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Let FHBs access superannuation: HIA

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Australian Broker | 12 Mar 2015, 08:26 AM Agree 0
Allowing first home buyers to dip into their superannuation to purchase their first property is a good idea, according to a leading housing association
  • Mega Broker | 12 Mar 2015, 09:26 AM Agree 0
    Great idea and whilst they are at it they should re-vamp the FHOG to allow purchase of existing properties and not just new or build.

    My only restriction to be implemented would be that if property is sold then the original Super funds go back into Super plus a % based on the % profit made on the house from purchase. Also, only one bite at the cherry but you can use the original drawn Super sum to purchase again.
  • RC | 12 Mar 2015, 09:59 AM Agree 0
    It is quite probable & realistic to allow FHB access their Super assets to buy their first Home. There is no reason why the funds borrowed fom the Super Account cannot be repaid as a seperate account for the purpose of repaying back these funds into the Super account say when that person sells or discharges that Mortgage Facility or refinances to another Lender. I am being totally simplistic here,but with a bit of thought a well structured approach of an account could be designed or offered. One main concern I can see with most thoughts on this concept of accessing your Super Is the possible issue with future concerns whether that money could be eaten up in a divorce settlement or a business venture gone wrong, or whatever. the approach would be to insure that any funds utilised from a Members Super account into a loan facility be held as a seperate entity & retuned as such. Come on you Economic Guru's out there, there must be some free Thinker still left in Australia in our current Government hat has the ability to structure this. Realistically this is an incentive for ALL young Australian's to have a reason to contribute additional funds to Super above the standard 9.5% Compulsary by Employers. Maybe our Government offers additional incentives or the Super Fund Provider attaches an additional account facility under the Members Super account that is purely for the purpose using to fund a home. Have been a FP for 30 + yrs & a Mortgage Broker for 13 yrs.
    If I can formulate or offer possibilities on doing something surely an expert can?

  • Concerned | 12 Mar 2015, 10:38 AM Agree 0
    I agree with both RC and Mega broker to a certain extent however my concerns also are around the potential loss of the Super funds due to divorce, separation, poor property selection. I like the idea that it must be returned to the super fund but how does one track this and over what time frame? Perhaps a percentage of the loan repayment or the principle in the first instance could be paid back into the super instead of the property until it's replaced? With the current structure at least we know it's tucked away for a long time and there will be something left at retirement age for our children. Yes, more discussion before rash decisions are made should happen, but the super amount taken should be replaced somehow.
  • Papery | 12 Mar 2015, 10:53 AM Agree 0
    No No No..... All this will do is push property prices the spruikers/marketeers start rubbing there dirty little hands together.

    There is too much inherent risk.

    If people bought there homes & stayed put for around 10 years, then there is maybe a small chance that the plan might have merit; but we all know that most loans have a life of around 3-5 years & most people dont stay put for very long before they start chasing a ppty upgrade, need to relocate for work or lack of, get sick of their relationship & family & end up in front of a an expensive Solicitor & then the courts, not to mention the added issues with the friendly Child Support agency.

    And if their is some sort of prioirity on the ppty to repay a super contribution, how will this affect our mortgage insurers. Most of the young-uns not only struggle to save a modest deposit above cost of living pressures, but in most instances their Super is worth squat in these early years anyway.

    Something else to consider, by the time the average punter pays Agents costs & stamp duty (if upgrading) theres not usually much change left over, especially if they also want to clear some of the credit card debt which has been used to support lifestyle.

    The Integernational Report is an opportunity to rewrite how we view the Great Australian Dream including home ownership, how & when we retire & how we pay for it, Welfare Benefits etc. Its also time our financiers starting getting some free & lateral thinkers to get some perspective about what the average family & average borrower looks like & what they need.

    Hey kids.... we have well & truely moved beyond the 1950's & even 1980's.
  • Phil O | 12 Mar 2015, 11:25 AM Agree 0
    This is a great opportunity to assist people into home ownership that should not be wasted. The industry should consider a system where the Lender could take a charge over the Super to cover a 5% deposit + associated costs/fees. The benefits of this would be 1. No cash withdrawal required from super account. 2. Lender would only call on charge in case of default. 3. Charge could be withdrawn when sufficient equity in property. 4. Limit access to a once only - if people want to but/sell then they should have sufficient equity in property to stand alone.
  • Michael Kent | 12 Mar 2015, 02:56 PM Agree 0
    I also agree this is a great idea and I don't just think that because I am a broker.

    I heard a politician opposed to the idea saying "this is a terrible idea, the people in question won't have anything in super when they retire".

    Yeah well if they don't buy a property they certainly won't have anything!

    Besides you would create rules similar to the ones based around purchases in a SMSF or a reverse mortgage for seniors.

    You can only take out a maximum of $60,000 and you have to have at least $20,000 left over and you cannot sell the home for a minimum 5 years and so on.

    How else can young people get into the property market? the combined income is fine, servicing no issue the problem is they don't have 5% and costs mainly due to the fact the cost of living is so damn high they can only save $100pw

    If they need $50k to contribute it will take them 10yrs to save that money and how much do you think houses will be then?
  • annette saunders | 12 Mar 2015, 07:45 PM Agree 0
    I dont think it should just be first homebuyers. They get all the benefits already with FHOG etc. Maybe they should let SMSF funds lend as a shareholder of property for anyone and if you sold the percentage injected originally goes back to super. Or even have the SMSF fully borrow but allow you to live in and pay rent to SMSF to cover payments. People will die working these days before they access super!
  • SEQ Broker | 13 Mar 2015, 10:14 AM Agree 0
    Yep, Agree with FHB accessing super for purchase of property only. Along with legal requirement that should the property be executed, the super portion that made up the 5% deposit, goes back to the super fund. This makes the resi property effectively an investment.
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