As Australia’s population ages, the housing needs of older Australians are becoming increasingly important. According to Temple & Webster’s research, a significant proportion of older Australians (aged 55-74) are considering downsizing, with 55% of those intending to move citing the desire to find a more manageable and suitable home for their retirement years.
Rightsizing
For older Australians, the concept of rightsizing is not just about moving to a smaller property; it’s about finding a home that meets their specific needs for this stage of life. This includes considerations such as the practicality of the home, proximity to essential services, accessibility, and the availability of community amenities.
Preferences and Concerns
Older Australians have specific preferences when it comes to their housing, and these preferences often differ significantly from those of younger generations:
-
Practicality over luxury: Older Australians tend to prioritise practical features in their new homes, such as private garages, ample storage space, and proximity to essential services like hospitals and shopping centres. While luxury features like large backyards and high-end finishes may be desirable for some, the majority of older Australians are more focused on the practicality and financial benefits of moving to a smaller, more manageable property.
-
The Temple & Webster study found that having a lock-up garage was the most important consideration for Australians aged 55-74.
-
Proximity to services: For older Australians, being close to shopping centres, medical facilities, and public transport is a top priority. 51% of 55-74-year-olds said that having a shopping centre nearby was a must-have for them. Proximity to public transport, hospitals, and parks is also highly valued by this demographic.
-
Convenience and accessibility: This demographic is less concerned with staying in the same neighbourhood or maintaining a large outdoor space, and more focused on convenience and accessibility.
-
Concerns about space and privacy: Despite the appeal of downsizing, many older Australians express concerns about having enough space in their new homes. This includes worries about the ability to accommodate guests, storage needs, and lifestyle changes that may come with a smaller living space. Privacy is also a significant concern, particularly for those considering apartment living, where close proximity to neighbours can be an issue. The Temple & Webster study found that having adequate storage, parking, a garden and a spare bedroom were the top requirements for their new homes.
Barriers to Entry
Despite the clear benefits of rightsizing, there are several barriers that prevent older Australians from making the move:
-
Low uptake of retirement communities: Despite the strong interest in downsizing. The Temple & Webster study found that only about 5% of Australians in this age group currently live in over-55 or seniors’ retirement communities, and only 4% are considering moving into such communities in the next two years. This indicates a significant gap between the desire to downsize and the appeal of existing retirement living options. Factors such as cost, perceived loss of independence, and concerns about lifestyle adjustments may contribute to this low uptake as well as the difficulty in securing a home in a retirement living community.
-
Emotional attachments: Many older Australians have lived in their current homes for decades and have deep emotional attachments to their properties. The prospect of moving can be daunting, particularly when it involves leaving behind a home filled with memories and a neighbourhood they know well.
-
Financial considerations: Financial motivations play a significant role in the decision to downsize. While many older Australians are looking to move into cheaper properties, they also want to free up equity or reduce ongoing living costs. However, the cost of buying a new property, along with associated expenses such as stamp duty, moving costs, and the potential need for renovations, can be a deterrent.
- A limited supply of suitable and available housing alternatives to move into creates challenges for older Australians. Unless there is a longer term approach to create more options for them, they will have no option other than to stay in their existing (and sometimes unsuitable) dwellings.
The Challenge for Older Australians
Never has rightsizing been more topical as we face the impact of a major demographic shift in the makeup of the Australian population. With 17% of the population in the 65+ age group, we will see this move to 25% by 2050. One in four Australians will be aged 65 and older. This places significant focus on the availability of suitable homes for older Australians that are the right size in all aspects for them.
One of the most pressing issues is finding ways to encourage older Australians to transition from their large, family-sized homes into properties that better align with their current life stage. Many older Australians remain in homes that are now too large for their needs, often due to emotional attachments and the lack of appealing alternatives. However, this situation contributes to the broader housing crisis by reducing the availability of family- sized homes for younger families.
To address this, it is essential to create housing options that cater specifically to the needs and preferences of older Australians. These options should include smaller, more manageable homes that offer practical features such as accessibility, proximity to essential services, and community amenities. Housing developments designed with older Australians in mind should emphasise ease of living, security, and the ability to maintain an active and socially connected lifestyle.
Prioritise rightsizing in housing strategies
Given the growing trend towards rightsizing, policymakers, developers, and real estate professionals should focus on creating housing options that align with Australians’ evolving life stages and lifestyle needs. Rightsizing is not just about moving to a smaller home; it’s about finding the right balance of space, affordability, and functionality.
Future developments should include a mix of housing types that cater to these diverse preferences, from well- designed apartments to manageable townhouses.
Address housing affordability and accessibility
The affordability crisis, particularly for younger Australians, is a significant barrier to homeownership with only 10% of Australians aged 25-34 believing they are extremely likely to ever own a home.
To address this, there should be a concerted effort to develop more affordable housing options for first-time buyers. Additionally, expanding the availability of long-term rental solutions, such as Build-to-Rent (BTR) developments, will provide greater stability and affordability for those who may not be able to buy.
Innovate in housing design for modern needs
With Australians increasingly looking for homes that offer flexibility and functionality, particularly with the rise of remote working, developers should focus on designing homes that include multi-functional spaces, such as spare rooms that can serve as both a guest bedroom and a home office.
This approach not only maximises the utility of the home but also supports the diverse and changing needs of modern households.
Enhance the appeal of apartment living
Apartment living is becoming more prevalent, especially in urban areas, but barriers remain, such as concerns about space, privacy, and lack of outdoor areas. This report highlights that nearly half of Australians are hesitant to consider apartment living due to these factors.
To make apartments more appealing, future developments should include features like soundproofing, private outdoor spaces, communal gardens, and multi-functional layouts. Emphasising these benefits can help shift perceptions and increase the acceptance of apartment living as a viable option for families and older Australians.
Support the housing needs of older Australians
A significant proportion of older Australians are considering downsizing, yet many are deterred by the lack of suitable housing options. It’s essential to develop homes that cater to the specific needs of this demographic, focusing on practicality, accessibility, and proximity to essential services. Retirement living options should address concerns around space, privacy, and affordability while fostering a sense of community. By providing new housing options for this group, we can free up larger homes in sought-after locations for family groups.
Foster multi-generational and co-housing models
This report identifies emerging trends such as multi-generational living and co-housing as potential solutions to the housing affordability crisis. These models not only make housing more accessible but also provide economic and social benefits by allowing families to pool resources. Developers and policymakers should explore and promote these alternative housing configurations as part of the broader strategy to meet the diverse needs of Australian households.
Continue research and adapt to trends
Staying informed about changing housing preferences has never been so important. Ongoing research and data collection are crucial for understanding these shifts and should inform future housing policies and development plans. By remaining responsive to trends, stakeholders can ensure that housing solutions remain relevant and effective in addressing the needs of Australians.
Collaborate across sectors for effective implementation
Successfully implementing these recommendations will require collaboration between government, developers, community organisations, and the private sector.
A coordinated approach is essential to create sustainable housing solutions that meet the diverse needs of Australians, from young renters to older downsizers. By working together, stakeholders can address the housing challenges identified in the white paper and contribute to a more resilient and inclusive housing market.
