COVID BUDGET 2021 ENCOURAGES DOWNSIZING TO FREE UP FAMILY HOMES

Australians nearing retirement will be encouraged to downsize their homes to free up more houses for younger families in a pandemic budget that also aims to help more people into home ownership.

Tuesday’s big-spending and jobs-focused federal budget contains help for single parents and more first-home buyers to get into Australia’s hot property market, as well as tax relief for 10.2 million low and middle income earners.

The biggest housing initiative in the budget is aimed at encouraging more Australians nearing retirement to downsize from the family home by extending access to a superannuation contribution scheme.

“We will allow those aged over 60 to contribute up to $300,000 into their superannuation if they downsize their home, freeing up more housing stock for younger families,” Treasurer Josh Frydenberg said.

Realestate.com.au economist Anne Flaherty said the change could be useful in addressing the problem of housing affordability as property prices surge.

“Demand has been outstripping supply. Anything that can help to support an increase in supply should have a positive impact on affordability,” Ms Flaherty said.

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