Struggling post divorce? A new home loan scheme aims to help older single women

A new home loan scheme is set to help the growing number of older, single women finance a new house after separation or divorce — with the goal of curbing Australia’s worsening homelessness problem.

Older women are the fastest-growing group of homeless people in Australia in recent years, with an estimated 405,000 women aged 45 years and over at risk of homelessness (made up of 165,000 women aged 45 to 55 years, and a whopping 240,000 women aged over 55).

The women at risk are often described as “invisible” as the majority have had conventional housing and work histories throughout their life. Often staying at home raising children for long periods, many women end up retiring with next to no superannuation, perpetuating financial struggles later in life — particularly after divorce. Experts say the pathway to homelessness is a gendered issue and a “consequence of long-term systemic issues” that the government needs to address.

While the government has done little so far, property developer Ingenia Communities has announced it will be backing a new home-loan scheme for older women to help bridge the financing gap they need after a divorce or separation to buy a home in one of the company’s communities.

Ingenia is providing $3 million towards the first-ever solution for prospective residents through Land Lease Home Loans. Ingenia has also committed additional money to help Land Lease Home Loans subsequently expand as a provider of finance to clients of other land lease companies.

Founded in January this year by former ANZ Health director Andrew Ralph, Land Lease Home Loans is a fintech start-up solely focused on providing residents of land lease communities with similar financing opportunities to those available to a traditional house-and-land homeowner.

Land Lease Home Loans supports the view recently expressed in the government’s Retirement Income Review report that “owning a home has a positive influence on a person’s standard of living in retirement”, and that “accessing equity in the home can significantly boost retirement incomes without the need for additional contributions”. The new scheme will help older women with the purchase of a home and allow the option of drawing on some of the equity to boost their income.

Ralph said he was excited to work with Ingenia in establishing the first dedicated provider of home loans for land lease residents and had been pleased with the level of consumer and sector interest and activity already. “This is an untapped area of housing finance demand and we believe the potential market is significant,” he said. “There’s already a strong pipeline of inquiries ahead of the official market launch.”

Simon Owen, Ingenia Communities CEO, said he was pleased to see a finance solution made available to residents of land lease communities. “We have seen the tremendous success of this market in the US, where the provision of funding is commonplace, and have been very keen to support the introduction of a well-thought-out and well-executed finance solution for prospective residents who may require a modest loan to facilitate their move to a community,” he said. “This funding solution is a natural next step in the growth and maturity of the land lease sector in Australia.”

Kate Melrose, Ingenia Lifestyle general manager project sales, said they’ve already seen interest in the scheme, which she says will give people greater choice and greater access to affordable housing options layer in life. “With an increasing volume of downsize buyers still working, and the trend for Baby Boomers wanting to take control and downsize earlier, Land Lease Home Loans will provide greater choice and control to more downsizers wishing to control the right time to move and increase access to affordable housing options for more people seeking security in later life.”

At the end of the 2020 calendar year, Ingenia had 40 land lease properties, totalling 4,327 homes.

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