PHOTO: The money saved for retirement is better off being spent on buying property now, CIS argues. ABC News: Phil Scarano

The wages that Australian millennials are forced to put aside for retirement are better off being spent now buying a home, according to the Centre for Independent Studies (CIS).

Key points:

  • Home ownership rates have tumbled for those aged 25-34 and 35-44
  • Property prices have risen sharply relative to incomes, as have home deposits
  • Money paid into super funds may be better spent on buying property now, CIS argues

The “massive increase” in house prices — particularly in Sydney and Melbourne — “delays property ownership for first home buyers”, making it much harder for young workers to save for a deposit, said CIS research director Simon Cowan.

“Super is paid for out of the wages of workers, diverting more of those wages to prop up future super balances will damage workers in the present.

“Though it is likely that home ownership is more important than accumulating superannuation, the system prioritises superannuation above home ownership.”