Dutton Pledges to Lower the Home Loan Borrowing Buffer
Opposition Leader Peter Dutton believes the current mortgage serviceability buffer is too high and would like to lower the current rate.
The home loan serviceability buffer is the additional amount banks add to interest rates when assessing whether an Australian can afford a loan.
The Coalition revealed plans on April 1 to ask the Australian Prudential Regulation Authority (APRA) to consider lowering this buffer.
APRA regulates banks, insurance companies, and superannuation funds in the financial services industry.
When asked by reporters how much a Dutton government would lower this buffer, Dutton said, “ultimately it’s a decision for APRA.”
Dutton said the Coalition’s position was to make sure that Australians could get into housing “as quick as possible.”
“Because I want young Australians to achieve the dream of home ownership again that they’ve lost, that’s vanished under the Albanese government,” Dutton told reporters at a press conference in Melbourne.
“We think the prudential arrangements that are in at the moment are too difficult for young homebuyers … I’m not going to be a prime minister, as Mr Albanese is, that is happy with a housing market where only those kids with a bank of mum and dad can buy a home. That’s not my dream for our country. ”
Dutton said his dream was to help every young Australian into a house to achieve the dream of home ownership and noted the Coalition would achieve this via multiple measures.
“Our $5 billion plan to help infrastructure, and that will create 500,000 new homes to put the two-year ban in place for foreign buyers, and also to make sure that we have a well-managed migration program and to make sure that we can help,” he said.
Shadow Minister for Housing Michael Sukkar said research shows nearly 40 percent of first-home buyers fail to secure finance due to serviceability buffers.
“APRA has said itself that these buffers are not appropriate for every lending decision,” he said on 2GB.
“It’s appropriate that these things get looked at on a regular basis because you can’t have a set and forget serviceability buffer when it’s meaning that people can’t get finance.”
Sukkar claimed Labor was very happy for people to “rent for their whole lives” but the Coalition wants people to have a realistic prospect of owning a home.
Labor’s $33 Billion For Housing
The recent budget, delivered by Treasurer Jim Chalmers, lifted total Labor commitments in housing to $33 billion.
Chalmers and Industry Minister Ed Husic said on March 25 that the key to more affordable housing was boosting supply. They said that for a generation, Australia had not built enough homes.
They said Labor would make it easier for first-home buyers to get into the market via an expansion of the Help to Buy scheme to 40,000 places.
The shared equity scheme helps buyers purchase a home with the government contributing up to 40 percent, reducing the required deposit to as little as 2 percent.
Albanese campaigned in Adelaide on April 1, aiming to sure up the seat of Boothby and target the seat of Sturt, currently held by the Liberal Party by a razor-thin margin of 0.5 percent. Boothby is held by the Labor Party with a 3.3 percent margin.
At the Flinders Medical Centre in Boothby, Albanese and Health Minister Mark Butler announced a plan for a $300 million healthcare service in Bedford Park.
