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Joe Hockey raises prospect of first home buyers using super to enter property market; Joe Hockey's plan for early access to super appeals to the young and the Greens
Topic Started: 6 Mar 2015, 06:31 PM (10,959 Views)
ThePauk
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It is a smoke screen. It would never get through the Senate and big Joe knows that. He is pushing this to 'appear' to side with FHB's.....
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stubby
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ThePauk
12 Mar 2015, 07:07 PM
It is a smoke screen. It would never get through the Senate ...
Why, exactly? You've said that twice now, without a shred of supporting evidence.
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stubby
13 Mar 2015, 12:21 AM
Why, exactly? You've said that twice now, without a shred of supporting evidence.
Senator Xenophon will vote for it: http://www.businessinsider.com.au/nick-xenophon-wants-the-rules-changed-so-young-home-buyers-can-use-retirement-savings-2014-7
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I thought people could already use their super for property purchases and to leverage off it too.

So if the young are not allowed to use their super at present, lets look at the effects of this if it were to change. Firstly ,the young dont have much super, sfa really whn compared to most property prices. The unfortunate thing is, with prices so inflated, all this record overbuilding, jobs losses and rents declines, these young are at risk of losing what little they have as prices decline. They could lose a lot more than the little they have put in.

Wheather this is just noise from big joe to pretend to be helping fhbs or wheather he is actually considering it, I really dont know. If he is serious, its just another desperate crab for cash via people superfunds being pumped into the system to attempt to maintain short term artificial growth at the expense of the long term. He has already put millions of peoples super at risk already by encouraging superfunds to leverage into this ponzi. The US never used the same mindless desperate measures we have used here to make things even more unsustainable for us in future. Stupidity on a grand scale.
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Shadow
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ThePauk
12 Mar 2015, 07:07 PM
It is a smoke screen. It would never get through the Senate and big Joe knows that. He is pushing this to 'appear' to side with FHB's.....
I think it has a fair chance of getting through. Don't forget that most politicians have IPs, and this is a vote winner too. Everyone wins (except crashnik housing bears).

The vocal minority will complain and make a lot of noise in polls and MSM comments, but they're still the minority.
Edited by Shadow, 13 Mar 2015, 08:40 AM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Shadow
13 Mar 2015, 08:39 AM
I think it has a fair chance of getting through. Don't forget that most politicians have IPs, and this is a vote winner too. Everyone wins (except crashnik housing bears).

The vocal minority will complain and make a lot of noise in polls and MSM comments, but they're still the minority.
Only a fool cannot see its just another destructive measure of not only the long term real estate market but the economy. Nothing more than a short sighted ,desperate attempt to spur growth in our dying economy and for the goverrnment to get theirs hands on more of peoples super and attempt to pump whats left into our dying system. Who will be held responsible when the prices start falling and these young lose what super they had aswell as their job that the government is destroying with no answers WHATSOEVER to adress this. Mind boggling.

Sounds like the last hoorah, as all the other tricks are running out of puff. Record low rates are and have done sfa for nearly ALL capitals over the last five years. And whats left wont make any difference ,with jobs, wages and rents tanking with this record amount of building going on. I think construction jobs in residential with peak around the second half on 2016, this is when the real fun steps up another gear, and when I expect rental declines will accelerate even more than now. Prices will be forced to follow when these people holding 2 3 4 ips paying interest only loans lose their job and simply cannot afford it. Falling rents wont help.

For every dollar people have we are trying to lend 20 dollars or more in debt.At 1% deposit it is 99 dollars dent for every dollar, an we had no deposit and 105% lvrs at one stage, what does that work out at. Even at half a percent deposit , thats 200 dollars lent for evry dollar. At 0.25% its 400 dollars for every dollar. And yet we had lower than these. The death of superfunds in an attempt to sustain a dying ponzi that is impossible to sustain, hence the sheer and utter desperation now being used or suggested.

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Lef-tee
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Quote:
 
I think it has a fair chance of getting through.


It's possible.

Quote:
 
Don't forget that most politicians have IPs


Definately.

Quote:
 
and this is a vote winner too


It's certainly a vote winner from those prepared to strip coming generations retirement savings and pocket them.

Quote:
 
Everyone wins (except crashnik housing bears).



I wouldn't describe further inflating the real debt to income ratio for those who do not yet own a win for them. The price will simply rise in response, before long nullifying the increased buying power and young people will end up getting nothing extra for a higher price and also likely end up with less retirement savings than they otherwise would have as well. Like an FHOG, it will simply all end up in the vendors pocket - they will benefit but first timers will be no better off after a while.

On the other hand, Stinkbug is probably correct in saying it would provide some economic stimulus.
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Glenn Stevens
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Lef-tee
13 Mar 2015, 01:33 PM
On the other hand, Stinkbug is probably correct in saying it would provide some economic stimulus.
Yes, we'd expect to see the velocity of money pick up if this proposal should ever pass the parliament.
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skamy
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Lef-tee
13 Mar 2015, 01:33 PM




It's certainly a vote winner from those prepared to strip coming generations retirement savings and pocket them.




I wouldn't describe further inflating the real debt to income ratio for those who do not yet own a win for them. The price will simply rise in response, before long nullifying the increased buying power and young people will end up getting nothing extra for a higher price and also likely end up with less retirement savings than they otherwise would have as well. Like an FHOG, it will simply all end up in the vendors pocket - they will benefit but first timers will be no better off after a while.

On the other hand, Stinkbug is probably correct in saying it would provide some economic stimulus.
On this topic I am in full agreement with you. In supply constrained markets this is just a wealth transfer from non home owners to home owners.
Edited by skamy, 13 Mar 2015, 02:12 PM.
Definition of a doom and gloomer from 1993
The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
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Poontang
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Shadow
13 Mar 2015, 08:39 AM
I think it has a fair chance of getting through. Don't forget that most politicians have IPs, and this is a vote winner too. Everyone wins (except crashnik housing bears).

The vocal minority will complain and make a lot of noise in polls and MSM comments, but they're still the minority.
I mostly agree with this. The everyone wins bit I'm not so sure.. Everyone wins in the short term for sure... Down the track it would definetly be an inflationary environment.


I still think if they are going to meddle with it, scrap the compulsory system all together.

Maybe the government could look at giving the bigger industry funds full banking licences to create more competition among the banks. (Most of the retail funds are affiliated with banking arms I believe)

Tax receipts for the country would rise immediatly as the 15% concessionary amount on the compulsory contributions would revert to the persons tax bracket.
Someone paying say $200pw Super now has $170pw going into their fund. Government gets $30pw. Scraping Super would make it more like $135pw income and $65pw tax

Tax income at a State and Federal level would rise due to the rise in spending access to the funds would create.

If governments were not so hopeless with money thay could actually make use of that increase in tax receipts to help offset the welfare issues down the track. Like I raised earlier, at the end of the day most people are good to very good at saving for the future over time. Their will always be the dead heads that can't or won't. Luckily they are in the minority.

There will always be those that are good at saving and investing and will do well with having their funds returned to them.
There are others that are a little more conservative with their funds and don't seek the bigger returns but also don't their money up against the wall.
There are the always going to be those that just can not save, the concept is foreign to them.


I hope the point I am trying to make is able to be read. I rewrote this 3 or 4 times before I posted it.


That much money being available immediatly I am guessing would be highly inflationary though.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
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