Experts on the Canberra property market have welcomed federal budget measures to help aspiring first-home buyers save for a deposit and encourage older Canberrans to downsize.

However, the effectiveness of the incentives announced in Tuesday’s budget rely on the provision of better housing types for the ACT’s elderly population, as well as the release of more land for residential property.

Nicola Powell, data scientist for Allhomes, said that the $250m First Home Super Saver Scheme provided an additional incentive to save; however, supply would need to be amplified to meet demand.

“What it will do is boost the demand for entry-level properties and that’s really adding fuel to the fire if you don’t do anything about the supply,” Powell told the Domain Group. “In the Canberra market unlocking the supply really is the crux of the solution.”

Greg Weller, the Housing Industry Association’s regional executive director for ACT/Southern NSW, said that while the new scheme might not cover a full deposit on a property in Canberra, it would make a significant contribution.

The scheme will allow first-home buyers to save towards a deposit at a discounted tax rate by making added contributions to their super, capped at $30,000.

“The fact it won’t get an entire deposit isn’t a reason not to do it. Superannuation is about saving for people’s retirements and there’s no better way to ensure people are comfortable and not draining the public purse in retirement than owning [their] own home,” said Weller. “I think what the government has come up with here, given the concerns, is a really good way to compromise and use the means of super while protecting compulsory contributions.”

As for downsizing Canberrans, the ACT government would have to chip in with better housing options to complement the federal government’s announcement of a $300,000 super contribution for retirees who sell their family home, according to experts.

“It’s a huge amount of money. For a couple it could be the complete sale of a home, but the decision to downsize is not necessarily about the money,” Powell said, noting that retirees were not only attached to their homes, but to the suburbs in which they live.

If appropriate housing isn’t available in their neighbourhoods, some will choose to stay put in their family homes. As a result, territory planning to address this “missing middle” was vital to keeping retirees within their communities in their quest to downsize, according to Kirk Coningham, executive director of Master Builders Association ACT.

He said downsizing incentives might include getting adult children to buy the family home, and if the block size is appropriate, accommodate elderly parents in granny flats.