The traditional concept of retirement living is undergoing a facelift of sorts as Australians are living and working longer. Traditionally, the concept of ‘downsizing’ has been based on people who are retired from work, no longer have dependents, and are in a position to sell the family home to move into more age-appropriate housing – often referred to broadly as ‘Retirement Living’.
Over the last few decades, however, more and more people have been putting off full-time retirement well into their 60s and 70s. So much so that the percentage of employed Australians over 50 hit record levels in 2021, according to figures released by the Australian Bureau of Statistics (ABS) earlier this year.
More Australians working longer than ever before
According to the 2022 ‘Working Seniors’ Research Brief released by Downsizing.com.au, employment to population ratios for the 60-64 and 50-54 age group are the highest they’ve been since the dataset was first recorded in 1978. Similarly, ratios for the 55-59 and over 65 age brackets have reached near-record levels.
As of December 2021, some 3.99 million Australians over 50 were employed in either full-time, part-time or casual work. If the trends of the past decade continue, this figure is expected to increase to 5.2 million people by 2031. The number includes 1.17 million people over the age of 65 and is an overall 28 per cent increase on 2021 figures.
Why are older Australians putting off retirement?
According to ABS reports the trend is closely correlated to the meteoric rise in house prices starting in the 1990s. This can be seen in the rising percentage of older Australians who are working to pay off mortgages.
Other influences include:
- Australians are not only living longer but are also healthier.
- More over-50s have access to better education than generations past, meaning more work in less physically demanding jobs and can continue to work into later life.
- Skills shortages and the rise in popularity of remote work related to COVID-19 has influenced higher employment levels in this age group.
- The increasing pension age is likely to have driven the need for more older Australians to work longer.
- At a time where many self-funded retirees have seen a hit to their superannuation, many are looking to supplement income during times of economic and investment uncertainty.
What this means for the ‘Retirement’ Industry
According to the Downsizing.com.au research brief, the rising number of older working Australians is likely to see some positive developments for the nation’s over-50s housing industry in coming years.
Some of the more prominent trends we can expect to see include:
- The introduction of more financial products to assist over-50s mortgage holders to be able to transfer part of their debts when moving into age-appropriate housing. One such product which recently came to market is the introduction of ‘land lease home loans’.
- More retirement living providers offering home designs with study nooks and multi-purpose rooms, along with communal workplace facilities.
- Pressure on some State Governments to change their definition of ‘retirement villages’ to better cater for full-time working seniors.
- Rising number of employed over-50s is likely to see a ‘retirement’ of the term ‘retirement living’, with the industry moving towards more inclusive terms like ‘downsizer-friendly’, ‘third-age’ or ‘lifestyle’ housing.
The undisputed benefits of ‘lifestyle’ and ‘retirement’ communities will continue to be popular with Australia’s ageing population. The future focus of over-50s communities will continue to be more about lifestyle than retirement with an emphasis on facilities and services allowing people to continue working alongside places of leisure and relaxation.
Thinking about downsizing? Learn more about the Hampshire Lifestyle Village difference.
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