The main forms of lifetime savings for Australians are superannuation and owner-occupied housing – both are widely recognised as crucial contributors to quality of life in retirement. As at September 2023 superannuation assets totalled $3.6 trillion, while residential real estate totalled $9.7 trillion. However, worsening housing affordability presents a significant challenge for retirement outcomes.

Housing has become increasingly expensive – particularly over the past two decades. The ratio of the median house price to average annual full-time earnings has doubled over this period – from 3.7 to 7.4 times. International comparisons of the affordability of home purchase show that Australia is among the least affordable developed countries.

Unaffordable housing and declining levels of home ownership cannot be solved by superannuation early release, and could be exacerbated by it.

To improve outcomes, housing affordability must be tackled more holistically. There is arguably insufficient agreement and cohesiveness across federal, state and local government jurisdictions in addressing many of the substantive issues around housing affordability. A coordinated national approach is needed, with the ultimate objective of generating improvements in affordability. ASFA recommends the federal government commission a comprehensive, independent review of housing affordability, similar in nature to the Retirement Income Review, to establish a fact base and assess all relevant policy options.