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Canberra Times
01-05-2025
- Business
- Canberra Times
Explainer: Labor's housing plan ahead of the election
The Short Version Labor is going big on housing ahead of the 2025 election - pledging 100,000 homes for first-home buyers, billions in new investment, rent support, crisis accommodation, and a crackdown on foreign investment. The goal? More homes, quicker builds, and better affordability for Australians. 100,000 homes just for first-home buyers Labor will invest $10 billion to build up to 100,000 new homes specifically for first-home buyers, locked away from property investors. These homes will be built near work and family, with support for land, construction, and enabling infrastructure. Universal 5% deposit access From 2026, the Home Guarantee Scheme opens up to all Australians buying their first home: No income caps No participant limits 5% deposit requirement nationwide. This means broader access to ownership, especially in high-demand urban areas. Smaller mortgages through Help to Buy Labor's Help to Buy shared equity scheme (starting late 2025) has the government cover up to 40% of a new home's cost (30% for existing homes). First-home buyers need a lower deposit Smaller mortgages mean lower repayments You can gradually buy out the government's stake over time Rent relief Labor has delivered a 45% increase in Commonwealth Rent Assistance - the biggest back-to-back increase in over 30 years, helping over 1 million households better manage rising rents. Supercharging housing supply Labor is driving the biggest housing build in Australian history with a $43 billion investment and a target of 1.2 million new homes over five years. Social and affordable housing push Through the Housing Australia Future Fund and other programs, Labor is delivering: 55,000 social and affordable homes (28,000 already in development) Prioritising housing for vulnerable women, children, veterans, and key workers Aiming to cut social housing waitlists Support for crisis accommodation Labor is investing a record $1.2 billion into new crisis and transitional housing-for older women, young Australians, and those escaping family violence-to provide safe, emergency shelter for the most vulnerable. More tradies, faster builds To meet ambitious targets, Labor is investing in: $78 million to qualify 6,000 tradies via a fast-tracked skills program Free TAFE and $10,000 incentives for new apprentices $54 million for prefab/modular home manufacturing $120 million to help states cut planning red tape Tightening foreign ownership rules Starting 1 April 2025, Labor is imposing a 2-year ban on foreign residents buying existing homes and cracking down on foreign land banking, to ensure more stock stays available for Australians. What do critics say? Some experts remain cautious. While the 100,000 homes promise is welcomed, questions remain on how quickly they can be delivered given land availability and planning hurdles. Others warn that expanded buyer support could drive up prices if supply doesn't scale fast enough. The shared equity model also raises long-term ownership questions for participants. The Final Pitch Labor is presenting a bold, multi-layered housing plan: mass construction, help for first-home buyers, rent relief, and supply chain reforms. Supporters see a serious national response to a decades-in-the-making crisis. Critics question the pace of delivery but agree housing is now at the heart of the 2025 election. SEE ALL: Labor's offical housing policy
Yahoo
22-04-2025
- Business
- Yahoo
Baby Boomers resist downsizing pressure as pensions put at risk: 'Something isn't right'
Older Australians, particularly wealthy ones, are reluctant to downsize despite coming under increasing pressure amid the country's housing crisis. There are sentimental reasons for holding on to an empty nest, but older Australians also grapple with supply shortages, costs associated with moving, and the possibility that a sale will impact their ability to access the Age Pension. The Retirement Living Council (RLC) has called for a rethink on the pension assets cap and Commonwealth Rent Assistance (CRA) eligibility to make it less financially burdensome for Baby Boomers to downsize. RLC's executive director, Daniel Gannon, said it's "absurd" to think these "relics of the past" could keep up with modern-day house prices and the cost of living. "Increases in Age Pension assets have failed to take into account the high level of asset wealth many older Australians now hold in their home,' he said. RELATED $300,000 pension warning to downsizing Baby Boomers from Services Australia Traffic controller responds to $200,000 pay 'rumour' as she reveals salary after 2 days of training Accountant's ATO warning as $5,000 expenses you can claim on tax without receipts revealed 'This has the unintended consequence of discouraging 'asset-rich, cash-poor' older Australians from 'rightsizing' into more suitable housing. 'When government policy locks older people in their homes, something isn't right."The current pension assets cap is $314,000, and Services Australia spokesperson Hank Jorgen explained to Yahoo Finance how it works. "So, let's say you sell your home for $1 million and you're planning to spend $700,000 on a new place— the leftover amount of $300,000 will be treated as an asset right away and counted under the asset test," he said. But over a 30-year period to 2024, median house prices in capital cities soared close to 600 per cent, however, the pension assets cap has only risen by less than 180 per cent for a single person. CRA eligibility stipulates you can't spend more than $252,000 on a home before your payment starts to be affected. If these two policies are addressed, the RLC believes 94,000 seniors would be able to access retirement village housing options, and it could free up more than 59,000 homes to younger families. The Council also said there could be reduced pressure on public housing, hospitals, and aged care facilities, and improve the quality of life for older Australians through age-appropriate living options. Australian Seniors has revealed 69 per cent of empty nesters have decided to hold onto their home even though they might not need the extra space. Those earning more than $200,000 per year or more were the least likely to want to move. Across the Baby Boomer generation, only 19 per cent have moved into a smaller property after their children moved out, while 13 per cent are considering it. South Australia was found to have the biggest contingent of Boomers remaining in the family home at 79 per cent. Yahoo Finance contributor David Koch said it's understandable why so many don't want to sell the empty nest. "Moving can be a hassle - especially when we have so much stuff," he wrote. "We have some of the biggest houses in the world and we keep buying stuff to fill the space. So, when it comes to downsizing, decluttering can be a sizeable effort. "Finding a new place can be extremely hard and, right now, supply of housing options falls way short of demand. "The government's failure to plan for our growing population has left many in the lurch. And then there's the cost [like paying stamp duty]." But Koch said pushing through "property paralysis" can give you the option of topping up your retirement fund. "Downsizers can make a contribution of up to $300,000 into their super when they downsize their home," he said. "It's a great boost, especially if you're over the age threshold for making voluntary contributions." It's not just cost that has stood in the way of some older Australians from shifting into a smaller home. "We're seeing the whole gamut of age ranges moving back in with the parents," ANU demographer Liz Allen told The Project. "And they're returning, not just with themselves and maybe a cat, but also with kiddos. So then we have this massive readjustment and renegotiation of what it is to be a parent and a grandparent." Finder found one in 10 have either moved back home with their parents or had an adult child return home recently to avoid soaring property and rent prices. Research consulting firm MyMavins also discovered up to 80 per cent of empty nesters are open to having their kids move back in with them. But, if a Baby Boomer decided to downsize to a one or two-bedroom home, this trend could be significantly curtailed. Providing additional incentives to older Australians could be key to helping release more stock into the housing market. ING Australia chief executive Melanie Evans suggested state governments could reduce the amount of stamp duty downsizers have to pay. 'You've got a transaction cost, and then I have $500,000 worth of capital that used to be in a tax-effective or tax-free environment,' she said. Nationals leader David Littleproud believed that idea has "merit". 'We do it for first homebuyers, why wouldn't we allow those who want to get out and downsize to have the stamp duty exemption,' he told Channel 7. Tax concessions for downsizers has previously been supported in NSW, however the proposals haven't progressed much further. Federal housing minister Clare O'Neill said stamp duty is a state-based issue and the government wouldn't be getting involved in that. While both Labor and the Coalition have put forward major housing policies ahead of the May 3 federal election, neither have addressed the issues faced by Baby Boomers wanting to in to access your portfolio
Daily Telegraph
21-04-2025
- Business
- Daily Telegraph
‘You can kiss your pension goodbye': Radical plan to remove Boomers
Imagine a world where your parents or grandparents live in a modest three or four-bedroom home that's soared in value thanks to the housing crisis. Or maybe you're living in this big family home where young children grew up but have since flown the nest. Considering this property was purchased 30 years ago, there's no mortgage. Now, you or your loved ones receive the Age Pension, but the family home is too big to manage, so it's time to 'rightsize' and explore more age-friendly living options. Unfortunately, Home Care packages aren't an alternative, with more than 80,000 people waiting for funding. This scenario isn't a stretch of the imagination – it's reality for older Australians. But now we run into trouble. While equity is tied up in this family home, it lives in a tax-free environment. However, if that property sells for $1.2m, hypothetically, that cash is now on the tax table. If $600,000 goes towards a home in a retirement village, a significant sum is left over. So you can fund your retirement, right? RELATED Radical plan to remove Boomers, unlock 60k homes The downsizing dilemma: Why SA's empty nesters won't budge NSW housing crisis fuelled by stubborn empty nesters Well, no. You can kiss your pension goodbye, or a big chunk of it at least. If you're a single pensioner, you've just rocketed past the $314,000 allowable assets cap. You've just been financially penalised for moving into a more manageable home or a close knit community. And, during a nationwide housing crisis, for freeing up a property for a younger family. Our new report, Removing rightsizing roadblocks: Homes for all Australians, shows there are more than 59,000 homes across the country that could become available to young families if the Age Pension cap was lifted to $550,000 and Commonwealth Rent Assistance (CRA) eligibility was reformed. CRA is wonderful – unless you're looking at a retirement village. Right now, pensioners who 'rightsize' into retirement villages can't spend more than $252,000 before losing eligibility. At that price, good luck despite village affordability. MORE NEWS: How Labor and LNP pitches to first home buyers compare Residents in other seniors' communities can access CRA, regardless of purchase price. It's senseless. Housing markets have totally transformed in recent years, yet the Age Pension assets test and CRA eligibility remain relics of the past. If older Australians 'rightsize' and governments want more homes freed up, this choice must come without penalty. Over a 30-year period from 1994 to 2024, capital city median house prices increased by almost 600 per cent, while allowable assets to receive a full Age Pension increased by less than 180 per cent for a single person. RELATED Two thirds of Victorian empty nester have no plans to sell The downsizing dilemma: Why Qld's empty nesters won't budge Right-size empty nester homes help ease property crunch In 1997, the CRA cap covered 55 per cent of the median house price, but today just 26 per cent. If it kept pace, it would be about $550,000 – incidentally the national average price of a two bedroom retirement unit – rather than $252,000. Good policy is never set in stone – it adapts. Bad policy remains frozen. That's why the Age Pension assets test and CRA must evolve – and Australia can support healthier and happier retirees, provide more housing for families, and reduce strain on aged and healthcare systems. Right policy, right time. – By Daniel Gannon, executive director of the Retirement Living Council.
Mercury
21-04-2025
- Business
- Mercury
‘You can kiss your pension goodbye': Radical plan to remove Boomers
Imagine a world where your parents or grandparents live in a modest three or four-bedroom home that's soared in value thanks to the housing crisis. Or maybe you're living in this big family home where young children grew up but have since flown the nest. Considering this property was purchased 30 years ago, there's no mortgage. Now, you or your loved ones receive the Age Pension, but the family home is too big to manage, so it's time to 'rightsize' and explore more age-friendly living options. Unfortunately, Home Care packages aren't an alternative, with more than 80,000 people waiting for funding. This scenario isn't a stretch of the imagination – it's reality for older Australians. But now we run into trouble. While equity is tied up in this family home, it lives in a tax-free environment. However, if that property sells for $1.2m, hypothetically, that cash is now on the tax table. If $600,000 goes towards a home in a retirement village, a significant sum is left over. So you can fund your retirement, right? RELATED Radical plan to remove Boomers, unlock 60k homes The downsizing dilemma: Why SA's empty nesters won't budge NSW housing crisis fuelled by stubborn empty nesters Well, no. You can kiss your pension goodbye, or a big chunk of it at least. If you're a single pensioner, you've just rocketed past the $314,000 allowable assets cap. You've just been financially penalised for moving into a more manageable home or a close knit community. And, during a nationwide housing crisis, for freeing up a property for a younger family. Our new report, Removing rightsizing roadblocks: Homes for all Australians, shows there are more than 59,000 homes across the country that could become available to young families if the Age Pension cap was lifted to $550,000 and Commonwealth Rent Assistance (CRA) eligibility was reformed. CRA is wonderful – unless you're looking at a retirement village. Right now, pensioners who 'rightsize' into retirement villages can't spend more than $252,000 before losing eligibility. At that price, good luck despite village affordability. MORE NEWS: How Labor and LNP pitches to first home buyers compare Residents in other seniors' communities can access CRA, regardless of purchase price. It's senseless. Housing markets have totally transformed in recent years, yet the Age Pension assets test and CRA eligibility remain relics of the past. If older Australians 'rightsize' and governments want more homes freed up, this choice must come without penalty. Over a 30-year period from 1994 to 2024, capital city median house prices increased by almost 600 per cent, while allowable assets to receive a full Age Pension increased by less than 180 per cent for a single person. RELATED Two thirds of Victorian empty nester have no plans to sell The downsizing dilemma: Why Qld's empty nesters won't budge Right-size empty nester homes help ease property crunch In 1997, the CRA cap covered 55 per cent of the median house price, but today just 26 per cent. If it kept pace, it would be about $550,000 – incidentally the national average price of a two bedroom retirement unit – rather than $252,000. Good policy is never set in stone – it adapts. Bad policy remains frozen. That's why the Age Pension assets test and CRA must evolve – and Australia can support healthier and happier retirees, provide more housing for families, and reduce strain on aged and healthcare systems. Right policy, right time. – By Daniel Gannon, executive director of the Retirement Living Council.
Yahoo
12-02-2025
- Business
- Yahoo
Controversy over $280 Centrelink cash boost for struggling pensioners 'set to get worse'
Significant concerns have been raised about the number of retired Australians struggling in their twilight years as they rent. The Grattan Institute has found two in three older renters - like pensioner Debra Basham - are living in poverty, with the crisis "set to get worse" if the issue isn't addressed. The 67-year-old has missed meals as she doesn't have enough money to cover her bills and feels in a constant state of "struggle". The Grattan Institute has called for another increase to Commonwealth Rent Assistance (CRA),which last went up in September. However, NSW Tenants Union CEO Leo Patterson Ross told Yahoo Finance another cash boost won't solve the problem if wider issues in the rental market are not tackled. "Unless you do something about rent prices, you're always chasing increasing rents," he said. "A 10 per cent increase in Rent Assistance is kind of helpful, but if rent went up 20 per cent, you're still behind. "You also have to be already receiving Centrelink payments and already be in a home to be eligible. So, that means there's a whole bunch of people who should be getting more support but aren't." RELATED Cash warning for 4.2 million retirees over impending RBA interest rate cut Rare $1 coin worth up to $350: 'Lucky to find one' NAB, Commonwealth Bank cut term deposit interest rates in warning signal for Aussies: 'Act quickly' More than 165,000 Australians aged between 55-64 receive Commonwealth Rent Assistance. Rent has risen dramatically across all capital cities over the last four years, according to Domain. Weekly rent in Sydney has risen by up to $540, in Brisbane it's gone up by $410, while Perth has seen a $390 jump. While this has stabilised, experts have said prices are not set to drop. The CRA last increased in September by 10 per cent thanks to a measure contained in the 2024-25 Federal Budget, which gave single people between $12 to $19 extra per fortnight. The issue for pensioners is that those who take the Centrelink payment have faced an increase in rent of 1.5 times the maximum CRA payment rate since 2001, the Grattan report found."Even after these increases, a single retiree who relies solely on income support can afford to rent just 4 per cent of one-bedroom homes in Sydney, 13 per cent in Brisbane, and 14 per cent in Melbourne," it said. "Australia is failing too many retirees who rent. Only a further substantial boost to Rent Assistance can ensure that all Australians get the dignified retirement they deserve." Ross told Yahoo Finance that 10-15 per cent increases are nowhere near enough. "Most of the calls from the community and from Grattan are at more like the 40 to 50 per cent level. And so there's definitely scope for rent assistance to rise to that level," he said. Boosting CRA by up by 50 per cent would take the maximum rate up by $53 per week or $2,750 per year for singles, and $40 per week or $2,080 per year for couples. Grattan said this would allow retirees to afford up to $350 per week on rent, while retired couples could afford $390 per week, which would be enough to rent the cheapest 25 per cent of all one or two-bedroom homes in Aussie capital cities. These increases, which would also help everyone on CRA, not just retirees, would cost taxpayers $2 billion per year. The housing crisis in Australia has forced many Australians to rent as they can not afford their mortgage in retirement, or could not get into the market at all. Women aged over 55 are of particular risk of homelessness in Australia, with many in precarious rental situations. Some have lost their family home in separation after being primary carers for children, diminishing their earning and ability to build a superannuation nest egg. Basham retired from her job as a cleaner last year and has since found it difficult to cover her bills. "You just struggle," she told The Project. "I've got animals, I feed them first, and if I've got nothing left, then I go without. "If I've got a slice of bread, I'll just have a slice of bread for tea." National Seniors Association CEO, Chris Grice, told Yahoo Finance that too many retirees are facing uncertain futures due to this trend. 'Housing security and affordability is a huge concern for many older Australians, with an increasing number of older people unable to afford their own home and relying on the precarious and competitive rental market," he said. The association is not only calling for the rate of CRA to be lifted but for its indexation to be tied to changes in rental prices, rather than overall inflation. The CRA program is only accessible to Australians receiving the following social security payments: ABSTUDY - Living Allowance Age Pension Austudy Farm Household Allowance JobSeeker Payment Special Benefit Youth Allowance To be eligible for assistance, you need to meet minimum rent payment requirements. Situations also change depending on how many people you live with and if you have any dependants. The maximum fortnightly payment for a single person living alone is $188.20 every two weeks, or $125.47 for a single person in a share house. You can find the requirements in to access your portfolio
