Xenophon first home buyer super scheme supported by Mortgage Choice

Mortgage Choice has welcomed Senator Nick Xenophon’s plan to introduce legislative changes to allow first home buyers to access their superannuation savings for a house deposit. 

Mortgage Choice chief executive officer Michael Russell said he believed the proposal would help make a difference to thousands of Australians each year.

The changes to the Superannuation Act 1976 will be debated during the spring session of parliament.

The proposed changes are similar to a scheme, called the Home Buyers’ Plan operating in Canada.

Under the Canadian scheme, home buyers can access up to $25,000 for a first home.

Allowing these buyers to jump onto the property ladder sooner rather than later, the amount borrowed is then required to be paid back into the super fund within 15 years.

Michael Russell advocated the Xenophon scheme as likely to reduce the need for lenders mortgage insurance.

“While lenders mortgage insurance has a crucial role to play in assisting first home buyers 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," Michael Russell said.

“First home buyers should be allowed to invest part of their super in their own bricks and mortar.”

Mr Russell said the money ought be reimbursed into the homeowners' super account either at the sale of the property or within 15 years – whichever comes first -  and include gains based on an appropriate index.