The peak body representing Australia’s finance brokers says the reduction in the threshold to the paid parental leave scheme and some other budget cost cutting measures may cause the housing market to slow and increase pressure on families with mortgages.
CEO of the Finance Brokers Association of Australia Peter White says younger families in particular will think twice before committing to mortgages, creating a flow-on effect through the economy.
He said while the debate over the scheme has focused primarily on the cost to the country, the benefits also need to be considered.
“While recognising that the Government must look at measures to balance the budget, we are simply pointing out that a scheme like this also has the potential to stimulate the economy through allowing more families to own their own home,” he explained.
“One of the biggest fears that families have is not being able to sustain mortgage payments while one partner is away from work caring for a new baby.”
Mr White, a 35 year veteran of the finance broking industry and one of the nation’s leading voices in the sector, said consumer confidence in the housing market was vital for economic growth.
“In this budget, the Government cannot afford to do anything that jeopardises confidence in the housing market, because so many industries and people are affected when this market slows.”