Downsizers are flocking to land lease communities during the COVID-19 era, in part because they can avoid stamp duty and purchase new homes up to 70 per cent cheaper than surrounding existing dwellings, a new report has found.
Downsizing.com.au today published a report tracking the current trends in Australia’s booming over 50s land lease community industry
In a land lease community, a buyer purchases a dwelling and then secures a long-term lease on the land on which the dwelling sits, usually from a community operator. This means no site-specific stamp duty or council rates are payable.
The report finds the COVID-19 pandemic has accelerated the already strong growth of Australia’s land lease community industry.
The report finds that, even before COVID-19, the land lease community model had a number of strengths, including that buyers could:
- Avoid stamp duty, council rates and pay no or lower exit fees
- Use Commonwealth rent assistance payments to subsidise the cost of ongoing site fees
- Access housing in lifestyle-rich regional areas, usually at a discount to the median house price in the surrounding area
- Access an expanding range of on-site sporting, social and lifestyle community facilities
- Move into modern and well-designed homes
Land lease communities have benefitted from a number of COVID-19 induced marketplace trends, including:
- Internal migration towards regional areas
- A strong property market enticing over 50s to sell their family homes
- Increased community acceptance of remote working, which suits the growing number of younger downsizers moving into these communities
- More buyers wary of being isolated in their suburban homes and instead wanting to live independently within dedicated downsizing communities
Downsizing.com.au CEO Amanda Graham said the above factors mean that land lease living is quickly moving from a niche to a mainstream housing option for Australia’s over 50s, including from those looking for a later life housing option which is both affordable and supports their gradual transition to retirement.
“It’s clear that land lease communities are offering what buyers are looking for in the COVID-19 era, as property prices escalate and people want an alternative to being isolated in their suburban homes,” Ms Graham said.
“In the wake of this increased consumer interest, we’re seeing major companies coming into the industry, and existing operators ramping up development activity.”
The Downsizing.com.au report analyses the prices of new homes in eleven land lease communities in NSW, Victoria and Queensland, compared to the median house price in the surrounding suburb.
The report finds that new land lease homes were between 13 to 70 per cent cheaper than surrounding houses, while additional stamp duty savings ranged from $2,120 to $18,362.
Across Australia, land lease communities are known by different names, depending on the relevant State or Territory legislative scheme and the chosen marketing term used by operators.
This means you’ll see land lease communities also described as residential parks, manufactured home estates and lifestyle communities.
The report focuses on land lease communities which are open, or marketed to people aged 50 years and over and can be found here.
It features analysis of communities from the following operators:
Find out more: