Housing affordability issues could be helped by allowing renters to buy without a deposit, Federal MP says
Updated
A Federal Government MP has devised a "creative" solution to the housing affordability crisis.
Andrew Broad, the Member for Mallee, wants banks to forgo a deposit from first-home buyers who have a three-year rental history.
He argued if the mortgage repayments were roughly the same as the buyer's rent, the bank should not need security.
"I think it has serious potential," he said.
"Essentially what a bank needs to do is see that a person has the capacity to service a loan.
"What a government needs to do is make sure a person who wants to purchase their first home can get into the property market."
Banks and financial institutions usually require a 20 per cent deposit, which Mr Broad said was locking people out of the property market.
He said he had heard from people in his electorate who simply could not afford to save that much money.
The Prime Minister tasked the Minister Assisting the Treasurer, Michael Sukkar, to focus on housing affordability.
He has not ruled out a crackdown on capital gains tax concessions for property investors, but Labor's policy of tackling negative gearing is off the table.
Mr Broad said he had floated his proposal as another way to make housing more affordable.
"There's a lot of receptiveness to this," he said.
"This is the space that creative governments can play in, rather than the very populist but unrealistic rhetoric of getting rid of negative gearing."
Topics: housing, business-economics-and-finance, housing-industry, australia
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