Susan Templeman (Macquarie, Australian Labor Party) Share this | Hansard source

My 26-year-old daughter moved house yesterday. She and her flatmates have been through the hunt for a property in Sydney's inner west. They found one, were given verbal approval and then were gazumped when someone offered $150 more a week. They found another one, got approved and then had to find replacement tenants for their current home, which young people reckon is easier than trying to go through the tedious bond recovery progress. These rental properties are not bargains. They take a huge chunk of weekly earnings even when shared between as many people as can comfortably fit into a property.

The owners of these properties are not looking to provide a long-term home for anyone most of the time. They're looking to return a profit or benefit from negative gearing and make a capital gain, which hasn't been hard to do in the Sydney market. This is my daughter's fourth house in as many years, and her story is pretty typical of what young people from my electorate of Macquarie who gravitate to the inner west for study or work go through.

So what? They're young—they can do it. In fact, many of us would have had a similar nomadic experience in our 20s as we got through study and our first jobs. But unfortunately the likelihood is that this pattern will be repeated throughout my daughter's 30s, 40s and even 50s, given how unaffordable homeownership is becoming. In fact, far fewer people in their 30s, 40s or 50s own their own home, in spite of having steady relationships and steady jobs. Women nearing retirement who don't own a home are in an extremely precarious position.

The past five years have seen national home prices rise by 19 per cent while household incomes have risen by half that, at 9.2 per cent. Right now we're seeing the lowest wage growth on record. The 13th annual Demographia international housing affordability survey: 2017 shows that all but seven of 54 Australian markets that were studied are rated as either seriously unaffordable or severely unaffordable. There are the options of Karratha, Kalgoorlie, Gladstone or Port Hedland, which are rated as affordable, but they won't necessarily match up with people's employment options. By contrast, in the early 1980s every market except Sydney was rated affordable, which is actually how I came to live in the Blue Mountains on Sydney's fringe.

The 2016 census confirms that over the last decade home ownership rates have fallen significantly for all age brackets below the age of 55. Prices in my electorate have certainly risen fast. Analysis by the Grattan Institute shows that this will lead to generations of Australians becoming permanent renters. A report in August this year from the Committee for Economic Development of Australia called for 10-year or five-year lease agreements, acknowledging that an increasing percentage of Australians will become lifetime renters. The report also warns that the affordability crisis is likely to continue for another 40 years, unless there are major changes. That means it's not only the generations of Australians who are currently under 55, but many more to come, who will struggle to save enough to access the housing market, and the dream of home ownership may remain elusive.

So, this is the issue we face, and here we have a scheme by the government that purports to be trying to improve the affordability issue for first home buyers. But, without addressing the key driver of demand—namely, the investors competing in the market—it is doomed. Australian Bureau of Statistics data shows that investors make up 47 per cent of mortgage demand nationally, and in New South Wales it's 55 per cent. So, in New South Wales, a home is more likely to sell to an investor than an owner-occupier.

What's more, the measures being proposed by the government undermine the integrity of the superannuation system. It's a bit like building a new road: they simply shift the problem to another stage of the journey—in this case, retirement. I remember the first time in this place that I heard about superannuation. It was the early 1980s—in fact, it was in the old parliament. As a 21-year-old I had just begun in the Canberra press gallery. The then Prime Minister, Bob Hawke, his Treasurer and the ACTU leader, Bill Kelty, talked about employers paying three per cent of wages into superannuation. I don't think we'd even shortened the word superannuation to 'super' at that stage. I'm not really sure I cared about it, and that's the problem. When you're in your early 20s, and just starting out in a job, the least of your worries is how you will fund your retirement. But Prime Minister Keating recognised that we needed to talk about super. In 1991, he proposed a retirement income scheme where the age pension was augmented by a privately funded and employer related national scheme.

Superannuation accounts are supposed to be secured savings for generating retirement income, and not for use by governments for other reasons. This government is contradicting its own stated primary objectives for superannuation—that is, to provide income in retirement. The problem with this legislation is not just the exemption it is creating for first home buyers but the precedence it sets for many other possible exemptions. How many are you going to make? Will the government let someone access their super when their house burns down and they are under-insured, when they want to upgrade to a new home, or when they want a pool? This so-called First Home Super Saver Scheme will actually work to undermine Australia's world-class superannuation system.

If it's about encouraging young people to save, you can create other incentives for them to save for their first home, if you think that's a game-changer. But what I hear from young people is that they are barely able to cover their costs, let alone put away any savings. According to experts, including National Shelter, super saver accounts will make the housing crisis worse by pushing up prices. So this on its own is not going to help with housing affordability, and may make things worse.

As for the other measures in the bill, let's look at the measure about contributing the proceeds of the sale of a home to superannuation. I have no problem with the principle of helping people to downsize. Large family homes designed for children, and then visiting grandchildren, may not suit people's lifestyles and they may want to downsize. If this measure were split from the First Home Super Saver Scheme, we would be open to supporting it.

However, does it really reduce pressure on housing affordability? Labor piloted this idea in 2013-14, trialling a means test exemption for age pension recipients who downsized their family home. Up to $200,000 would have been put in a fund exempt from the pensions means test for up to 10 years. Sadly, this government scrapped that pilot program, so we don't really have a number of years of watching it to see what the impact might have been. And this version 2.0 has no data from Treasury to support its impact on housing supply—not a piece of evidence to show that it will make a difference. Industry Super Australia says the measure will be used by self-funded retirees rather than age or veteran pensioners because there are no changes to the pension income or assets test, and the numbers won't add up for people who, right now, would qualify for a pension. Typical of this government—a half-baked idea, poorly executed.

When it comes to tackling housing affordability, there is no doubt that there is urgency to act. If we want our current generations, who are looking at housing prices rising, to aspire to have a home, then this parliament does need to do something. But, if the government doesn't act on changes to capital gains tax and negative gearing, it is just going to make the situation worse. It really can't run away from that as a general principle. I'm reminded—and I think this bears repeating—that John Daley from the Grattan Institute described it really well when he said, with regard to this package of measures that the government has put up, 'You'll need a scanning electron microscope to see an impact on prices.' I gather that they help you zoom in and look at really tiny changes. That's what needed to see whether this would make any difference. Mr Daley says you won't see a discernible difference in the number of young people that buy a house. That's a tragedy, because we have a responsibility to make sure that every 26-year-old who moved house yesterday, no matter where there are in this country, can aspire to own their own home.

Many of us would appreciate the benefits of home ownership: the security of knowing that you actually have a place to age in and the security of knowing that you don't have to have three-monthly inspections where someone comes along and tells you whether you've been keeping the house neat enough. These are the sorts of invasions that people face. A common situation for so many renters in New South Wales is that you can't have pets in your home, unlike the situation under the Victorian government— (Time expired)

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