Using superannuation for a home deposit

Average customer rating: 4.3/5
Written by James Hurwood
Reviewed by Stephen Zeller
Updated April 11 2024

Tips for first home buyers

Host of Selling Houses Australia, Andrew Winter, walks first home buyers through some of the things they’ll need to keep in mind as they gear up to take out a home loan.
Andrew Winter
Home Loans
First-home-buyers

Expert tips for using your super for a home deposit

Our General Manager of Money, Stephen Zeller, wants to make sure that prospective homebuyers are making an informed decision when considering accessing their superannuation to build a home deposit. With that in mind, he has some tips:

Stephen Zeller
General Manager – Money

Start crunching the numbers

If you’re looking to start building up the amount you’d have available for withdrawal you’re your super, set a budget and a realistic goal so you know how much you’ll have available to contribute via the scheme at your chosen point in time.

Understand the tax benefits

If you’re consistently making concessional (i.e., pre-tax) voluntary super contributions, saving up part of your deposit within your super fund could save you a decent chunk of change in income tax.

Buying with a partner?

You and your partner could potentially both decide to utilise the scheme, and combine your saved funds into one deposit or part-deposit to increase your borrowing power.

First Home Super Saver Scheme explained

The FHSS scheme is a government program that is administered at the Federal level by the Australian Taxation Office (ATO). It was introduced in 2017 and gives Australians another way of building up a home deposit by essentially using their super accounts as deposit savings accounts.

It allows eligible first homebuyers to access the voluntary contributions they’ve made into their super account up to a maximum amount of:

  • $15,000 in eligible contributions from any single financial year
  • $50,000 in eligible contributions across all years.

The FHSSS does not allow for the release of any portion of your superannuation balance which is not made up of voluntary contributions. This means that any mandatory superannuation guarantee payments made into your superannuation account by your employer will not be available for release.

The pros and cons of using your super to buy a house

While gaining access to your voluntary super contributions can be an invaluable tool for prospective first homebuyers, there are numerous risks that can come with dramatically reducing the balance of your superannuation account. That being said, everyone’s financial circumstances and priorities are different, so we’ve laid out the major pros and cons of a superannuation home deposit to try and help you make a more informed decision on whether this is right for you.

Pros Cons
  • If you’re a first homebuyer, it can help you buy a home sooner
  • The wealth you’re taking out of your super is being secured inside another asset
  • Your property’s value growth could outpace the returns you see in your super account
  • Drawing on your super early on in your life could affect your quality of life in retirement
  • You likely won’t be able to form a full deposit out of your super contributions, meaning you’ll generally still need a sizeable saved deposit on hand
  • Superannuation will generally be a slightly less risky place to store wealth than the property market

Applying for the First Home Super Saver Scheme

First Home Super Saver Scheme eligibility

The FHSSS’ financial hardship provision

How do I access my super savings via the FHSSS?

Important information about using the FHSSS

Will I get taxed on the money I withdraw from my super?

Can I use super to make up 100% of my house deposit?

What are voluntary super contributions?

Meet our home loans expert, Stephen Zeller

Stephen Zeller
General Manager – Money

Stephen has more than 30 years of experience in the financial services industry and holds a Certificate IV in Finance and Mortgage Broking. He’s also a member of both the Australian and New Zealand Institute of Insurance and Finance (ANZIIF) and the Mortgage and Finance Association of Australia (MFAA).

Stephen leads our team of Home Loan Specialists, and reviews and contributes to Compare the Market’s banking-relating content to ensure it’s as helpful and empowering as possible for our readers.

1 Australian Taxation Office. First home super saver scheme. January 2024.

2 Australian Taxation Office. Tax on super benefits. January 2024.