The federal government will allow first-home buyers to access up to $50,000 of their superannuation to purchase a house and will drop the age for downsizer contributions to 55 if it is re-elected at the upcoming election.
A statement outlining the plan on the Liberal Party website said that under the Super Home Buyer Scheme, first-home buyers could use up to 40 per cent of their superannuation, up to a maximum of $50,000, to purchase a house, but would be required to return the amount to their fund, with a proportionate share of capital gain, when the house was sold.
The scheme would start from 1 July 2023 and apply to new and existing homes, but would have no income or property caps, and will be restricted to first-home buyers who have saved 5 per cent of the house deposit separately from the money accessible from superannuation.
According to the statement, the scheme will reduce the average time taken to save a deposit by three years, with Prime Minister Scott Morrison saying: “Super should be harnessed to support the aspiration of many thousands of families who want to buy a home.”
Superannuation, Financial Services and the Digital Economy Minister Jane Hume said the plan was “a two for one win for Australians” that resulted in a home and a return on retirement savings.
“Under the Super Home Buyer Scheme you keep building your super savings – in the home you live in,” Hume said.
“It gets the balance right, helping first-home buyers break into the market but protecting their retirement savings.
“Superannuation is there to help Australians in their retirement and the Super Home Buyer Scheme will ensure Australians can use those savings they are responsibly building up to improve their quality of life now and standard of living in retirement.”
Addressing the older end of the housing market, the government’s promise to extend the age for downsizer contributions into superannuation down to 55 will commence on 1 July 2022 and follows on from the reduction in age from 65 to 60 announced in last year’s budget and scheduled to commence on 1 July 2022.
The website stated this change would allow a further 1.3 million households to access the downsizer scheme and would work in tandem with plans to allow pensioners to have two years, rather than one, in which the proceeds of the sale of a family home were exempted from the assets test.
Assistant Treasurer and Housing Minister Michael Sukkar said the measures benefited those looking to downsize, as well as younger families looking for their next home.
“These changes will directly help in unlocking the supply of larger homes for those younger families who are hoping to expand and at the same time incentivise older Australians to downsize by putting more into their super,” Sukkar said.
Social Services Minister Anne Ruston added the announcement also recognised some older homeowners would prefer a smaller property with less upkeep as they aged.
“This announcement gives them confidence to make that decision and builds on the additional support a re-elected Morrison government will provide seniors, including freezing the deeming rate so age pensioners can keep more of the money they earn from investments and expanding the eligibility for the seniors healthcare card to more self-funded retirees,” Ruston said.
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