Daily Buzz: Wednesday, 27 March

PropertyBuzz, your daily dose of property news.

Superannuation struck out as a solution to help home ownership, shrinkflation hits the housing sector, and Australians predict property prices to rise

Welcome to Property Buzz! I’m Juliet Helmke. Today is Wednesday, 27 March.

– New research conducted by the Association of Superannuation Funds of Australia has found that allowing early access to super for housing would not make home ownership more attainable for the majority of aspiring first-home buyers, despite a policy proposal from the shadow Treasurer to allow the practice.

– Examining a sample of 300,000 taxpayers the association first assessed the distribution of super balances for prospective first-home buyers aged 25 to 34 across Australia’s major capital cities and then compared that against the housing deposit required for a median priced house or unit

– The data indicated that no one in this age group in Sydney, whether single or in a couple, could raise enough money for the deposit on an average house or unit by using their super alone, even if they drained their retirement savings. In Melbourne, the news was similar.

– Ultimately, the body determined that accessing superannuation is not the silver bullet to solving Australia’s housing crisis, with the policy more likely to have complex impacts, including raising house prices in some markets.

– And the cost of living crisis has hit Australian homes in an unexpected way, with higher construction costs reportedly resulting in a reduction in the size of kitchens and bathrooms in new builds and renovations, leading the Housing Industry Association to declare shrinkflation an active determinant in the formation of Australian dwellings.

– HIA reported that the average number of bathrooms per new home built in 2023 has decreased to two, down from 2.6 in the previous year. Meanwhile, while kitchens grew in size over the pandemic with more Aussies spending time at home, that trend is similarly being curtailed by cost.

– With construction expected stabilise this year, however, HIA expects to see renovators and home builders even out in their bathroom and kitchen needs.

– And finally, Westpac’s Consumer Sentiment Index has indicated that 70 per cent of consumers expect house prices to surge in the near future, with many indicating they believe now is the right time to purchase a property

– The bank’s ‘time to buy a dwelling’ index rose by almost 5 per cent to 77.8, a fifteen-month high, with buyer sentiment stronger in Victoria due to a drop in Melbourne property prices.

–  Even so, only 8.4 per cent of respondents said they considered real estate a wise place for savings, with most preferring ‘safe-haven’ options like paying down debt or banking.

That’s all from Property Buzz for today. 

See you again tomorrow, 28 March, for your daily dose of Property Buzz.

If you like this episode, show your support by rating us or leaving a review on Apple Podcasts and by following Property Buzz on social media: YouTube, Instagram and TikTok.