Five Smart Ways To Downsize

There’s more than one way to downsize, and a few options should be of interest to developers targeting this growing market.

Option 1 – The sea or tree change

Not all downsizers want to significantly reduce the scale of their home. Some are looking chiefly to upsize their retirement savings, and this can be done by moving to a less expensive area.

Sea and tree change locations can often make this possible. Research by super industry body ASFA found a downsizer moving from metropolitan Sydney to Forster-Tuncurry on the NSW north coast, can potentially pocket $650,000 – the difference in the median house price between the two markets. [1]

It makes regional markets with decent facilities including medical care, a place to watch for developers.

Option 2 – An apartment with room to move

Downsizers still want room to play, relax and enjoy life – they just don’t want responsibility for maintaining it all. Apartments can fulfill this wish list. But it doesn’t mean downsizers will gravitate to small apartments – far from it.

Research shows downsizers typically move from three- and four-bedroom dwellings to two- and three-bedroom homes – not single bedders. It’s not a problem if the unit doesn’t have space to have a barbecue or hold gatherings – as long as the complex itself offers areas for these.[2]

Apartments that incorporate retail and dining precincts are popular, allowing downsizers to remain connected to their community and socialise with friends and family.

Option 3 – The granny flat

Multi-generation living is on the rise, increasing by almost 32% in the last decade. Studies show one of the most common scenarios is grandparents living with the core family unit due to their need for care or to help raise their grandkids to save on child care costs. [3] It can also be a practical way for parents to help their children get into the housing market.

It’s a trend fueling demand for larger homes with self-contained grandparent accommodation, including duplexes and backyard granny flats.

Option 4 – The motor home

Pay a visit to a local camping ground and chances are you’ll come across a plethora of silver-haired travelers, wheeling their way around the country in a fully kitted out motor home complete with satellite TV.

It’s not uncommon for retirees to trade their home for a Winnebago and head off around Australia. What’s less clear is what happens after these downsizers complete their first lap of the nation. Nonetheless, it shows that for many seniors, retirement is a time when travel goals are taken very seriously indeed. Parking for the Winnebago or the caravan may be the clincher when selling the family home and downsizing to a new lock up and leave home base.

Option 5 – Migrate overseas

Sun, sand, blue skies and a very low cost lifestyle. It can be very appealing for cash-strapped retirees, and around 80,000 Australians are living overseas while still claiming an Australian Age Pension. Favoured spots include Italy, Greece and New Zealand. [4]

Even if permanent migration isn't on the cards, extensive and lengthy regular overseas trips may well be – so again, a low maintenance, low hassle, lock up and leave home base is essential.

The nub of all this, is that downsizing means different things to different people.

Developers need to bear in mind that there is no such thing as the “typical” or “average” downsizer. Aiming to cater for a range of clients and differing needs is one of the best ways to get this demographic on board.

 

[1] https://www.superannuation.asn.au/media/media-releases/2017/media-release-5-december-2017

[2] Downsizing amongst older Australians, Australian Housing and Urban Research Institute at The University of New South Wales, 2014

[3] McGrath Report 2018

[4] http://www.smh.com.au/national/struggling-pensioners-opt-to-leave-australia-for-a-cheaper-country-20140607-39pui.html