The New South Wales premier, Dominic Perrottet, says it will be “difficult” for first-home buyers to enter Sydney’s housing market using the federal government’s proposed superannuation access policy.
While Perrottet, who has made addressing housing affordability a key priority for his government, said he welcomed the Coalition’s proposal to allow first-home buyers to access to up to $50,000 of their superannuation to buy a property, he acknowledged it would be of little help for many people.
“For some it will help, for others it will not,” he said.
Perrottet said he did not believe the government’s policy would drive up home prices. But with Sydney’s median home value above $1m, and the average superannuation balance for people being aged between 25 and 34 being about $41,000 for men and $31,000 for women, he agreed housing affordability would not be solved by allowing access to 40% of retirement savings.
“Yeah, it’s going to be difficult,” he said.
“And that’s why this proposal, whilst it’s welcome, can’t operate in isolation. I don’t believe one initiative is going to solve this problem.”
Perrottet last week used a press conference with the prime minister, Scott Morrison, to welcome Labor’s proposed home-equity scheme – which the Coalition has sought to criticise – saying he was open to “new ways of thinking” on housing affordability.
On Monday he gave the Coalition’s policy the same treatment, saying “we should at least give it a go and see what the take up is”.
“Superannuation is incredibly important, but let’s not forget the scheme was set up at a time when we had a much higher rate of home ownership in this country,” he said.
“The best way in which, particularly, young people grow their wealth is purchasing their first home. It makes a lot of sense I think, to do this in a measured way. We can’t have an Australia which can’t house its children.”
But he also called on both parties to make housing “above politics”, calling for both state and federal governments to embrace “fair dinkum” tax reform to address the issue.
“We need a suite of measures,” he said.
“We can’t just tackle this with one-out policy – Albanese one out, Morrison one out, NSW government one out. We have to work together to get a better outcome.”
Perrottet has long pushed for state stamp duty to be abolished in favour of an annual land tax, but the proposal has been slow-moving. On Monday he called stamp duty “the worst tax of all taxes”, but said NSW needed commonwealth help to reform it, given it contributes about $9bn to the state budget.
“It is the biggest impediment not just to first-home buyers getting into the property market, but also transferring their property,” he said, but added that “it funds our teachers, our nurses, our police officers”.
“States can’t embrace structural reform on their own. We need greater collaboration with the federal government.”
The government’s proposed scheme would allow people to access up to $50,000 of superannuation savings, or 40% of the total balance, for the purchase of a first home.
People would have to have saved a 5% deposit for the home already, and would have to return the invested amount as well as a share of capital gains back into their superannuation if the property was sold.
The policy has been criticised in a number of quarters, including the superannuation scheme’s architect, former Labor prime minister Paul Keating, who said the policy showed the Liberal party did not believe in the scheme.
“They object to working Australians having wealth in retirement independent of the government,” he said after the policy was announced.
