Over 55s lifestyle resorts could be part of the solution to the nation’s housing crisis by freeing up more properties for families, according to the nation’s peak retirement living body.
Retirement communities have seen a significant increase in popularity, as the population ages, and people start to downsize.
Eighty-one-year-old Glenys Kirkwood downsized eight years ago, and now lives in Taramind Place, an over-55s estate at Rockhampton in central Queensland.
She never pictured herself living in this sort of community, but now can’t imagine herself being anywhere else.
“There are facilities like a swimming pool, spa, and we have our own movie theatre. There’s our own gymnasium, and there’s a very large clubhouse that I have certainly used on more than one occasion for family events.
“I’ve celebrated birthdays here, my family had their Christmases here,” she said.
In Australia, there are approximately 2 million people aged over 75.
That figure is expected to grow to 3.4 million over the next 20 years.
Retirement Living Council (RLC) is an arm of the Property Council of Australia. Its executive director Daniel Gannon said the retirement sector could play an important role in Australia’s broader housing eco-system.
Industry forecasts predict 18,000 retirement dwellings will be built from 2023-2030.
A report commissioned by the RLC, published in November 2023, stated this would reduce Australia’s housing shortage by 18 per cent to 2030.
The report also found that if a further 49,000 units were built, it would reduce the housing supply gap by 67 per cent.
“Older Queenslanders can free up a lot of capital when they consider moving into a retirement community. But they are also helping ease Queensland’s housing crisis by freeing up more homes in the middle of the market for younger Queenslanders,” Mr Gannon said.
Retirement living isn’t residential aged care
“Retirement community” is an umbrella term for over 50s lifestyle resorts and retirement villages.
They are made up of private homes that are independent living and communal facilities for recreational activities — including pools, community centres, gymnasiums and other sporting facilities.
Residential aged care, on the other hand, is for seniors who require round-the-clock medical care and supervision. This is described as supported living.
A retirement community is typically driven by a lifestyle choice while residential aged care is needs driven.
According to 2021 Australian Bureau of Statistics data, almost 250,000 Australians live in retirement communities — an increase of 24 per cent compared to five years before.
Across Australia, there are 458 operators of retirement communities, with more than 200,000 independent living units (ILUs), the RLC report stated.
‘Be careful when looking at contracts’
A retirement community will include an initial entry payment, regular service fees to cover general management and maintenance. Some operators require an exit fee on departure.
They will typically be self-funding through personal funds, superannuation or the age pension.
“I would advise people just to be really careful when they are looking at contracts that they benefit them and not the corporation that owns the place,” Ms Kirkwood said.
“We pay a fortnightly fee that covers our rates and water [but] I pay my own electricity and gas.
“It still to me is a reasonable value for what I’ve got.”
The entry price of an ILU is on average $516,000. Some 57 per cent of units are on loan lease, 37 per cent are on a loan license and 11 per cent are on strata or freehold title.
The RLC report found the average cost for a two-bedroom unit in greater Queensland is 53 per cent cheaper than the median house price in the same postcode.
“These homes are an affordable housing solution in what is otherwise an unaffordable housing market right across the country at the moment,” Mr Gannon said.
The RLC is lobbying the federal government to change classifications to increase the eligibility of retirement community residents for the Home Equity Scheme and Commonwealth Rental Scheme. That is because the Department of Social Services does not recognise this tenure as home ownership.
‘Absolutely ideal’ when downsizing
Ms Kirkwood said the estate had everything she wanted in one spot, and she had not regretted the move.
“The external gardens are completely looked after by the establishment and I’ve only got a very little garden in the backyard … it’s quite sufficient for me to cope with,” she said.
It also gave her a sense of community and friendships with people she usually wouldn’t have crossed paths with.
“I am about to head overseas with a couple of fellow residents later in the year,” she said.
“There’s activities during the week that I can join into if I want to and don’t have to if I don’t want to.”
She said anyone hitting 50 or above should consider the move.
“If they are looking to downsize anywhere … it’s absolutely ideal,” she said.
The RLC report found people in these estates had better health outcomes than those who remained in their homes.
Government funding for more developments
It found that residents of retirement communities were 20 per cent less likely to be hospitalised after nine months of living in one and were healthier, happier, more social and less depressed.
It also said these communities could save the federal government $1 billion every year by keeping people out of taxpayer-funded aged care facilities for longer.
The Queensland government announced last month a $350 million fund to support and cover known infrastructure costs of market-ready housing projects, which could include retirement community developments.
Mr Gannon welcomed the announcement, saying it was a great step, along with the proposal of a new streamlined and fast-tracked approval process.
“There are a number of retirement village developers across Queensland who constantly face unnecessary delay when it comes to the planning system,” he said.
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