realestateview.com.au baby boomers...
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REALESTATEVIEW.COM.AU BABY BOOMERS REPORT
JULY 2014
ABOUT THE BABY BOOMERS REPORT
• Commissioned by realestateVIEW.com.au in July 2014, a survey was
conducted of 2,554 baby boomers via an online questionnaire. Of the
respondents that specified locations, the breakdown of locations was as
follows: VIC (47.9%), NSW (21.20%), QLD (10.7%), SA (7.0%), WA
(6.5%), TAS (4.7%), ACT (0.8%), NT (0.67%).
• The survey asked baby boomers aged 50-69 to respond anonymously
to 24 questions about their perspective on the property market, as well
as their lifestyle aspirations in retirement.
• The survey sought to obtain a comparative overview of baby boomers
sentiment on the housing market, lifestyle preferences, affordability
concerns and their plans for retirement
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DEMOGRAPHIC SNAPSHOT
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81%
19%
Have children
No children
0% 20% 40% 60% 80% 100%
39%
68%
Male
Female
0% 20% 40% 60% 80%
CURRENT LIVING SITUATION
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• Nationally, 47.5% of baby
boomers are still living in their
long term/family home
• This was higher in
Victoria at 50.7%, but
lower in NSW at 44.3%
• 30% are living in a house that isn’t
their long term home
• A minority are living in units (7.8%)
apartments (5.8%) or townhouses
(5.4%). However, apartment living
was much more popular amongst
NSW baby boomers - more than
double (10.9%) than their VIC
counterparts (4.8%)
• “Other” responses included
farms/acreage, granny flats or
living with family,
caravan/relocatable homes
CURRENT
LIVING
SITUATION
National Victoria NSW
Family home (long-
term/house in which
they raised a family) 47.5% 50.7% 44.3%
House (not family
home) 30.0% 27.6% 28.8%
Apartment 5.8% 4.8% 10.9%
Unit/villa 7.8% 7.6% 8.4%
Townhouse 5.4% 6.8% 5.5%
Other 3.5% 2.5% 1.9%
AFFORDABILITY: PROPERTY PREFERENCES AND CONCERNS ABOUT THE MARKET
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BUYING PROPERTY
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OWNERSHIP
STATUS National Victoria NSW
Rent your home but
are looking to buy in
the near future 11.1% 9.5% 12.8%
Rent your home and
are not looking to buy
a property 8.9% 6.8% 10.9%
Rent your home but
own an investment
property 2.0% 1.8% 1.7%
Living with family but
looking to buy in near
future 4.8% 5.1% 3.1%
Living with family and
not looking to buy 3.5% 3.5% 5.5%
Own your home, not
looking to buy 34.8% 36.2% 32.9%
Own your home, are
looking to buy in the
near future 34.9% 37.2% 33.1%
• Baby boomers are divided
between those who plan to
move and those who want to
stay put.
• Half of baby boomers (50.8%) are
currently looking to buy property.
• The remainder are divided
between those who want to stay
in their current home and those
who are stuck on the rental
roundabout
• Reflecting the affordability
concerns of baby boomers, one
fifth are renting, and 8.9% have
no intention to buy property
• With Sydney house price growth
leading the nation, baby boomers
in NSW appear to be hardest hit
by affordability. The proportion of
renters in NSW (25.3%) was
higher than the national average
(22%) with just one tenth (12.8%)
of these in the market looking to
buy
HOUSE PRICES
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Price range National Victoria NSW
<$400k 36.6% 29.8% 32.3%
$400-$600k 30.2% 29.1% 30.7%
$601-$800k 16.2% 19.8% 15.7%
$801K-$1million 8.6% 10.4% 10.9%
>$1million 8.3% 10.9% 8.5%
• Contrary to the belief that baby
boomers will retire on property wealth
and superannuation, their choice in
property tells a different story:
• The majority are looking for property in the
lower to mid price ranges and are
concerned about current house prices;
only a minority (8.6%) are searching for
property in the million dollar range.
• Two thirds of baby boomers (66.8%)
nationally are looking to buy for under
$600,000, with over half of these looking
for property under $400,000.
• Victorian baby boomers appear to be the
most affluent. While NSW was on par with
the national average, there were more
Victorian baby boomers looking for
property in the higher price ranges of
$800,000-$1million and over $1million.
TIME IN MARKET
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Time in market National Victoria NSW
<3 months 31.5% 29.5% 29.8%
3 to <6 months 15.6% 16.1% 16.9%
6 months to 12
months 14.4% 15.3% 15.3%
1 to <2 years 8.8% 9.0% 7.7%
2 to <3 years 4.5% 4.9% 5.2%
3+ years 25.3% 25.3% 25.0%
• Testimony to the affordability
concerns of baby boomers, a
quarter of buyers have been in
the market for property for over
three years.
• Reflecting rapid price growth and
market competition in Australia’s
largest cities, 25% of baby boomers
have been looking to buy for over
three years
CURRENT ATTITUDES TO HOUSE PRICES
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Attitude to house
prices National Victoria NSW
Comfortable with
house prices 51.0% 51.7% 39.7%
Uncomfortable with
house prices 33.5% 32.2% 40.7%
I feel I am being
priced out/outbid by
other buyers 15.5% 16.1% 19.6%
• Baby boomers are grappling
with affordability pressures. The
majority of baby boomers do not
believe they are well off and are
concerned over the impact of
current house prices. 15.5% feel
they are being priced out of the
market by other buyers
• A sign that baby boomers in NSW
are struggling most with
affordability, their discomfort with
house prices was higher than their
VIC counterparts and the national
average. Just 39.7% are
comfortable with prices, while a
further 19.6% felt they were being
outpriced by other buyers.
“With Sydney house price growth leading the nation, it’s no surprise baby boomers in NSW are
most affected by affordability – there’s a real fear over the widening gap between cost of living and
income in retirement, and a realisation among some that funding a comfortable retirement may mean
moving to a cheaper area.”
– Petra Sprekos, General Manager, realestateVIEW.com.au
BABY BOOMERS VIEW ON YOUNG HOME BUYERS TODAY
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Despite buying property during
the late 1980s and early 1990s
when interest rates reached
17%, more than half of baby
boomers (55%) believe young
buyers today have it tougher
entering the housing market.
Baby boomers sympathise with
young buyers because they,
too, are grappling with
affordability pressures.
• Over half (56%) think they had
it easier when trying to buy their
first home.
Neutral 26%
Today's generation
have it tougher 56%
Today's generation
have it easier 18%
RETIREMENT: LIFESTYLE PREFERENCES AND CONCERNS
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HOUSING PREFERENCES FOR RETIREMENT
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• Affordability dictates downsizing
preferences and locations - 56% of
baby boomers are looking to
downsize to a smaller
house/apartment, compared with
34.4% who want to stay in the
family home.
• More Victorian baby boomers (57.7%)
are planning on downsizing than their
NSW counterparts (51.2%).
• Baby boomers also appear to value
their independence, with retirement
communities heavily out of favour.
Housing option in retirement National Victoria NSW
Downsize to a smaller apartment 56.0% 57.7% 51.2%
Stay in family/long time home 34.4% 34.4% 36.9%
Live with children (spare room,
granny flat) 3.6% 2.3% 5.7%
Retirement village/community 6.1% 5.6% 6.3%
REASONS FOR DOWNSIZING
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Reasons for downsizing National Victoria NSW
I won’t be able to physically maintain the
property 35.5% 35.7% 31.6%
I want to reduce upkeep/maintenance of my
home 56.4% 56.2% 56.1%
I can’t afford to live in my current property in
retirement 16.2% 14.8% 18.4%
I want to boost my retirement savings 22.5% 23.1% 18.4%
I want a sea change (coastal area) 21.1% 21.2% 25.9%
I want a tree change (rural area) 9.6% 9.9% 7.9%
Other 8.1% 9.1% 7.0%
The dream for the sea change
lifestyle still dominate – double
the number of baby boomers
desire a sea change over a tree
change.
• Affordability is again at play,
with one fifth of baby boomers
using downsizing as a tactic to
boost retirement savings, and
16% can’t afford to live in their
current home in retirement.
• Of those who are downsizing,
physical maintenance and
affordability were key drivers –
almost one fifth can’t afford to
stay in their current property in
retirement
DOWNSIZERS – CHOICE OF LOCATION
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Location National Victoria NSW
In the same area as long time/family
home 35.6% 40.3% 32.3%
In a different area from long
time/family home 47.6% 47.2% 51.2%
In a different state to family/long time
home 12.0% 10.1% 13.0%
In a different country to family/long
time home 2.8% 2.3% 3.5%
• Of those who are
downsizing, more will
need to live away from
their family home than
not.
• The next page outlines
motivators for why baby
boomers are moving away.
REASONS FOR MOVING TO A DIFFERENT AREA FROM FAMILY HOME
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Reason for moving to different area National Victoria NSW
I want a sea change 37.7% 36.7% 49.7%
I want a tree change 14.5% 15.2% 11.0%
More affordable property prices 30.2% 25.3% 39.4%
To be closer to family/friends 21.0% 20.1% 17.4%
Better services (public transport, shops,
healthcare) 17.1% 16.0% 12.3%
Better social activity/entertainment
(community activities, entertainment,
restaurants)
21.3% 20.4% 20.0%
Closer to the city 12.9% 14.1% 5.8%
Other 8.0% 8.2% 6.5%
• A seachange and affordability
were key motivators for baby
boomers moving to a new
area.
• Once again, baby
boomers in NSW were
most heavily impacted by
affordability, with 41%
moving to a new area due
to affordability
• The sea change lifestyle
resonates strongly with
Sydneysiders (49.7%) – it is
much higher than the national
average (37.7%).
CONCERNS ABOUT LEAVING THE FAMILY/LONG TIME HOME
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22.8
24.5
10.7
15.3
12.9
19.9
43.6
Concerned about leaving friends/family
Concerned about paying too much for a smallerproperty
Emotionally attached to the home
Concerned about being socially isolated in a newarea
Worry they won't enjoy living in a new area/home
Concerned about giving up space
Don't have any concerns
0 10 20 30 40 50
• Moving away from
family and friends and
paying too much for a
smaller property were
the leading concerns of
those worried about
moving out of the
family/long time home.
Interestingly, a
significant 43.6% of
baby boomers didn’t
have any concerns
about leaving the family
home.
FUNDING RETIREMENT
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• Contrary to the belief that baby
boomers will retire on property
wealth, the majority are heavily
reliant on their superannuation
– with many concerned this
won’t be enough.
• 37.8% believe they won’t have
enough money to fund retirement
• This concern was higher in NSW
(41.2%) but lower in VIC (33.3%)
– further proof that NSW baby
boomers are most concerned
about their financial future.
• Over one fifth (22.2%) of baby
boomers will be reliant on
government pension, compared
with just 12.1% who are self-
funded, a worrying finding given
the recent increase to the pension
age and slow jobs growth.
Source of retirement income National VIC NSW
Other 3.8% 3.3% 5.1%
Selling an investment property/properties 4.3% 4.7% 3.5%
Rental income from investment
property/properties 8.0% 9.4% 6.7%
Government pension 22.2% 17.8% 22.6%
Reverse mortgage 0.3% 0.1% 0.5%
Income from part-time/casual job 6.1% 5.3% 6.1%
Selling the family home 6.8% 7.6% 7.0%
Self-funded/personal savings 12.1% 12.4% 10.2%
Superannuation 36.3% 39.5% 38.4%
I am confident I will have adequate
funds in retirement National VIC NSW
Confident 29.1% 32.2% 29.4%
Neutral 33.1% 34.5% 29.4%
Not confident 37.8% 33.3% 41.2%
QUALITY OF LIFE AND PRIORITIES IN RETIREMENT
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How much do you need to live
comfortably in retirement? National
Less than $20,000 2.4%
$21,500-$25,000 5.8%
$26,000-$30,000 8.0%
$31,000-$35,000 8.6%
$36,000-$40,000 11.9%
$41,000-$46,000 10.2%
$47,000-$50,000 13.3%
$51,000-$55,000 10.7%
$56,000-$60,000 9.8%
$60,000+ 19.4%
Baby boomers’ hopes for the lifestyle they
wish to lead in retirement are being tempered
by concerns of making ends meet.
More than half of baby boomers said they would
need over $46,000 per annum to live comfortably
in retirement – higher than the estimated $42,254*
experts say is required in retirement.
*Estimate from the Association of Superannuation Funds of
Australia (ASFA) for a single homeowner to live comfortably.
AFSA also estimated couples need $57,817 to live
comfortably in retirement.
Priorities in retirement
1. Holidays
2. Health and fitness
3. Social outings/entertainment
4. Dining out
5. Shopping
6. Other
PLAN MELBOURNE ZONING
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PLAN MELBOURNE ZONING LEVELS OF CONCERN
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• There is widespread
concern among Victorians
about the impact of new
zoning rules under Plan
Melbourne on the areas
they want to buy in. 72%
are concerned in some
way about its impacts.
• Of these, 28% will reconsider
their choice of suburb (refer
to next page).
• However, the jury is still out –
with around a third not at all
concerned, and a further
35% unsure or not impacted
by Plan Melbourne.
18.0%
15.7%
22.0%
18.5%
31.2%
14.4%
14.4%
5.8%
Concened about the availability oftownhouses/units/villas in the areas they want
to buy in
Concerned about the impact on house prices
Concerned about the impact on liveability
Concerned about the impact on the quality ofdevelopments they want to buy in
Not concerned
Did not know about the new zoning laws
I don't know what I think yet
Will not impact me
0% 5% 10% 15% 20% 25% 30% 35%
PLAN MELBOURNE ZONING IMPACT ON CHOICE OF SUBURB
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8.0%
5.0%
15.0%
17.5%
21.0%
8.4%
24.8%
Will reconsider as don't want to be limited byproperty choice
Will reconsider as new laws will impact propertyvalues in area I want to live in
Will reconsider as I don't want to live in highdensity
Doesn't matter as long as I am close toshops/amenities/transport
Will not affect my choice as my area is notchanged by zoning laws
I did not know about new laws
I don't know how it will affect my choice
Contact details
Anna Kenneally / Mia Cochrane at Keep Left
(03) 9268 7800
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