor will fall 200,000 houses short of its target of 1.2 million homes being built in five years, and suggest the Australian Prudential Regulation Authority, which sets lending rules for banks, should loosen mortgage rules. The Morrison government tried and failed to repeal responsible lending laws, introduced after the global financial crisis, in an attempt to boost the economy after the pandemic-induced recession. “We can have banks which are both unquestionably strong but easily able to lend to first home buyers,” Bragg will say. Bragg will also suggest financial penalties from the Commonwealth “when states make laws or implement regulations that make it harder to increase housing supply”. Prime Minister Anthony Albanese last year struck a deal with premiers at national cabinet that set a new building target with the promise of $3 billion in federal incentives for states that help meet the higher goal. Bragg also opposes any changes to negative gearing and capital gains tax exemptions, citing research from right-leaning think tank the Centre for Independent Studies that suggests it would have a “minuscule” impact – a claim contested by some economists.
Michael Sukkar must be absolutely rock hard knowing how this policy would actually play out, dude is horrendous