Retirement living construction activity levels are forecast to continue to lead the way in Australia, as prices, materials and labour continue to drive uncertainty.
The latest Property Council Survey reveals Australia’s retirement living industry continues to forecast strong confidence around capital value growth and construction activity over the coming 12 months.
However, Retirement Living Council Executive Director Daniel Gannon sounded caution on several fronts.
“There is still much uncertainty across property sub-sectors, with construction prices, materials and labour continuing to drive uncertainty,” Mr Gannon said.“The other x-factor is legislative reform, which is taking place in every corner of the country and impacting two thirds of Australia’s retirement living markets.
“If these reforms make it harder for operators to build and operate age-friendly communities, it could tighten the supply clamp at a time when confidence remains high, construction activity has a strong pipeline, and when the nation needs housing,” he said.
Mr Gannon said retirement construction activity is expected to be at historically strong levels, outperforming other sub-sectors, and forecast to be greater than residential, office, retail and industrial activity combined.
“However, we know that the development supply pipeline planned for the next three years is forecast to fall by more than half, largely a result of local planning systems and legislative frameworks that could constrain supply,” Mr Gannon said.
“If governments around Australia create investment and development environments that facilitate more supply, the sector is geared up to do it,” he said.
Mr Gannon said retirement living could play an important role in housing Australia’s rapidly ageing population, particularly as the nation battles an ongoing housing crisis.
“While the demographic and housing outlook is potentially grim, there is a solution to this crisis,” Mr Gannon said.
“The more than 2,500 retirement villages across the country can allow residents to maintain their independent lifestyle as they age, while still enabling them access to care, support services and community.
“Given the number of people aged 65 and over will increase by more than 50 per cent to 7.1 million over the next two decades, we need to capitalise on a sector that is ready, willing and able to provide more homes for older Australians,” he said.
About the RLC
The Retirement Living Council is the national leadership group for the retirement living sector, championing policies that deliver age-friendly homes and better services in retirement communities.
More than 260,000 senior Australians live in approximately 2,500 retirement communities across the country, with an over-75s market share of 12.6 per cent.
There are 4.6 million people around Australia aged over 65 today - this number will grow to 7.1 million by 2043.
Importantly, the sector generates almost $3.5 billion in annual savings to governments through reduced interaction with healthcare systems and delayed entry to aged care.
The RLC sits within the Property Council’s national advocacy team and is the most powerful voice of the sector, representing national retirement village and senior living community operators.