Half of over-55s are open to downsizing – if only they could find homes that suit them

Font Size:

Amity James, Curtin University; Steven Rowley, Curtin University, and Wendy Stone, 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 2400 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.

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 2400 households over 55 were surveyed, found 26 per cent 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

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 per cent), studies (50 per cent), or dedicated rooms for children or grandchildren (31 per cent).

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.

Author provided

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 per cent 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 The Conversation

Amity James, Senior Lecturer, School of Economics, Finance and Property, Curtin University; Steven Rowley, Head of School, Economics, Finance and Property, Curtin University. Director, Australian Housing and Urban Research Institute, Curtin Research Centre, Curtin University, and Wendy Stone, Associate Professor, Centre for Urban Transitions and Director, Australian Housing and Urban Research Institute Swinburne Research Centre, Swinburne University of Technology

This article is republished from The Conversation under a Creative Commons license. Read the original article.

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Join YourLifeChoices today
and get this free eBook!

By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy


Could downsizing save your retirement?

The good, the bad and the ugly of downsizing to save your retirement.

Steps to make downsizing easy (ish)

Downsizing can be a daunting and emotional process, but here's how to make it manageable.

Making downsizing affordable

A pilot program will be introduced to assist older Australians to downsize their home.

Written by The Conversation


Total Comments: 18
  1. 0

    Downsize to an affordable home in a regional city with strong infrastructure and live off the proceeds of your city dwelling sale. Simple !! Do your research on Internet.

    • 0

      Arvo – NOT as simple as it sounds. I did that for a few years whilst still working, prior to going on the Aged Pension. I was offered a job in a rural town with an airport, hospital, 1 set of traffic lights, one a week train, dearer petrol, no cinema, very limited choice of activities, No Aldi (that was the MAJOR drawback!). Also – only one power supplier who gouges through the roof, medical treatment needed in capital city, rates were actually a little HIGHER than my city home. Want to buy a new fridge? – no choice, just ONE local shop, same fridge in city at least $250 cheaper.

      My neighbor girlfriend needed work on her bi-fold timber doors. No problem in the city. She had to have them dismantled, and shipped to major town 550kms away. Ended up costing her nearly $2000. Probably could have had it done in the city for around $500. She too is in the process of selling and moving to city. I am SO glad I chose to ‘try it first’, and did not sell my house. Around the same time as being eligible to claim Aged Pension, my contract was being ‘reassessed’ so I came back to city. And I absolutely live cheaper here.

      My girlfriend is flying to city in 6 weeks time for a big operation that could not be done at her local hospital. Already she has had to make 3 prior trips to city to see Dr. She is bringing her dog, as are no minding facilities there (apart from vet, no suitable for 3 week stay). Dr won’t let her drive afterwards, so is staying at my place, till she can fly home. Each one way flight can cost around $450 – plus dog charge. Whilst recuperating we are going to check out some real estate.

      I was brought up in the country, love the country, and would love to live out of city. But as I get older, is just not feasible or practical. SO glad I kept my house here.

    • 0

      Regional city is a point – have a Woolies and Coles, possibly Aldi. Definitely a hardware store and Harvey Norman. Just make sure you have a Private Hospital in the neighborhood, waiting lists can be long! Done all the sums and I am happy being regional, but I got all the facilities mentioned above. Costs are cheaper buying but maintenance roughly the same. Should you move from a capital city you cannot ever go back – take it from one who visits the old places frequently. So if concerned about property values and wanting to leave legacies, think long and hard about moving.

    • 0

      Yes sunny. Gosford has such a shortage of specialists that travel to the North Shore is vital. Seems the AMA does not want to supply specialists to the regions for financial reasons. This unionism is okay though. Any other union pulling this scam of denying labour to force up prices would be attacked by government and press.

      It’s true that if you move from a desirable area to a cheaper one you can never go back.

      Sunny it’s very clever to try out an area before you make the move. You saved yourself a lot of money and angst by being very wise.

    • 0

      – I stated :”STRONG INFRASTRUCTURE” regional city. Your choice was a rural town…What did you expect?

  2. 0

    From what I hear, a huge problem is the imposition of Compound interest in any borrowings.
    Even if you have lots of equity, compound interest will quickly gnaw away your money.
    Reasonable bank interest is fine, like what you get from your bank, – compound interest is putting you into the clutches of the criminal caste, and sensible people will not have a bar of it.

  3. 0

    It’s not just the downsizing that’s the killer, with all the dozens of fees and expenses you can expect to pay over $20,000 on top of the cost of a low to medium prced house.

    • 0

      I actually think it’s more when you factor in Agents Commissin to sell, advertising fees, Stamp Duty, removalist plus there is always some money that needs to be spent on the new place.

  4. 0

    I live in a regional city so have all the amenities we need. However normal size houses are much cheaper to buy than townhouses or units. Probably a case of supply and demand.

    • 0

      Yes this is another great way to Downsize for sure …. I still like the adventure but If I will in he near future move to regional city for sure …. well done mate

  5. 0

    I Downsize after finish working at 70 ….. by living Oveseas for 6 to 8 months and sometimes more and just come back to stay with my kids for a short time ….. and has been the best way to downsize for me ….. Only pay 80-90% less in rent, electricity, Gas and water of what I will pay in AU and eat with about $150 x forthnite and a full fridge with all I want ….. Great and all fresh .

    No mortage no Credit cards to pay no loans to cover absolutely $0.00 Debts …. so my reduce pension is more that sufficient and manage to keep about 200 dollars every forthnight for any emergencies …… That is my Downsize program and is working great ….

    Think about it and you will save the Gov. Budget over 4 to 5,000 dollars x year by not using any of the goodies we get in AU like Medicare and a lot more …….

    • 0

      Not everyone likes to live overseas 6 to 8 months, Aussie. But Good Luck to you if you like it. The places overseas I would like to live a bit longer are far too expensive – the alternative is Asia and I have been there for many times; holiday there fine but living there no way, but that is me!

    • 0

      Is all good Mariner and yes I had to make some adjustments and acceptance to my life to be able to absorb the asian cultures ….. but at the end works well for me …. I understand that Asia is not for everyone …. no worries mate and yes other countries may be more expensive …. all good mate take care

  6. 0

    Why would anyone want to downsize if the money left would be counted by the pension people? I look at the asset I would have in a house and when I am totally exhausted financially I might consider downsizing since I am allowed to have a certain amount of cash which I would spend again. Most of old people want to get a maximum inheritance built up for their offspring (Australian way). Not my way, I like spending money now and enjoying it now, there might not be another opportunity on the other side.

    • 0

      .Knowing a few people who have opted for the Thai lifestyle, – wonderful and fine, and be part of the village, but if you develop medical problems later on you may need a bolthole in Oz, near medical facilities.
      Just a thought.
      On the other hand you may just waste away gracefully and do better by having loving care till the end, – the which you would be extremely lucky to get in Australia.

    • 0

      I’m with you Mariner – why would you want to downsize if it made you worse off under the CL rules.
      I can’t downsize much more. I can’t see the point in downsizing if most of the small amount I would clear, goes on costs to estate agents, moving, stamp duty, etc.
      And like you, I am vehemently against seniors wanting to live in poverty and penury just to leave an inheritance for their offspring. Totally against this. I wish I knew which day I would cark it so I could spend every dollar and leave nothing but debts.

  7. 0

    Lived on a few acres and had no intention to downsize. However the local council decided to rezone the area to high density. Rates rocketed and I could no longer afford it. Had no choice but to sell up and move further out.



continue reading

Health Insurance

Your health insurance is about to go up. Again.

Do you feel like the cost of your health insurance is always going up? You’re not wrong. Premiums are about...


Private health rebate levels are dropping, what does that mean?

We are all used to private health insurance rebates on 1 April every year, but this year the rebates will...

Health news

Doctors call for convicted child killer Kathleen Folbigg's release

A group of 90 expert scientists and doctors is calling for convicted child killer Kathleen Folbigg to be pardoned in...


Adorable celebrity pets

Just like the rest of us, Hollywood's A-listers are pretty obsessed with their pets, especially when it comes to sharing...

Health news

Who needs a colonoscopy most? Ensuring those at risk head the queue

Professor Jon Emery Mary was 55 when she started having on and off tummy pains, and noticed she needed to...

Health & Ageing

What stress does to your skin, hair and nails

Stress can be an all-consuming beast. Not only does it overwhelm your brain, but it can have a physical impact,...


Multi-generational family living grows, forcing design changes

The trend towards multi-generational living, accelerated by the COVID-19 pandemic, is producing fresh approaches to Australian housing. Urban designer Craig...

Seniors Finance

Your retirement 'pay cheque'

Nothing beats the reassurance of knowing there's money coming in each month. Then retirement happens and, suddenly, it's up to...