ANALYSIS
THE EMPHASIS is for Older Australians to downsize to create housing opportunities … allegedly … for younger households by freeing up ‘Family Homes’ …
BUT who are these ‘younger households’?
HOUSE PRICES in Sydney have risen sharply recently with buyers from both Hong Kong and China again in our housing market, and our aspiring Australian First Home Buyers are left holding their ‘loan approvals’ locked out by the flow of ‘black money’ …
DOWNSIZING opens the market for developers and overseas buyers!
OLDER AUSTRALIANS may be tempted by the ‘hot money price rise’ but in turn it is destroying Our Society as our Families are forced into short term tenancy … having to find alternative accommodation and meet prohibitively expensive moving costs!
BLACK MONEY IS TRANSIENT … IT IS VERY BAD FOR OUR ECONOMY!
PLEASE SHARE AND TELL OTHERS!
Half of over-55s are open to downsizing — if they can find homes that suit them
The Conversation By Amity James, Steven Rowley and Wendy Stone
WEDNESDAY 12 FEBRUARY 2020
PHOTO: Downsizing, or rightsizing, is considered an essential component of meeting the housing aspirations of older Australians. (AAP: Lukas Coch)
Half of over-55s are open to downsizing – if only they could find homes that suit them
February 12, 2020
Authors
- Amity JamesSenior Lecturer, School of Economics, Finance and Property, Curtin University
- Steven RowleyHead of School, Economics, Finance and Property, Curtin University. Director, Australian Housing and Urban Research Institute, Curtin Research Centre, Curtin University
- Wendy StoneAssociate Professor, Centre for Urban Transitions and Director, Australian Housing and Urban Research Institute Swinburne Research Centre, Swinburne University of Technology
More than half of Australians over the age of 55 are open to downsizing, according to a new report based on a survey of 2,400 households.
The main barrier to moving to a smaller home is a lack of housing that matches their needs and preferences. The rapid growth in the number of older Australians adds to the major challenge housing markets face in meeting their diverse housing needs.
Downsizing, or rightsizing, is considered an essential component of meeting the housing aspirations of older Australians. At the same time, downsizing creates housing opportunities for younger households by freeing up family homes.
CAAN: The issue with this is that in Older Australians selling … ‘the buyers’ … in the majority appear to be either developers or overseas buyers with ‘hot money’. Aspiring Australian First Home Buyers may have the loan approval however, they are outbid by ‘hot money’!
Read more: What sort of housing do older Australians want and where do they want to live?
The ageing population also creates fiscal challenges for government, in terms of delivering services to the home and providing residential care. Downsizing can enable older Australians to age well and age in place rather than potentially move prematurely into residential care.
The report released today by the Australian Housing and Urban Research Institute (AHURI), for which 2,400 households over 55 were surveyed, found 26% of such households had downsized. Another third had thought about it. Overall, the findings point to a strong appetite among older Australians to downsize their dwellings.
With about 6.5 million Australians aged 55 or older, living in about 4.3 million households, our findings suggest downsizing could be relevant to 2.5 million households.
Why downsize? And what are the obstacles?
We know older Australians downsize in response to life events such as changes in health and relationship status, or children leaving the parental home. Lifestyle preferences and difficulties maintaining their garden or house also shape downsizing behaviour.
Barriers to downsizing include a lack of suitable housing and a lack of financial incentives. There are also emotional and physical barriers to moving. Financial factors, however, do not greatly impact the decision to move, nor does perceived financial well-being increase once they have downsized.
Read more: Downsizing cost trap awaits retirees – five reasons to be wary
CAAN: Strata titles can apply to multi-dwelling developments and duplex! Not just apartment developments! Very expensive!
Reason 1 – upfront moving costs are high
Reason 2 – levies are high
Reason 3 – costs of maintenance
Reason 4 – loss of financial security
Reason 5 – loss of security of tenure
Loss of security of tenure is usually associated with renters. However, the recent introduction of termination legislation in New South Wales gives other owners the right to vote to terminate a strata title scheme. When this occurs, all owners, including reluctant owners of apartments within that scheme, are compelled to sell.
Where those who had downsized were dissatisfied, this was most commonly related to the new dwelling, particularly its size, and the neighbourhood.
Is it actually downsizing?
One of the policy rationales for downsizing is to reduce the underutilisation of dwellings. However, this is at odds with the attitude of many older Australians.
They consider “spare” bedrooms necessary for use as permanent guest rooms (58%), studies (50%), or dedicated rooms for children or grandchildren (31%).
Space remains important to Australian downsizers. Over half of them move to a dwelling with three or more bedrooms. A third move to an apartment.
However, two-thirds of downsizers surveyed did move to a dwelling with fewer bedrooms. Three bedrooms was the preferred dwelling size for older Australians. Downsizing the garden was essential for most.
Older Australians aspire to attain or retain home ownership. Their preferred neighbourhood has shopping, medical, recreational and public transport services all within walking distance.
Downsizers appear mobile. While under a quarter downsized within their original neighbourhood, 42% moved to a neighbourhood completely new to them.
The survey finding of a lack of suitable housing options matching would-be downsizers’ preferences may explain why so few were able to downsize in their original neighbourhood.
Delivering what older Australians want
If the local market does not have enough options available to meet the needs of older households, it is very difficult to downsize within an existing community. Moving to another desired location can also be problematic.
Meeting the needs of older Australians generally means an increase in medium-density housing. Developers are likely to require incentives to produce these medium-density products rather than potentially more profitable high-density development – although there is, of course, a downsizing market for well-located apartments.
Read more: People want and need more housing choice. It’s about time governments stood up to deliver it
The retirement industry has begun responding to the aspirations of older Australians. It is developing larger dwellings and offering a growing range of options, from high-end to affordable — all of which are accessible and suitable for ageing in place.
Equity-rich older Australians may wish to build a new dwelling in which to downsize. But they are often unable to borrow for this unless they have considerable capital available.
To support this avenue, new development finance models could be created to allow older Australians to develop without first having to sell the primary home. This shift would allow more collaborative forms of development, such as a group of like-minded individuals developing a site as housing for a small community.
Read more: Co-housing works well for older people, once they get past the image problem
For those vulnerable private renters moving into retirement, more secure rental accommodation through the social housing sector and delivered privately is essential. The community housing sector has a key role to play.
Where next?
The Australian housing landscape must shift towards a model of dwelling diversity with secure tenures – ownership and rental – in neighbourhoods where residents can walk easily to weekly services and recreation facilities, participate socially and be close to public transport options.
Read more: Fall in ageing Australians’ home-ownership rates looms as seismic shock for housing policy
Design is equally important. Australians need adaptable dwellings that can change to meet housing needs.
Such a landscape will provide effective downsizing options in which households can age well in the places that best meet their needs and aspirations.
Read more: For Australians to have the choice of growing old at home, here is what needs to change
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