A federal budget measure designed to help 10,000 single parents get into the property market will help just one in 100 families and does not go far enough, according to social services groups, Labor and a leading economist.
The Morrison government has announced a three-pronged housing affordability strategy that will expand the First Home Super Saver to allow up to $50,000 in contributions to that account for a first home deposit.
Prime Minister Scott Morrison and Housing Minister Michael Sukkar MP meet builders in the Melbourne suburb of Officer in February.Credit:Chris Hopkins
It will also expand the New Home Guarantee to allow 10,000 first home buyers to purchase a new home with a deposit of just five per cent, while over the next four years the Family Home Guarantee will let 10,000 single parent families put down a deposit of only two per cent. The government will guarantee the other 18 per cent of the deposit.
This third measure is expected to cost the federal budget just $300,000 and the government is understood to be open to expanding the program in the future.
Housing Minister Michael Sukkar said the primary hurdle for single parents with one income was pulling together a deposit and the new scheme “will enable single parents to jump that hurdle”.
“The Morrison government believes that all Australians who aspire to purchase a home should be given that opportunity. There are few more important people in our society than single parents,” he said.
“We are very pleased that the family home guarantee will help single parents - of which 80 per cent are women - to purchase their home.”
However, Labor’s housing spokesman Jason Clare criticised the policy, arguing it would “will help a little bit, but not enough” and calling the announcement “minimum help, maximum hype”.
“This isn’t the Mother’s Day present the government wants you to think it is. There are a million single parents around Australia and this will help just 2500 of them per year,” Mr Clare said.
Deloitte Access Economics director Chris Richardson said the policy was ”a useful measure to help a group that needs help in a hot housing market but it’s not make or break for the wider housing market”.
“Governments can’t solve this [rapidly rising house prices] and Australians are kidding themselves if they think can,” he said. “House prices are driven by interest rates and interest rates need to be nailed to the floor for years to come to drive unemployment down.”
Australian Council of Social Services chief executive Cassandra Goldie said the policy would “help a handful of single parents on modest middle incomes to get their foot in the door of an expensive housing market”.
But she said the announcement should be seen in the context of “what the government has done already to hit the economic security of single parents, mostly women, particularly those on low incomes”
“One in three single parents live below the poverty line now and as a result of cuts to social security we now have about 40 per cent of single parents and their children below the poverty,” Dr Goldie said.
“We are one of the richest countries in the world by median income, we can afford for every single parent and child to have enough to eat and to have a house to live in.”
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James Massola is political correspondent for the Sun-Herald and Sunday Age. He was previously south-east Asia correspondent in Jakarta and chief political correspondent. Before that he was political correspondent for the Australian Financial Review.
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