It's a tough time to buy your first home. Housing affordability is near record lows, and plenty of hard-working Australians are stuck renting while prices run away from their savings.
Two very different ideas keep coming up. One lets young buyers use their own super for a deposit. The other, which I've put forward on Constructor, uses retirees' wealth to fund new affordable homes. This post compares the two so you can make up your own mind.
To be clear up front: the first is a published policy paper. The second is my own proposal, not government policy.
What the Super for Housing report proposes
In March 2025, the Centre for Independent Studies (CIS) published Super for Housing by economists Matthew Taylor and Peter Tulip. The core idea is simple: let first-home buyers use part of their superannuation to get into a home, instead of locking it all away until retirement.
That goes much further than what exists now. The First Home Super Saver (FHSS) scheme only lets you make extra voluntary contributions into super, taxed at the concessional rate, and later withdraw them for a deposit. Your existing compulsory super stays untouched.
The report's modelling suggests letting buyers use their super could:
- Lift the home ownership rate from about 66% to 70%.
- Let the median buyer purchase a home about three years earlier.
- Reduce super balances at retirement, by around $11,000 in its central scenario.
The authors argue that owning your home is itself retirement security, since outright owners need far less income in retirement than renters.
Strengths of using super
- Gets people in sooner. The deposit is the biggest hurdle for first-home buyers. Using super could cut years off the wait.
- Tax-effective saving. Money in super is generally taxed at 15%, lower than most people's marginal tax rate, so savings build faster.
- Smaller loan. A bigger deposit can mean a smaller mortgage and may help you avoid lenders mortgage insurance.
- More work for builders. More buyers means more demand for new homes, which supports construction jobs.
Weaknesses of using super
- Less money for retirement. Even small withdrawals compound over decades. Less super can also mean more reliance on the age pension.
- It's a bet on prices. People using super for a deposit are betting that house prices keep rising. If they don't, their retirement savings take the hit.
- Prices could rise. Give buyers more money without more homes and prices go up. The affordability problem can end up worse.
- Admin and red tape. Funds, the ATO and APRA would need new rules, checks and reporting.
- It doesn't add supply. It helps people compete for the homes we have. It doesn't build new ones or fix slow land release.
What Boomer Bonds are
Anthony Painter
In this post we outline "Boomer Bonds" as a way to fund supply side and increase housing affordability. In times of crisis innovation is needed to shine a light forward and beyond. "To infinity & beyond" 'with boomer bonds' - as said, in part, by Buzz Lightyear
Boomer Bonds tap the wealth of baby boomers, roughly those born between 1946 and 1964. This generation owns a big share of the country's property and savings, but many are nearing or in retirement with few safe, reliable places to invest.
Here's how they'd work:
- Investors. Retirees and pre-retirees buy bonds offering a fixed, predictable return.
- Funds raised. The money goes directly into building affordable homes for essential workers and low to middle income earners.
- Returns. Bondholders are paid from rental income, backed by real property. A government guarantee could make them safer still.
The point is to use savings that already exist to build new homes, without dipping into younger people's retirement money.
Strengths of Boomer Bonds
- A safe investment for retirees. Steady returns without taking big risks.
- Adds supply. Every dollar goes into new affordable homes, which is the actual shortage.
- Community benefit. More affordable housing means more stability and less inequality.
- Wealth working across generations. Older Australians' savings build homes rather than bidding up prices on existing ones.
Weaknesses of Boomer Bonds
- Needs investors. If retirees don't buy in, projects go unfunded.
- Setup is complex. It needs clear rules on how bonds are issued, how money is spent and which projects qualify.
- Liquidity and return. Retirees often want to access their money easily or earn more. The bonds have to strike that balance.
How each affects different people
First-home buyers
- Super access: a faster path to a deposit, at the cost of retirement savings and possibly higher prices.
- Boomer Bonds: no cash in hand, but more affordable homes and steadier prices over time.
Retirees
- Super access: not aimed at them. If it pushes prices up, downsizing could cost more.
- Boomer Bonds: built for them, provided the returns and access to funds are right.
Everyone else
- Super access: risk of higher prices and more pressure on the pension.
- Boomer Bonds: more homes and construction jobs, if enough people invest and the scheme is well run.
What each would need from government
Super access needs changes to super law setting out who can withdraw, how much and for what, plus tax rules for withdrawals and ATO oversight to prevent misuse.
Boomer Bonds need a framework for issuing the bonds, rules on which projects qualify, transparent reporting and probably a government guarantee to give investors confidence.
Get the details wrong on either and you can make the market worse, not better.
My take: cautious support, supply first
The CIS report is right that the deposit is a real barrier, and I'm open to the idea. But I'm not convinced the safeguards for retirement savings are enough. People desperate to buy a home won't always think about what they'll live on at 70.
The bigger issue is that super access boosts buying power without adding a single home. If we don't build more, prices rise and the benefit disappears.
Boomer Bonds go after supply, which is the root of the problem. They're not a silver bullet either, but they point in the right direction. Whatever policymakers choose, the priority has to be policies that increase housing supply directly, backed by strong rules.
Quick answers
What is the First Home Super Saver scheme?
An existing scheme that lets first-home buyers make voluntary contributions to super, taxed at the concessional rate, and withdraw them later for a deposit.
Would using super for housing affect my retirement?
Yes. Money taken out early misses out on decades of compounding, so your balance at retirement would be lower.
Could it push prices up?
That's the main risk. More buyer money with no extra homes tends to lift prices.
Are Boomer Bonds government-backed?
They could be, depending on how the scheme is designed. A guarantee would make them safer and more attractive.
Can either fix affordability on its own?
No. Neither works without more homes being built, faster land release and more efficient construction.
Further reading
Step-by-Step Guide to Residential Building in AustraliaThis guide provides a detailed overview of the residential building process in Australia, highlighting key stages from the initial deposit to the final handover. It offers insights into contract stage claims and the elements within each stage.If you're building, our quality management checklists are listed on the Checklists page. C1 Before Buying Land is free.
