Growing numbers of renters aged over 50 have been ignored in last week’s Australian Budget, with calls to support the emerging build-to-rent sector, increase the supply of affordable rental housing or boost rent assistance payments going unheeded.
In its pre-budget submission, advocacy group National Seniors argued that Commonwealth Rental Assistance payments should be increased by at least $10 a week, and that the Australian Government should fund retirement living projects which provided rentals.
Meanwhile, unions and major construction companies have been calling for government tax changes to make it easier to build rental-only housing projects (known as ‘build to rent’).
Because build-to-rent projects are dedicated to rental accommodation, with all units owned by a single entity, they are considered to provide valuable ongoing lease security for over 50s renters.
This compares to renters who occupy general housing, who face being evicted when ‘mum and dad’ landlords return to occupy, or sell, the property.
However, the budget’s housing measures only benefitted current and potential future homeowners, including reducing the eligibility age for the downsizer superannuation scheme and expanding the government’s home equity release scheme.
The budget also included new and expanded low-deposit purchase schemes for first and single parent home buyers, along with increasing the amount that first home buyers can release from their superannuation from $30,000 to $50,000.
In his budget speech, Treasurer Josh Frydenberg said that “under the Coalition, home ownership will always be supported”, while also noting the government’s existing $2 billion investment in affordable housing through the National Housing and Finance and Investment Corporation.
National Shelter Executive Officer Adrian Pisarski said the budget measures will further stimulate demand in a heated market, without a commensurate additional supply strategy.
It will put ownership further out of reach for the many while benefiting the few,” he said.
“They are conducting lotteries for deposit programs ensuring the great Ponzi scheme of housing continues where the benefits accrue to existing owners not hopeful ones”
In his budget in reply speech, Opposition Leader Anthony Albanese promised a $10 billion Housing Australia Future Fund, to build around 20,000 social and affordable housing properties over five years.
Mr Albanese said some 4,000 of the 20,000 properties would be allocated to women and children experiencing domestic and family violence and older women on low incomes.
The budget settings follow comments last year by prominent Liberal MPs opposing long-term rental housing models.
Differing views on build-to-rent model
Ahead of last year’s budget, Liberal backbencher Tim Wilson criticised the build-to-rent model, arguing in the Australian Financial Review that: “Build-to-rent is a deliberate promotion of dependence in life, which is anathema to the trade of Australian liberalism that is anchored in individual empowerment and independence.”
This position differs to comments by NSW Planning Minister Rob Stokes at the launch of a Mirvac build-to-rent project in Sydney in August last year, who said: “This (project) redefines what home ownership means.”
To have a home, a home is not just a piece of paper with a title with a second schedule with your name and mortgage. Build-to-rent is about housing justice.”
The number of Australians who are private renters and aged over 55 is expected to increase from 647,584 people in 2016 to 1.110m in 2031 - a jump of 72 per cent. Over the same period, there will only be a modest 13 per cent increase in over 55 homeowners.
Last year’s government Retirement Incomes Review made it clear that Australia’s retirement system was not serving the increasing number of people entering retirement as renters.
The retirement income system does not appear to be delivering an appropriate standard of living for many retiree renters,” the report says.
“Owning a home has a positive influence on a person’s standard of living in retirement...whereas, in retirement, renters have higher levels of financial stress.”
Comment from our CEO
Commenting on this story, Downsizing.com.au CEO Amanda Graham said: “We are experiencing very high and increasing demand for affordable rental accommodation for seniors.”
“Older women are particularly at risk of homelessness due to lack of superannuation savings, unemployment and divorce, after a lifetime spent caring for others.
“We set up our free Senior Flatmates listings to help address this demand, and we strongly support the development of new models of housing to meet this growing need within an ageing demographic.”
Find out more
- Forget ‘The Young Ones’: How it’s renting seniors that are driving a new boom in group household living
- Innovative rental options available for Australians over 55
- Australia’s largest rental-only towers trigger downsizer rush
Downsizing.com.au has Australia's largest range of rental properties suitable for over 50s - check them out here