It’s a common belief that many older Australians own their own homes outright.
However, the reality is many older Australians are increasingly renting or still carrying a mortgage into retirement and are facing some unique challenges when it comes to housing.
A recent study by Swinburne University in Melbourne found some “urgent housing challenges” for older Australians.
The study, Not poor enough, not rich enough: older people falling through the housing assistance eligibility gap, claims urgent demand exists to fix a failing system.
The report claims the growing number and proportion of people aged 55 years or older unable to afford homeownership, coupled with an increase in older Australians entering fixed-income retirement, has resulted in a considerable rise in those living in private rentals and carrying a mortgage into retirement.
Unstable housing
There are a few problems with this – private rentals can be unstable housing, rents are increasing above indexation, public housing is scarce and financial institutions can be reluctant to lend older people money for mortgages.
“These people are neither poor enough to qualify for housing assistance nor wealthy enough to secure housing as they age, highlighting a significant gap in Australia’s housing system,” the report said.
The study named this cohort the ‘Missing Middle’ and claims little is being done to secure housing for when they most need it. It is estimated that just over half a million Aussies fall into this category, though the report claimed the figures it used ‘likely understate’ the scale of the issue.
According to the report:
- 60 per cent of the Missing Middle live in private rental homes, and a majority (78 per cent) of these renters are in the very low or low-wealth category.
- Most of the Missing Middle with very low to low wealth are in the lowest two household income brackets.
- A large proportion of this group receives Commonwealth Rent Assistance.
- Additionally, 61 per cent of this group lacks superannuation coverage.
- About 25 per cent of the Missing Middle live in mortgaged homes, and 85 per cent of them fall into the moderate wealth category.
- In the 55-64 age group, two-thirds (66 per cent) are employed, while 81 per cent of those aged 65 or older are not in the labour force.
“Housing insecurity for older people is driven by systemic and macro-economic factors, including the heavy reliance on homeownership for housing security, a shortage of affordable housing, insufficient social housing and barriers to accessing loans,” the report found.
“These issues are compounded by individual challenges such as divorce, illness and gendered financial disadvantages.”
How can we fix it
Unfortunately, due to the complex issues involved, the report found there was no possibility of a ‘one size fits all’ solution and that more public and community housing was ‘essential’.
“Generic, non-targeted and market-based housing solutions are not delivering the forms of affordable, adequate, secure housing that are needed to enable older people to live with dignity and to thrive as they age,” the report found.
As well as more public and community housing, more radical proposals to ease the crisis include housing co-operatives, shared living, intergenerational living and more independent living units.
However, as the past few decades show, governments of both persuasions are reluctant to improve public housing or interfere in the private market to encourage different housing models such as co-operatives.
The report also suggested:
- removing age-based discrimination by financial institutions
- improving options for shared ownership
- building a suite of independent living housing options to rent for life
- increasing the number of not-for-profit retirement homes
- more options to encourage downsizing for people with mortgages.
“What I would like to see is a really big push by the government to make a massive amount of one-bedroom units, and they don’t have to be fancy units,” said one survey participant, ‘Beverly’.
“But one-bedroom units, which would house single people or a couple, you know, in older age. … A cheap option like a free prefab. Just in the interim period, you know, while we have such a huge amount of people who are desperate for housing, particularly older single people.”
What improvements would you like to see in the housing market? Why not share your opinion in the comments section below?
Also read: Stats show over-50s make up two-thirds of public housing residents
