Is renting a good option for your retirement?

Is owning your home the best option for your retirement or is there another option?

Is renting a good option for your retirement?

Home ownership across Australia is on the decline.

According to 2016 census data from the Australian Bureau of Statistics (ABS), 65.5 per cent of Australian homes are owner-occupied, compared with 67 per cent in 2011.

Renting in retirement is still relatively rare with around 15 per cent of older Australians living as tenants according to a Productivity Commission report on the housing decisions of older Australians in 2015.

The Productivity Commission report also said that most of the people in this cohort were “generally a highly vulnerable and economically disadvantaged group”. Thus, very few people made an active choice to rent in retirement.

There are reasons that so few people choose this option as the Australian Age Pension system excludes the primary residence from the asset test required to access their pension payments. This exclusion of the primary residence from the asset test discourages people from freeing up the equity in their home, as it can prove costly once that extra money is assessed as deemed income or an asset.

However, if you are a self-funded retiree and already ineligible for the Age Pension, or in a situation where you can sell your home without affecting your pension, renting might be more popular than it first seems. Here are some reasons why.

Access the equity locked in your home
This is the first and most obvious reason to sell your home and take up renting. Taking this option can create a much more comfortable retirement and allow you to spread the money into different investments, which can help make sure that you don’t run out of money. The main reason so few retirees want to free up the equity in their home is that they are worried they will have less wealth to pass onto their heirs. However, adult children often support their parents’ decision to tap into home equity to make their retirement more comfortable.

Try before you buy
For retirees looking for a sea change in their later years, or perhaps even a tree change, renting can be the ideal way to try out a new location without going to the hassle and expense of buying. You can also try moving closer to public transport, test out the feel of a smaller property or try out different neighbourhoods or suburbs.

Living closer to children or grandchildren
You may not be able to afford to buy a property close to where your adult children are living, especially if they are living in inner Sydney or inner Melbourne, but renting may be an option.

No home repairs or maintenance
One great thing about being a renter is that when something breaks, you don’t have to fix it yourself – or pay someone else to fix it. In many rental agreements, the landlord is responsible for property maintenance.

The flipside
There are, of course, many negatives to renting in retirement. It will significantly increase your housing costs and consume a large portion of your income. There is also the risk that your landlord could terminate your lease. This uncertainty and the practicalities of moving home later on in life could cause you unnecessary stress.

Would you ever consider selling your home and renting in retirement? What factors would make it an attractive option?

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    COMMENTS

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    Charlie
    25th Apr 2019
    10:02am
    For many its not an option, its a necessity.
    Aussie
    25th Apr 2019
    2:38pm
    Yes Charlie is a necesity but after a while and learning about all the Gov. movements to include the home as part of your Assets and many more to come in the near future ..... that necesity became a real pleasure to live without any worries ... in my case I spend as much time I can renting overseas for about $150/$170 x month on a Aprtment on the water and some times with luck small home very close to the sea just walking distance .... So the necesity became a pleasure

    Some people in this forum keeps telling me that I should rent in AU and I should live in AU and spend my pension money in the country ... Yeahhhh sure .... but is imposible to maintain a decent life style with full benefits (Health, Good food, Great new friends and lots more) with just the pension ....
    Sachka
    25th Apr 2019
    3:59pm
    Oooh, that sounds good to me! Would love to know how to do this...is it complicated working that out with pension etc; I want to come join you ....
    Aussie
    25th Apr 2019
    8:47pm
    No problem Sachka .... I am able to travel 2 times x year and stay outside for a long time no worries exept that after 6 weeks outside AU you will not get any benefits at all no medicare or any other goodies that you will get if stay in AU you only get the basic pension $843.60 and $23.80 suplement nothing else so you have make some adjustments in your day to day and get use to the Asian food in Bali, Thailand, Vietnam or any other place you go.

    So you will get only $1,694.80 x month but you can live very well with that money because the cost of living is so cheap and the money goes a long way including savings to be able to return after certain time if you want because an average return ticket will cost you about $600 (Economy ofcourse) so if you are not use to travel economy you may need to adjust.

    So yes is great what I do but I had to make a lot of adjustments in my life but the end result is great .... very easy life without any worries at all just enjoy the sunshine and greatfresh food
    Charlie
    25th Apr 2019
    10:01pm
    I think you have to get these things set up long before retirement age... For me there was an unexpected medical condition at 56 that left me floundering without my previous mental skills or endurance.
    Nanna75
    25th Apr 2019
    10:16am
    I decided to sell my home shortly after my husband died 4 years ago. I was responsible for a mortgage but my only income after he died was my aged pension. I sold it 2 years ago and now have some money on deposit. My son who had a divorce a few years earlier and was now renting suggested that we join forces and rent a home nearer my other son so we could be closer and I could see my grandchildren more often.
    We have split the rent down the middle and also split the electric and phone/Internet. We don't pay for water. I can now afford to rent a nice home and invest my gains from selling my home. Renting has been a blessing for me, I don't have to pay mortgage, maintenance, etc.
    My only worry is do I have enough funds behind me to see the rest of my life out, but I know I'm now in a much better position than many retirees.
    sunnyOz
    25th Apr 2019
    1:19pm
    Nice..until home owner decides to sell. I have friends who chose to do similar to you. In 7 years they have been forced to move twice. And what happens when son/daughter starts a new relationship? Have new partner move in, or they move out?
    Sachka
    25th Apr 2019
    3:56pm
    I think you have been very wise...also that you have family support and are blessed that you have achieved what many of us seek = peace of mind,security & good family connections = well done and may you continue to bless and be a blessing to your family.
    Hoohoo
    26th Apr 2019
    4:05pm
    Well done, Nanna75.
    Can you tell me if you are on an OAP (Old Age Pension) & has selling your house affected your payments?
    Cowboy Jim
    25th Apr 2019
    10:41am
    If I had some certainty of tenure I think I would be better off renting a unit than owning one. Presently we own the place outright but the outgoings are body corp of $2850 and council rates of $2200. The place is worth roughly $320'000. Should we sell it and rent we could easily keep the selling amount since we could have $207'000 more in assets than a home owner. On top of that we would apply for rent assistance of about $130 p.f.
    Of course everything is different for people in family homes of $1 mio plus, that is where the asset exemption for owners really count. For us cellar dwellers it is not an issue.
    Franky
    25th Apr 2019
    12:56pm
    good point, I would never consider downsizing and purchase a unit here in Australia. Costs are prohibitive, taking up roughly half what would be paid out in rent. Much better to sell and invest the money, I think doing the sums you would be better off.
    tisme
    25th Apr 2019
    10:48am
    its a necessary evil , with rents like mine , $700.00 per fortnight out of an income of $1000.00 pf . the number of ratbag landlords and realtors , I have to replace the soil in outdoor planter boxes , im expected to replace rusted out laundry sinks and curtains that aren't fit for the dump.
    Franky
    25th Apr 2019
    12:58pm
    shop around.... I find the laws are rather stacked against landlords today, your example is rare. Depends where you live though, there are some areas with very tight rental supply.
    KSS
    25th Apr 2019
    3:23pm
    I suggest you check the tenancy laws because what you claim is your responsibility is not allowed under tenancy laws. There should be a tenant advocacy organisation in your state that you can contact free if charge to get the facts on your rights. They can even take up your cause against the landlord.
    Hoohoo
    26th Apr 2019
    4:24pm
    Good advice, KSS.
    When entering a tenancy agreement in NSW, you fill out a multi-page "Condition Report". It is very comprehensive & the tenant is required to tick off on everything from window screens & glass to carpets, light fittings, flooring & dirtiness anywhere in the premises. Make sure you note on this report ANY thing that's not 100% up to scratch. The landlord or Agent also is required to fill out this report. When you finish your tenancy, you'll fill it out again & if there's anything wrong with the premises, you will need to have it repaired or the cost of it will be deducted from your Bond.
    So it's VERY IMPORTANT to note problems at the start, otherwise it will be deemed as your expense.
    That said, rusted out laundry tubs are not the responsibility of the tenant - it's called "normal wear-&-tear" that the landlord is required to upkeep. Then again, if you kept plants in the laundry tub (& that caused rusting) then it's not "normal wear-&-tear".
    Cotton curtains exposed to the sun will break down in a few years. (I just found that out - the hard way!). If it's normal usage then you shouldn't have to pay for them, but you'll have to prove "normal usage". If you still want nice curtains, then buy your own (using the current fittings) then when you leave, replace them with cheap ones from the Op Shop & take your nice ones with you.
    tisme
    25th Apr 2019
    10:48am
    its a necessary evil , with rents like mine , $700.00 per fortnight out of an income of $1000.00 pf . the number of ratbag landlords and realtors , I have to replace the soil in outdoor planter boxes , im expected to replace rusted out laundry sinks and curtains that aren't fit for the dump.
    Paddington
    25th Apr 2019
    11:09am
    Crazy! Of course people who have to rent are poorer than those who have the luxury of owning a property. Renting usually means they have zero cash as well. Body corporates rip off people as well. Sharing might help but that would not suit or be available to everybody. We knew we needed to own a home for retirement even though we had little else and it took all our available funds to do so. People need to count all their assets to decide how badly off they are. If you do not even own a home you are at the bottom of the rung.
    We have family members in this situation and it is not one to envy.
    MICK
    25th Apr 2019
    11:09am
    What a total load of BS Ben.
    So what do you think is going to happen when all the money is gone and inflation is picking up? Ask those who are renters now how they are coping. I read about it all the time on this website and it doesn't sound like a lot of fun for those involved.
    This appears to be the next 'live it up' story which is the official line from our government trying to destitute both families and the nation. And still many of us cannot see the forest for the trees.
    Farside
    25th Apr 2019
    2:07pm
    Horses for courses but at least it's a consideration for some; costs of trading off rental expenses against ownership costs is easily calculated.
    MICK
    25th Apr 2019
    2:17pm
    Ownership is not always possible for all.
    The issue I have concern about is the promotion of spending every dollar you have (to stimulate a failing economy?) and then being at the mercy of governments. So how do the mentally challenged consider things are going to turn out if we have a depression and a government with no money to spend? No choice in that.........for those without a home at least.
    Farside
    25th Apr 2019
    2:22pm
    Hard to believe but I have heard there are SFRs that will run out of time before they run out of money. As I said horses for courses.
    Rae
    26th Apr 2019
    7:22am
    I've heard a lot of nonsense about SFRs as well. Yes some have lots of money but most don't.

    Running a country on rumour, beliefs, what we think and feel instead of reality is dodgy.

    Economists should fix the CPI basket to measure the things we all need. That would raise wages and pensions and possibly fix a lot of issues. They measure the wrong items now.
    Brissiegirl
    25th Apr 2019
    11:15am
    Governments should be encouraging all able bodied people to acquire their own home for lifetime security, especially for old age. Purchasing, maintaining and paying taxes on one's own home is a challenge but there is a greater challenge and insecurity from relying on landlords or taxpayer-funded accommodation in old age. This is why incentives for paying off our homes should trump the often mooted idea of penalising home-owners for having been thrifty, working hard and going without in order to achieve home ownership.
    Paddington
    25th Apr 2019
    12:58pm
    If you own your own home you are lucky. If you have even more assets and wealth you are even luckier. People with no home have zero, ones with their own home have something in the range of $200,000 to under a million for a modest home especially in the cities.
    Some are lucky enough to still have their super, plus other assets and cash. They have millions and how ungrateful most of us are and have no pity for those less fortunate.
    Judging others is a regular pastime on this site. Life is just kinder to some than others.
    Linda
    25th Apr 2019
    1:11pm
    I agree. Some, use property as a wealth builder, others, like me use our home as a shelter. We have lived in the same place for 30 some years and it is our home, our safe haven, our comfort and resting place. For that reason, and the fact that we did have to sacrifice to pay for it, 18 percent interest for the first few years. One home should be safe from government interference. We raised our children here, we have used scarce funds to maintain it, and not for resale, for comfort. It is hard to sleep if the roof leaks and it is raining. It is not our personal fault that values have increased, that has to do with government policies. Our current government in one way or another enables the big end of town, while considering driving us out of our home because of problems they created over time. over time. If the value of our place goes down, so will all the other values so in a way the amount is meaningless to us. Having to relocate late in life is very stressful. Worrying about rent rises or being evicted is not where I want to be in old age. We are concerned that our local rates increase based on the value of our home. It could become unaffordable to live in it because of factors beyond our control. I can't support negative gearing because of what that means for our young folks who also want to live in their own home. Basically I believe the government has made some short sighted decisions over time that now are coming to haunt. They say we need the high immigration to keep the economy going. Now we have crowding in metropolitan areas and rents that are too high for a good portion of the population. Now, we have homeless people, now we have old folks struggling to stay safe and warm and fed. Now we have people getting sick because they can't afford health care or can't even get it because the hospital situation is a total mess both public and private. Renting for older people in these days is a bad idea. If renting property could be a reliable cost and if renters can be protected from being evicted for a set number of years then it could work for some, but not me.
    MICK
    25th Apr 2019
    2:21pm
    Discussion needs to turn to the statement "there are no jobs". That's the reality and Morrison and his cronies turning full time jobs into several part time jobs is simply a shell game for the mentally challenged.
    The reality is you need a FULL TIME JOB to pay off a house and live. More than that you need 2 full time jobs.
    Getting a house is being stolen from millennials. Make no mistake boomers will be an increasing target as millennials start taking charge in the political landscape.
    Farside
    25th Apr 2019
    2:26pm
    Mick's crystal ball is serving him well on this one ... the millenials will not only inherit the earth but will inevitably introduce efficient taxes on property that will ensure the transfer of accumulated boomer wealth will benefit the whole economy.
    Anonymous
    25th Apr 2019
    4:56pm
    In other words, we will become a Communist country, where the savings of those who work harder and sacrifice more to provide for theirs and their families' future will be confiscated to hand to people who did not work as hard or who spent more freely. Great plan. And when people react by refusing to work and save, then the well runs dry, as it has in other Communist countries.

    The way to benefit the WHOLE economy is to ensure work and sacrifice and responsible living is well rewarded - not to tax the enterprising and responsible into hardship to reward dependence.

    If Shorten implements his insane tax policies, ripping $400 billion out of the pockets of hard working Australians, we will give our house to our kids in return for lifetime tenancy rights and claim a pension. Simply no point trying to be independent when it results in repeated attacks on our lifestyle.
    Karl Marx
    25th Apr 2019
    5:45pm
    O&W for the last 6 months or so you have been nothing but the Prophet of Doom. The Father of Fear.
    Pity you are so blinded by negativity the it's impossible for you to see any positive outcomes, maybe you should pack your bags & go live in China or somewhere other than here if you're negative about Australia
    Sundays
    25th Apr 2019
    7:08pm
    OAWS why would you give your house away when it isnt included in the Asset test by Centrelink? You dont just gibly apply for the pension you have to qualify. That means spending down or giving other assets away 5 years before you apply. It will never happen given your fixation on money, just more nonsense. Maybe SFR has a solution for you.
    ardnher
    25th Apr 2019
    8:04pm
    owing your home has nothing to do with luck....saving and going without to set yourself up for later in life. ..however saving and going without are not words in the vocabularly of a great many millenials these days so hey will wait to get an inheritance.
    Farside
    25th Apr 2019
    10:58pm
    O&W, there is no chance of Australia becoming a communist country in your lifetime - zilch, nada, zip. Not sure how you could arrive at that conclusion besides wishful albeit convoluted thinking. It is your descendants who will benefit from the millenials nudging out the boomers so don't worry, be happy for them.

    CJ Dennis described wowsers as ineffably pious people who mistake this world for a penitentiary and themselves for warders - ringing any bells? Take a moment - chill, calm your rage and stop a while to sniff the roses. History suggests the economy is unlikely to be as bad as you believe if Labor wins on May 18.
    Hoohoo
    29th Apr 2019
    5:58pm
    I don't know an adult in Australia who would rather rent than buy their own home. If you've ever had to spend years renting, as I did for over 20 years, you'd be absolutely busting to have the opportunity to buy your first home.
    I was fortunate to get the $7,000 first home owner's grant + about $4,000 deducted from Stamp Duty. I couldn't have done it at all if my dear Mum hadn't died suddenly, enabling me to get the 20% deposit required to avoid mortgage insurance.
    I bought the cheapest house in town, but it was mine & I could put a nail in the wall to hang pictures & photos, for the first time. I haven't looked back! I love that I can improve my home, enjoy pet ownership & create my own gardens, without having to ask for permission from a landlord.
    And now I own a huge asset. Rent money IS dead money.
    Hoohoo
    29th Apr 2019
    6:03pm
    I forgot to mention the huge weight off my shoulders - knowing I can't be kicked out.
    I never realised how insecure I felt all those years when I rented. I absolutely HATED Real Estate Agents dragging unsuitable buyers through my rented home, which they did with monotonous regularity. All they had to do was give us notice & then when they found a buyer - notice to vacate the premises by a certain date.
    Hoohoo
    29th Apr 2019
    6:10pm
    And seriously, OlderAndWiser, Communism? Some of you people are so right wing you think Public Transport & Schools are a Commie plot!

    Get this - some of us are very happy to pay our taxes for services provided to people other than ourselves. It means they get unemployment benefits instead of robbing us on the street. It means women don't have to prostitute themselves because they have no money. It means WE HAVE A DECENT SOCIETY, unlike the USA which is based on greed & con-jobs.
    musicveg
    29th Apr 2019
    6:42pm
    Well said HooHoo, crime has definitely risen and so has domestic violence, our society is going down fast due to hardships whilst the rich are prospering. It is terrible what goes on in the USA, I have watched a few documentaries and it is shocking that a rich western country is allowing this to happen,so many people living as a third world country while the third world countries are slowly improving (not all but some).
    Hoohoo
    1st May 2019
    1:13am
    I saw a program on TV last year, showing Americans living in trailers & holding down 3 jobs, leaving 4 hours to sleep. One particular woman had 3 children, who her mother cared for, while she went out to work 3 jobs - just so they could live (rent) in a house.

    I fear the Australian far right wingers (those who call democratic social justice "Communism"), see the USA as the greatest country on Earth (Trump told them so), but they don't realise that crime & pathetically low wages go hand in hand.

    I believe the Liberal Party have deliberately created this reality in Australia now, with stagnant & negative wage growth (for those who lost their Sunday penalty rates, so wealthier people can enjoy THEIR Sunday brunch at their local Cafe). No extra jobs have been created from the penalty rate cuts, as the government promised it would. Those workers who lost their penalty rates are still as productive as they were before, but now they're paid less. Meanwhile, Morrison is promising $11,000 tax cuts for high income earners - the thieving bastard!!!

    Whatever happened to the famous Aussie fair go? The less egalitarian we become the poorer we are as a society.

    Wake up Aussies! Lower taxes = service cuts = more crime. Every tax cut Morrison promises means less revenue to pay for health, age care & education. Then he has the gaul to ask Shorten where he's getting the money to fund election promises (like financial help for cancer sufferers)! Where's Morrison getting funds for HIS election promises? He's given it all away with his huge tax cuts to the big corporations & the very rich!!! Governments either have money from collected taxes or they don't have money to spend on essential services. The LNP are trying to turn us into America - YUK!

    Let's make Australia fair dinkum again & vote out the Liberals. They've done a terrible job these last 6 years. Why believe they will improve if they win the election? There's nothing to suggest they might improve, especially since they're doing preference deals with One Nation & Clive Palmer's circus. Imagine those clowns calling the shots if they hold the balance of power!!!???
    musicveg
    1st May 2019
    2:32am
    I agree Hoohoo, my life is never better under a Liberal Government, those who have done better are those who are wealthy already. One Nation and Clive Palmer are dangerous for this country too. Clive wants to support nuclear power! And he wants to dig up the whole country so he can make more money from mining while still not having paid for those workers who never go paid.
    Hoohoo
    3rd May 2019
    12:57am
    Actually, those nickel mine workers were paid $70 million with our taxes (via the federal govt), with $7 million still outstanding. That thief Palmer bragged he had $400 million to spend if he wanted to, yet he has the hide to stand for election & spending millions on advertising, while those workers still haven't been fully compensated & nor has the govt.

    The truly wicked & dishonest thing Palmer is now doing is to make out he's for this & for that & for everything, in an attempt to lure voters who are disenchanted with the major parties. I read one of his pamphlets & thought he was talking my language, with promises to address climate change & all sorts of environmental issues. Of course it's all just lies, but it seems people are falling for it. I heard he was attracting up to 15% of voters in Qld - it's terrifying how gullible some voters are.
    musicveg
    3rd May 2019
    2:00am
    And the Libs are preferences Clive now too!
    GrayComputing
    25th Apr 2019
    11:30am
    You do not know how long you will live.
    So it is not a good idea to rent a house if you already have a house with no mortgage.
    If you have a mortgage then it still slowly becoming and future asset for you.
    Renting is simply throwing money down the drain to make other people rich and richer.
    Nanna75
    25th Apr 2019
    12:03pm
    I agree with you, I never wanted to rent for that reason, but was unable to pay the mortgage and unable to buy another home outright because of my age, renting was my only option.
    Franky
    25th Apr 2019
    1:03pm
    That is an old cliche, money for rent going down the drain, enriching the landlords. Consider a landlord has costs like mortgage payment,ever increasing rates, astronomically high insurance, maintenance with trades people not being cheap and on it goes. If you can't afford to buy with a big deposit and pay a home off in a short time, you're better of to keep on renting and investing money in other avenues like shares or lending. Your return will bu much better than what property will give you. Do your sums!
    Farside
    25th Apr 2019
    2:15pm
    Franky is right. There are plenty of wealthy retirees living in rented accommodation and holding their investments elsewhere. The only good thing about buying is the forced savings that go with a mortgage enabling the buyer to build up capital.
    GrayComputing
    26th Apr 2019
    3:23pm
    Franky is talking about very rich retirees.
    Most of this sites members are not in that rich or super rich league.
    So stop being a landlord show off with your plum in the mouth pompous statements and get off this site
    Hoohoo
    29th Apr 2019
    6:19pm
    I'm sorry you had to give up your home, Nanna75, but glad to hear it's worked out well with your family arrangement. But has selling your home affected your OAP payments?
    Karl Marx
    25th Apr 2019
    11:47am
    Just read the "Flipside" & if you already own your home don't rent.
    Karl Marx
    25th Apr 2019
    12:00pm
    And people seem to forget that renting is not permanent. For some they may be able to rent for years on end but what happens if the landlord gives you notice which they are entitled to at any time once the contract period is up or before if there is any breach of contract.
    Then you have to search for accommodation which is time consuming & added cost. Then there are the added costs of leaving a premises like bond cleaning & carpet cleaning & possible rubbish removal etc & then the added costs of moving once new accommodation is found, bond payments etc.
    That doesn't happen if you own your own home outright
    Sundays
    25th Apr 2019
    12:10pm
    The other Flipside is that Landlords don’t always maintain their properties often doing the bare minimum at the lowest price. Our neighbours rented for seven years. The landlord refused to paint, so they did it themselves. Then, when it was spruced up, he gave them notice and sold up. Not an uncommon story. They were under stress to find something suitable. No thanks.
    Cowboy Jim
    25th Apr 2019
    12:13pm
    Good point SFR. But having moved 6 times because of work and every time we bought another place after selling the previous one I have my doubts looking back. Always had the feeling that rent money is dead money (often repeated at family gatherings). We do not see stamp duty, mortgage change costs etc. The days of one job for working life and a pension at the end of it are unfortunately no longer with us - the young ones have to be mobile and therefore rentals might be a better option. Buying a property is a saving vehicle if you cannot put any other funds aside.
    Franky
    25th Apr 2019
    1:09pm
    well said, Cowboy Jim! Successful economies discourage people from owning homes as it's ike putting down roots. Today's world is changing and the job opportunities with it. We're already moving on average location every 7 years, and the cost of moving is huge when you consider costs of buying and selling property. A bonanza for Real Estate Agents and lawyers.
    Young people today have realized that and are much more reluctant to purchase property - and it's not just because they can't afford to. It limits our freedom of movement and ties us down.
    Farside
    25th Apr 2019
    2:20pm
    It's not just the young that choose to be mobile. There are many retirees who want to temporarily live somewhere and have their capital invested elsewhere.
    Rae
    26th Apr 2019
    8:02am
    Those fortunate enough to be valuable to Corporations have lovely rental property supplied in the best locations in their contracts.

    It is best to move with the times. If the new idea is to just rent from professional landlords then that's the way to go.

    Obviously tenant rights will need ramping up and landlord responsibilities policed.

    Europe do it. A few landlords own just about everything and long term leases are the norm.

    Then you can move, have no responsibility, enjoy experiences like fine dining, travel, holidays etc and forget those silly saving ideas. It's just about luck anyway as we are told over and over.

    Get lucky.
    Aurora60
    25th Apr 2019
    12:12pm
    if the land is leased you cannot get any form of loan
    Sundays
    25th Apr 2019
    12:18pm
    Not sure what you mean? All land in the ACT is on 99 year lease, and people get mortgages all the time
    Sachka
    25th Apr 2019
    12:30pm
    Circumstances sometimes force your hand to rent, as was in my case. It turned out to be a challenge that eventually became a blessing. Always the downside at first, was that I may have to leave if the landlord changed the rent or something....didn't feel secure. But I had been blessed with a good owner and we both have settled to a respectful arrangement. Yes, things could still change, but I can't concentrate on that. I've protected myself as best I can, with a bit extra on the pension & a safe place to live in. A good backup system with health & social sevices( that challenged me to access) and good friends. The dreaded renting has become a way of life and I accept the way life has taken me from "secure" house owner to grateful renter.
    MICK
    25th Apr 2019
    1:43pm
    You are unique Sachka. Good to hear from somebody who is content with their life rather than demanding more.
    Farside
    25th Apr 2019
    2:33pm
    Hard to believe but there are landlords that are happy to do what it takes to keep a good tenant - maintain gardens, replace whitegoods, add air-con and solar panels etc. I know some who have rented the same place for almost 20 years; much of that time with owner living in the duplex next door until he passed away a few years back. The owner family were happy to keep the property ticking along and the tenants were happy to do some things any owner would do like replace carpets, add garden shed etc. A property deteriorates very quickly when not occupied.
    dolbt60
    25th Apr 2019
    12:32pm
    Iam a fortunate retired person
    Private rental at retirement is a difficult expenditure In 2003 well before my retirement I registered with our public housing authority I wasnt in a financial postion to have a large Superannuation amount to fall back on having had a divorce
    Iam now very happy to live in a nice area paying a lot less so Rental for me has been fine I have the rent taken from my pension payment So Privare renatal is out of the question for people like myself Iam now 76 I have owned property lost in a divorce there are a lot of well off retirees in Australia who have saved and saved married long term they dont need to rent
    MICK
    25th Apr 2019
    1:45pm
    Don't tell me: you are male and the house was awarded to your ex wife? That's how it used to play out in the 70s so I am guessing this is your story?
    Hoohoo
    1st May 2019
    1:33am
    Why jump to that conclusion, MICK?
    My niece (with two little kids) recently separated from her partner (a cheater who turned out to have a child with another woman, who he then moved in with). They had to sell their family home because of the large mortgage. He chucked in his high-paying FIFO job, out of spite (yeah, HE was the one who left her). He's been a proper bastard, falling behind on child payments, being a hopeless parent every second weekend when he has the kids (when he feels like it). Meanwhile, she's had to move in with her parents so she can work & study while the grandparents are the major care-givers of the kids. Luckily they are both up for it & happy to help.
    Divorce is crap for everyone, MICK. Stop feeling like you're the only injured party, because you're a male & lost money. Everyone loses.
    Franky
    25th Apr 2019
    12:54pm
    I would definitely consider renting. My ex partner even though she had the money decided not to buy a property but rent instead. I see now all the work costs and stress of home ownership which she does not have. If something goes wrong she rings the agent and it gets fixed. Also when I travel there is always that worry about the property as I have to leave it with someone to look after. The main impediment to renting in Australia is the lack of rental security, long leases over 6 months are just not common, and there is always the threat the property could get sold by the owner. This will require a cultural shift.
    Farside
    25th Apr 2019
    2:39pm
    An enlightened perspective Franky. Stronger tenancy laws, especially 3-6-9 leases, will help bring about the cultural change you mention.
    Rae
    26th Apr 2019
    8:09am
    Europe have strong tenancy laws and professional landlords and corporations that own the properties are policed.
    MissMuffitt
    25th Apr 2019
    1:24pm
    I will be retiring in about 3 years time, my partner is already a self-funded retiree. Before I retire, we intend to sell my house that we live in, in country QLD (Very low socioeconomic area, slow to sell houses!). We will rent in the town I work in until I retire. when we sell my house, the excess money from paying off the mortgage will go into my
    Superannuation fund.
    We will then put our furniture in storage, sell both cars and go on a bucket list trip to the UK for 3 months, after that we will Cruise back to QLD, purchase 1 car, and then find rental accommodation in Hervey Bay QLD. We have worked out that we are better to keep the $150,000 each of us would spend on going 1/2 in another house, in our Pension funds earning interest. At current rates, the money will initially earn enough to pay our rent.
    Farside
    25th Apr 2019
    1:56pm
    renting would be even more attractive for retirees and others if we had stronger tenancy laws such as 3-6-9 leases (three years with two three year options at choice of tenant), tenants rights to force landlords to maintain property, rent caps to prevent exploitation etc. These rights make renting an attractive option in europe.
    Rae
    26th Apr 2019
    8:13am
    Yes I agree. We need to get rid of the mum and dad landlords and those who don't really do the right thing. Eventually professional landlords and property corporations will replace them and tenancy rights be sorted out as in Europe.

    Moving the welfare state to the corporate state may have some advantages. Not having to save for decades to buy a home being one of them.
    Irish
    25th Apr 2019
    1:57pm
    I am fortunate that I rent in a housing co-operative. It is similar to community housing, but we are both tenants and landlords responsible for collecting rents and maintaining properties. When my husband and I separated there was nothing from the house we were buying to enable purchase of another, so I was forced into renting. I joined the co-operative when my children were infants, thereby qualifying for a 3 bedroom home. My children no longer live with me and I still reside in the same house as I cannot be evicted. While I would like to downsize, I would have to go to private rental and be prepared to pay at least $100 extra per week. To downsize within the co-op my only option is moving in to a 1 bedroom unit - no thanks; I still want the space. So, I know I am in a win-win situation with low rent and property being maintained and/or upgraded.
    Cowboy Jim
    25th Apr 2019
    5:21pm
    My sister, now 67, is in the same position overseas. Only possible when moving in with infants (considered social cases) and then you stay on till stumps. Only a few of us have that opportunity.
    musicveg
    25th Apr 2019
    2:14pm
    Do not rent, buy something smaller, renting is very insecure, rent goes up every year, I can only get 12 month lease at a time, even though I have been here over 10 years, they do not fix anything unless it is a real problem, no renovations, kitchen and bathroom need gutting but owners will not want to pay the money, and even paying the rent has become an issue of lately because they changed the system and now I have to drive 40 minute round trip to pay instead of paying via bank account, because they wanted me to join a third party to pay online which would charge me extra.
    Farside
    25th Apr 2019
    2:45pm
    rent goes up every year but so too do ownership costs - rates, maintenance and god forbid owners corporation (body corporate) fees. I have rented in between houses and the owner has maintained gardens, replaced the dishwasher and drinking water system, cleaned and serviced air-con and heating systems, and installed alarms in less than two years.
    musicveg
    25th Apr 2019
    3:10pm
    You are lucky Farside you get all the extra's for your extra rent, I get nothing. I don't have a dishwasher or even air con. It is an old 1970's house which needs a lot of work, I think they are just doing very minimal, even my neighbours keep asking when are they going to fix the eaves which are rotting away, I have asked the real estate many times.
    Farside
    25th Apr 2019
    11:04pm
    Yes we were lucky, and we know it based on the houses we saw for similar rents. As it happens house is owned by a foreign (Chinese) owner and his chief concern is for it to be well looked after. Was happy to give a 12 month lease and then month to month until our new house was completed so long as we give him 4 weeks notice. I forgot to mention he did a bunch of house maintenance at three month inspection - easing jammed windows, cleaning and repairing gutters, removing broken exterior blinds and more.
    Rae
    26th Apr 2019
    8:18am
    Professional landlords do maintain properties. It is only fools who buy and then let the house fall down through neglect. Too many of those after this latest boom but the correction in prices will sort that out.
    Farside
    26th Apr 2019
    12:31pm
    Spot on Rae, my landlord has engaged a profession property manager with the authority to approve anything up to $1800 without referring it the owner. BUt then again, my daughter's mum and dad landlord put in aircon without request at her flat. So as you said, be lucky.
    Aussie
    25th Apr 2019
    2:46pm
    ..
    Cowboy Jim
    25th Apr 2019
    5:18pm
    You might have something to say, Aussie, so spit it out!
    Paddington
    25th Apr 2019
    7:16pm
    Invisible ink lol
    Aussie
    26th Apr 2019
    3:36am
    Sorry ... nothing to say I already say all not only in this post but in many others .... Our beatiful country needs a rapid change to be able to have a better life for all ...... Pensioners or Not .... Just for All and is very hard to live on a day to day basis ...

    Sorry nothing else to say .....

    25th Apr 2019
    3:26pm
    In answer to the question put in the final paragraph, we would not consider selling up and renting. We are amongst that fortunate group that was able to retire owning our own modest home. As usual, I stress that this is what suits us and in no way am I suggesting that our answer is the only right answer.
    Rae
    26th Apr 2019
    8:21am
    Yes but remember a home owner needs substantial savings. Maintenance can be expensive. A new roof or verandah can cost tens of thousands.

    Rates, insurance, corporate body, maintenance, water It's a never ending cost whether you rent or buy.
    Sundays
    26th Apr 2019
    11:44am
    I like having my own home. I grew up in public housing and there was a lot of stigma. I like where we live, being able to decorate how we want and the basic security of not being beholden to a Landlord. Goodness, we worked and saved hard eneough! Yes, you do need money for repairs and capital replacement but worth it.
    cupoftea
    25th Apr 2019
    5:31pm
    What Mike said regarding the employment situation is correct 1peron fulltime job 38hrs with benefits security gets sacked 2 persons get the jobs no benefits casual employed from day to day now let start talking would you people who thinks that there is nothing wrong with the way that this country is Would you lend a person money to buy a 1 bedroom unit if that person did not know if they if were working the next WYF Now most of us on here a babyboomers so when we worked we hade the choice we are talking 60s70s80s etc so we had permant or causel we could get a permant job buy a house and we got that k nowing that we had the wages to cover it that was because of the AWARDS that wernt given they were fought for so all those people who seem to think this is great the the way this country is run good look down and hold your head in shame you had job security or some of you wouldn't know hard days work if it hit you head
    cupoftea
    25th Apr 2019
    5:31pm
    What Mike said regarding the employment situation is correct 1peron fulltime job 38hrs with benefits security gets sacked 2 persons get the jobs no benefits casual employed from day to day now let start talking would you people who thinks that there is nothing wrong with the way that this country is Would you lend a person money to buy a 1 bedroom unit if that person did not know if they if were working the next WYF Now most of us on here a babyboomers so when we worked we hade the choice we are talking 60s70s80s etc so we had permant or causel we could get a permant job buy a house and we got that k nowing that we had the wages to cover it that was because of the AWARDS that wernt given they were fought for so all those people who seem to think this is great the the way this country is run good look down and hold your head in shame you had job security or some of you wouldn't know hard days work if it hit you head
    Mikko
    25th Apr 2019
    6:44pm
    There is also the very real risk that Bill Shorten will be elected PM and as the Real Estate Institute warns, Labor's policy on capital gains tax and negative gearing will raise rents by $50 a week, plus add to the decline in house values (which is why investment owners will make up their out of pocket costs with extra rent. Happened under Keating who had to reverse it, so be warned!
    Paddington
    25th Apr 2019
    7:20pm
    Ha ha...negative gearing and franking credits have run their course.
    Good that house values will go down. They have gone up far too much anyway.
    cupoftea
    25th Apr 2019
    10:55pm
    Mikko Labours policy on capital gains and negative gearing is that if they get in office when they start those two polices any thing that is already n/ geared and if they sell capital gain would be the same as today the only thing you can negative gear is brand new building so that the older buildings will give the young first home buyers the same chance that we had and as far as rents are going up the real estate institute works for themselves
    cupoftea
    25th Apr 2019
    10:55pm
    Mikko Labours policy on capital gains and negative gearing is that if they get in office when they start those two polices any thing that is already n/ geared and if they sell capital gain would be the same as today the only thing you can negative gear is brand new building so that the older buildings will give the young first home buyers the same chance that we had and as far as rents are going up the real estate institute works for themselves
    Farside
    25th Apr 2019
    11:40pm
    the REI conveniently seem to overlook that there is a forecast shortage of housing for the foreseeable future despite the recent slowdown in construction. The traditional forces pushing up property prices of location, location, location will not change.

    And the alleged increase in rents when Hawke/Keating quarantined negative gearing have been well and truly debunked. Yes rents increased in Sydney and Perth however there was little impact across the rest of the country, rents actually declined in most capitals. It has since been determined that rents skyrocketed in Perth and Sydney because of sudden and substantial decline in construction commencements. Interest rates are now a fraction of those during 1985-87 and there is strong demand for new housing. Negative gearing has resulted in more competition by investors for existing properties but not enough increase in supply of rental accommodation. There is a good overview of the issues at:
    https://www.macrobusiness.com.au/2013/02/busting-negative-gearings-myths/
    Rae
    26th Apr 2019
    8:36am
    The Australian dollar is dropping. As natives are forced out of property ownership the professional landlords will buy in at fundamental values. They won't raise rents above market prices. They can still get tax concessions for loan interest as it will be a corporate entity buying the rentals.

    Anyone making income from property rentals as a business will still be able to negatively gear. But the mums and dads will be forced out.

    It was silly anyway. Owning one rental stops them receiving the Aged Pension but the rent after costs isn't enough to live on. There is no liquidity either. You can't just sell off a bedroom if you need cash. Yields of 2% make having the money in the bank a better idea.
    nan
    25th Apr 2019
    7:23pm
    One option is to buy a house in a retirement village where you lease the land and pay site fees.That way you get rent allowance. You pay no rates. My friend paid no entrance fees and will pay no exit fees. Because you are classed as a non homeowner you can can have more saving before your pension is affected.
    Cowboy Jim
    25th Apr 2019
    7:33pm
    Right, nan, but your house is most probably not worth much to leave to your children if so inclined. That is why a lot of people shy away from them. I do not have children so your idea certainly has appeal. Any investment with no rates payable have a downside, so check out the small print.
    Rae
    26th Apr 2019
    8:39am
    Some villages are rent only and you don't have to buy in. The rents are quite cheap as well. I think the company is called Green Villages or something like that.
    ardnher
    25th Apr 2019
    8:02pm
    renting a housing commission home is fine..private renting no good as you are at mercy of greedy landlords
    SuziJ
    26th Apr 2019
    11:55am
    Housing will only give me a 1 bedroom place (for me only), and I have to move into town where they have all their units. I live in a suburb out of the centre of town, in a 2 bedroom unit, across and down the road from my carer and housing want me to move at least 15-20 minutes away from him! No way!

    I've recently had a medical emergency and if my carer had to get into town, the ambos would've had to be waiting for a long time just for him to let them in, as I couldn't get to the front door as I couldn't walk!

    The same problem would be an issue if I needed to get to medical appointments. My medical clinics are just down the road in my suburb, and having to go from my home in town to the doctor and then home again would add at least another 50 - 60 kms per week to my carer's road trip, as my he would have to come into town and collect me, then take me to the appointment, take me back home and then go home himself - such a ridiculous situation!

    My carer is not on the housing list, and would have to wait around 10 years to get a property, so I'm better off where I am, both of us are paying private rental.
    Barbara Mathieson
    25th Apr 2019
    9:27pm
    Well, I guess I must be lucky!

    Have been renting privately now for 5 years. I am a solo, senior lady with a good landlord and yearly tenancies. Seems to be ‘ glut’ of units in my city so perhaps this helps my situation?

    Sold my original home some years ago . Moved in with son for a while but decided I’d rather just rent a smaller unit elsewhere.

    Have a small super only now after some travelling , so rebuying wasn’t an option.

    Found a lovely, serviced ‘ shoe box’ , close to public transport ( I still drive) , water views, at a reasonable rental. I have lovely apartment facilities like a pool, gym / spa!
    Car parking included and good security/ reception/ postal service.

    I receive rental assistance which further helps my situation.
    My landlords maintain my ( their) unit well, and I look after it well for them.
    So we are both really helping one another!

    I ‘ suffer ‘ their 3 month inspections easily!

    My unit is serviced which means it is fully furnished. I downsized years ago , as I couldn’t see the need to keep all my ‘stuff’!

    Of course I have to watch my finances, but still go out socially and manage small trips away.

    I pay a small fee for am apartment cleaner once a fortnight.

    I don’t pay for water , nor any service costs.

    I am quite happy to have just 1 bed, 1 bathroom, and 1 toilet !
    I make good use of any social networks in my city , belong to various clubs and do volunteer work.

    I realise this arrangement wouldn’t suit everyone, but works well for me.

    I am not too concerned if for any reason my landlords decided to sell as there are other units in same block available for permanent rental also.

    I would simply ‘ move on’!!
    Rae
    26th Apr 2019
    8:42am
    Sounds like the perfect solution. Well planned and this sort of arrangement will increase in popularity. There are great benefits to not having ownership of property and all the stress and costs involved.
    Hoohoo
    1st May 2019
    1:48am
    Wow, Barbara! It sounds like you live in a great place. What town?
    SuziJ
    26th Apr 2019
    11:40am
    More to the point, rental properties (in Albury/Wodonga), at least, for retirees are only single bedrooms! Not good for me, as I use the 2nd bedroom as my study, and a 1 bedroom unit would be far too small.

    The retirement villages for people who have the funds to purchase their properties have at least 1.5 - 3 bedrooms! The 1.5 rooms are a bedroom and a large enclosed verandah-type room, which can be used for a computer, craft or whatever room you like.

    If you're renting, then the government (usually) gives you rent assistance, which covers 80% of my weekly rental expense, and I have to come up with the extra 20% and the second week's rent out of my pension, so I'm not much ahead of a home owner.
    KB
    26th Apr 2019
    1:09pm
    For many of us renting is not a choice but a necessity. It s harder for people to find affordable rent
    KB
    26th Apr 2019
    1:09pm
    For many of us renting is not a choice but a necessity. It s harder for people to find affordable rent

    26th Apr 2019
    11:10pm
    Labor's new taxes must drive up rents.

    https://www.heraldsun.com.au/blogs/rita-panahi/labors-reckless-housing-policy/news-story/aa6dd9eb77bab2169eee2f0ee1bcda42
    Karl Marx
    26th Apr 2019
    11:23pm
    I believe the market would dictate rents & not government policy which would have little to do with rents especially the abolition of negative gearing which mostly benefits the wealthy.
    Actually it doesn't go far enough & should be totally abolished come 1st July 2019 just like FC's
    musicveg
    26th Apr 2019
    11:44pm
    Who owns the Herald Sun, isn't it Rupert Murdoch?
    Karl Marx
    27th Apr 2019
    12:37am
    Sure is musicveg, say no more
    Anonymous
    27th Apr 2019
    10:50am
    Mass immigration drives up demand.

    Shorten's new taxes increase the costs of supplying rental housing.

    Shorten's capital gain increase dramatically reduces any hope of a future nett gain. It was this hope that encouraged owners to take low (or negative) earnings today for a possible increase down the track somewhere, maybe.

    Isn't it Economics 101 that higher risk demands a higher return and in the present day - which a bank manager will be insisting upon.

    So, why would a tenant be expecting the owner to be providing the welfare assistance that should be coming from the government, and again, why would a bank be stumpting up for a loan that (after Shorten's taxes) cannot be justified?

    BTW, what plans and costings has Shorten declared to provide the low income and welfare shelter that successive federal governments have buck-passed to the privte sector?
    ex PS
    27th Apr 2019
    8:46am
    If I did not own my home outright and retired with a good lump sum in the bank or Super Fund I would not waste it on buying one. If you rent you can move countries or states whenever you like and do not have the annual overheads that property involves.

    Of course renters pay all those fees, but they are paid in easily met weekly, fortnightly or monthly payments.

    You can't take money or assets with you when you go.
    Aussie
    27th Apr 2019
    10:53am
    ex PS ...totally agree ,,,,live easy and in peace
    Anonymous
    27th Apr 2019
    11:20am
    Where they had been prudent financial budgeters for their entire lives and applied themselves to buying in season and growing some of their own produce, my grandparents' generation were the last generation who were able to live their lives out in the home in which they had raised their family.

    My mother's generation (she passed on at 95 some five years ago) were not usually able to do that ever where they made all compromises such as ceasing all insurance and living like church mice. The user-pays and other effective increases in federal, State and local government taxes, many made necessary by the requirement to build infrastructure for 'Big Australia' population increases, but also the government pressure to move from their land now wanted by gen X etc, required that they trade-down or sell and rent. Some here have noted the same applied to them.

    Shorten's interferences in the market and all aimed solely at collecting new taxes can be expected to push many more previous home owners (seniors) onto the rental market. That and the effect of Shorten's large tax increases anyhow WILL see big increases in rents. It is easy to imagine that many will see no worth in buying and starting again where the odd are stacked againt them (the banks will not be lending them the money).

    So I believe that many will spend the money and lifestyle, enjoying what mobility they have left and then joining the OAPs. So much for that independent life they scrimped and saved for.
    Anonymous
    27th Apr 2019
    11:22am
    Sorry for a few typos. No editing facility and it is not worth redoing it.


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