SMC fires first shot in election super for housing debate

The industry funds-backed Super Members Council (SMC) has fired an early shot in the looming Federal Election policy debate over super for housing, pointing to New Zealand as a prime example of what can go wrong.

The SMC described New Zealand’s super for a house scheme as “a cautionary tale for Australia”, claiming that new research had confirmed that Kiwi house prices had spiked and home ownership rates had fallen after the policy was introduced.

“The New Zealand lived experience shows a policy to bust open super for housing would not help first home buyers get into the market in Australia – this real-world example shows home prices rose even faster and homeownership rates fell,” the SMC statement said.

The SMC said its examination of detailed evidence from New Zealand showed that since the KiwiSaver HomeStart scheme started in 2010:

• house prices in New Zealand spiked upwards in-line with withdrawals from KiwiSaver
• home ownership rates fell overall, and dropped sharply for people in their 30s,
• Mortgages steeply increased, as did debt levels among first home buyers

“Since the policy’s introduction there, house prices in New Zealand have risen 134% from June 2010-June 2024, more than in the previous two decades and 1.5 times faster than house prices in Australia,” the SMC statement said.

It said the policy had not worked with a smaller share of New Zealanders becoming homeowners, particularly among first home buyers.

SMC chief executive, Misha Schubert said Australia should heed New Zealand’s cautionary tale and not make the same policy mistake.

“If you want to see further rises in house prices and falling home ownership rates – New Zealand shows introducing a super for a house policy leads in that direction,” she said.