This week’s announcement that first home buyers could use up to $50,000 of their Superannuation to buy a house has immediately added $50,000 to the price of a house.
As reported in the Guardian in Greg Jericho’s article house prices became separated from wages and inflation when the Howard government introduced the 50% Capital Gains Tax discount which, combined with Negative Gearing, sent the price of houses surging. They’ve not stopped.
A housing policy that fails to address this simple fact is not credible. Our housing affordability crisis cannot be solved by asking young Australians to raid their meagre super in order to further fuel this structural flaw.
The Australian Democrats are proposing halving the CGT discount to 25% to take the heat out of the housing market. It is time to address the structural design of our taxation and housing systems and end the continued overinflation of house prices.