Younger Aussies would be better off today if they had been able to dip into their super savings to get onto the property ladder a decade ago, says federal opposition leader Peter Dutton. 

The Coalition’s super for housing plan – which would allow homebuyers to withdraw up to 40% of their super savings to buy their first home – has been under fire amid fears it would drive home prices higher and hurt retirement savings.  

But Mr Dutton defended his major housing plan at the Property Council conference on Thursday, as the housing affordability debate heats up with the federal election less than a year away.  

“Had you allowed people to do that 10 years ago... young people would be in a much better net position than they could ever have imagined,” Mr Dutton told the conference.  

“The uplift of the asset value over brisk years would have been something that would have got them into housing, would have rewarded them into retirement, and would have provided a great boost to their superannuation.” 

The super for housing plan has been loudly rejected by the government, Greens, economists and superannuation funds.  

Economist Saul Eslake has warned using super to buy a house would make homes more expensive, reduce retirement incomes and lead to a significant long-term cost to the federal budget.  

Federal opposition leader Peter Dutton said residential housing is an asset class for people to invest in. Picture: Supplied

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“If super for housing was introduced, it would be one of the worst public policy decisions in the last six decades,” Mr Eslake said.  

At the conference, demographer Simon Kuestenmacher also cautioned against the super for housing plan and said such demand-side policies drove home prices higher.  

“First-home buyer grants… are a waste of public money, [they] drive up house prices and it actually works actively against the young people that are arguably meant to be helped by this,” Mr Kuestenmacher said. 

“The only policy dumber than first-home buyer grants is super for housing because that's where you waste your own money - at least waste public money on dumb policies.”  

Under the super for housing plan, first-homebuyers would be able to withdraw as much as 40% of their super to help buy a home. Picture: Getty

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Under the plan, home buyers would be able to withdraw up to 40% of their super savings to a maximum of $50,000 to buy a home.  

Mr Dutton said his plan would have protections in place to ensure home buyers who dipped into their savings eventually returned the money back to their super savings.  

“I think it's a bad idea if there is not a requirement to repatriate the initial withdrawal with the uplift once the asset has been disposed of,” he said.  

“I think that would be a terrible idea because it wouldn't allow that investment to go back into super, as you would do if you sold a commercial property out of a self-managed super fund, or as you would do if you sold equities out of a self-managed super fund, you would be required to put that money back in.” 

“In the end, residential housing is another asset class for people to invest in.  

“People can do that through different vehicles, through their self-managed super funds, or indeed, many industry super funds doing exactly the same through a direct investment or through another vehicle.”   

“Why should people lose the opportunity, at least the option, to be able to use their own money that they have saved, that they have put away, that they've invested wisely.”  

It comes as housing and cost of living dominate the national agenda, with an election likely to be held in the first half of next year.  

Economist Saul Eslake said using super to help buy a home would make home prices more expensive and hurt retirement incomes. Picture: Richard Jupe

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The pressure has been on the federal government to ease the housing crisis, as housing affordability deteriorates, and the rental markets remain challenging across the country.  

The Albanese government has been focused on supercharging home building and increasing housing supply to deliver relief to homebuyers and renters, however home building has been sluggish and can take years to deliver homes from planning through to completion even in good times.  

While the government has focused on improving housing supply, its flagship plan to help home buyers directly remains stuck in Canberra.  

The Coalition and the Greens continue to oppose the government’s Help to Buy shared equity scheme, aimed at helping home buyers get into the property market by taking an equity stake in their home.