At almost 6 million strong, the Baby Boomer generation makes up just over 25 per cent of the Australian population, which means you should have considerable influence on the direction the country’s economy is moving in — especially when it comes to housing.
In fact, today’s 60-pluses have more than 50 per cent of the nation’s private wealth and by the time the oldest of you hit your mid-70s there will be one of the biggest intergenerational wealth transfers in history.
Chances are your home is one of your largest assets, having been purchased during a sustained boom in house prices. However, with that in mind have you ever stopped to think about how the housing market with change as you look to cash in on your real estate investments?
First and foremost, Baby Boomers are different
Let’s acknowledge that unlike other generations you are far less diverse than Gen X-ers and Millenials. You, your parents and grandparents likely lived in Australia under the White Australia policy, which was abolished in 1973, so it has only been in more recent decades that the country’s largely European population has embraced a mix of cultures.
The other thing that sets you apart is that you are staying in the labour force longer than previous generations, which is in part thanks to longer life expectancies as well as the added financial needs to accommodate those extra years.
You want to age at home
There is an increasing number of people who feel you won’t hold on to you property forever, and will want to one day sell off your properties and spend the cash on creature comforts and luxuries.
However, almost one third of Baby Boomers want to remain in their current residence, claiming to be quite satisfied with their they live. Community is a large reason for this, but so too is the fact you just really love your house.
Renovation is a consideration
Even if you are staying put, there is clear concern about how your current residence will stand up to your changing needs. Some acknowledge that renovation is a necessity if you are to stay in your home as you age.
The cost of renovations is an obvious concern.
What about renting then?
While almost 40 per cent of you own your home outright, at least one-third are still paying off a mortgage and one-fifth are happily renting. When you do decide on that ‘change of location’ the fact affordable private rentals are getting harder to find means many of you will likely buy.
Does this mean you’ll downsize?
If there is a desire to move, something smaller and more practical is not expected of Australian Baby Boomers. The Freddie Mac report found that downsizing was only ‘very important’ to about 20 per cent of Boomers and 17 per cent didn’t think it was important at all.
No, it seems that what you’re looking for is affordability. In fact, there are several facets you look for in a home:
A comfortable retirement
The biggest issue for many Baby Boomers is having confidence that retirement will be financially comfortable. Only a very few from your generation feels that secure. If you’ve been lucky enough to make gains from property and have a super and investment strategy planned in advance you should have the confidence that you’ll be comfortable in the years ahead.
But on the flipside, there are those of you have who not been able to save enough over your working life.
One thing is for sure, Baby Boomers will certainly be keeping the real estate industry on its toes.