The Australian Housing and Urban Research Institute recently completed a survey of 1604 older home owners and found that they’re about as keen on moving house as getting divorced, their partner dying, or finding themselves imprisoned.
The important findings make it clear that if government is hoping for any relief from older Australians to its housing supply problems, it can look elsewhere. Ninety per cent of them believe their home is just the right size for them, even after their children have moved out. So, government will just have to put its planning and policy thinking cap back on because its current assumptions are wrong.
Australian homes are considered big by international standards. Take the Canadian view, for instance. Applying that government’s calculation of housing occupants to housing size and composition shows that 88 per cent of Aussie homes are grossly under-occupied and hence under-utilised.
Older Australians live as singles or couples in houses with three or more bedrooms and they own their homes outright. If just 20 per cent of Baby Boomers were to downsize into smaller accommodation, the vexing housing supply problem would be solved.
Over 55 year olds make up 25 per cent of Australia’s population – that’s 5.6 million people. Over 65 year olds make up a further 13 per cent – 2.9 million people. The over 65 component will grow to 19 per cent by 2021 and when you add the figures together it’s not hard to see that the problem, with immigration thrown into the mix, is getting worse.
To avoid moving into retirement villages or into their children’s homes, which they find ‘distinctly unappealing’, older Australians plan to alter their homes, installing grab rails and ramps so they can stay put. Less than 20 per cent are willing to consider downsizing.
The Australian Bureau of Statistics says there will be between 9.4 and 10 million households by 2021, but that’s reliant on houses being built faster than the population is currently growing. At current rates, it’s possible that close to 20 per cent of Australia’s larger housing stock will be inaccessible to first home buyers, young families or investors.
Adding to the complexity, 1.7 million people own two, three or more properties and Baby Boomers are overrepresented. They, however, have no intentions of downsizing, considering those extra bedrooms ideal for other recreational pursuits and the accommodation of visiting relatives and friends. Plus, instead of passing on that wealth to their children, Baby Boomers intend upon selling their investments and spending the money, so the homeownership will not necessarily be passed to offspring.
Homeownership among young people is falling and this is not a new trend. Australia is certainly one of the most expensive places in the world to buy a house and the chronic shortage of homes means rents will simply continue to increase.
Planners are increasing housing densities and encouraging smaller apartment-style dwellings to cater for a perceived demand that it appears does not exist amongst older homeowners. Perhaps it shouldn’t surprise government when it has been long known that Australians love their traditional quarter acre block, the back yard barbecue and, increasingly, a vegetable patch.
It is Australian families as well as immigrants of the future who will probably occupy inner city and middle suburban ring apartments, which, most likely, will be owned by others.
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