Broker industry throws support behind first homebuyer plan

by Adam Smith01 Aug 2014
The industry has rallied behind a plan to allow first homebuyers to access their superannuation for a deposit.

HomeStart chief executive John Oliver told a Senate Economics References Committee meeting this week that Australia should implement a scheme similar to one in Canada which allows Canadian first homebuyers to access up to $25,000 for a deposit, and high-profile independent Senator Nick Xenophon has said he will move to support the idea. Now mortgage broking industry figures have applauded the plan.

Mortgage Choice chief executive Michael Russell said the franchise brokerage had long called for a similar scheme in which first homebuyers could access their super for a housing deposit, reducing the need for LMI.

"While Lenders Mortgage Insurance has a crucial role to play in assisting first homebuyers into the property market, if the premium can be reduced by lowering the Loan to valuation ratio, then this would seem to be in the best interests of buyers. First homebuyers should be allowed to invest part of their super in their own bricks and mortar,” Russell said.

Russell said the scheme should be put in place with the stipulation that the money will be reimbursed to the buyer's super account either at the sale of the property or within 15 years, whichever comes first.

1300HomeLoan managing director John Kolenda also voiced his support for the plan, saying it could be a boon to first time buyers, provided the proper stipulations were put in place.

The plan from Senator Xenophon deserves consideration and they can set parameters around it such as a maximum withdrawal from a super fund of $25,000," he said.

Kolenda predicted that the plan could benefit not only the housing industry, but the superannuation system as well.

“If first time buyers are allowed to access their super for a home loan deposit you might actually see people contributing more money into their fund, which will be beneficial to the superannuation sector.”


  • by Timbo2 1/08/2014 10:12:57 AM

    Nice thought, but the problem remains as it would not be considered as genuine savings by the LMI's. It would be seen as a gift and would need to be held for 3 months, which I suppose is better than not having any deposit at all.

  • by Incognito 1/08/2014 10:17:21 AM

    Really? I don't support it.

    FH buyers don't want to use super to get a damn house. They want investors trimmed from gobbling up all the stock.

    How about phasing out negative gearing (on existing homes) and addressing the budget crisis and the housing crisis at the same time.

  • by Steve McClure 1/08/2014 10:32:04 AM

    2 people do not constitute a "rallying of the industry". Closer examination of the number of new buyers that this scheme would generate, implications re super accumulation, servicing, the relativity of house prices, inflationary issues and full consideration of alternative measures such as changing the FHOG eligibility.

    Not opposed to it as long as it's the best way forward. If the aim is to get more first home buyers into the market, is diminishing super for $25K the best way to responsibly achieve it? What impact would it have given prices of our capital city markets?