One of the most significant trends in the Australian property market is the ageing profile of property owners.
This will have major implications for property investors, PMs and developers over the coming years as it will shape the type of properties most in demand from property buyers.
In particular, the ageing profile of property owners has already led a big increase in the number of people seeking to downsize to apartments.
The demand for apartment living in Australia will remain strong for the foreseeable future due to the ageing of our population.
In the past decade, the number of people in Australia aged 60 and over jumped by 1.2 million people or 35 per cent to 4.8 million people.
People aged 60 years and over currently account for around 20 per cent of our entire population or one in four people in Australia.
This ageing of our population has seen a growing demand for apartment living in established areas of major capital cities as Baby Boomers want to live in unit developments that are close to their current residences.
Property investors have been capitalising on this trend in greater numbers in recent years, especially in Sydney, Melbourne and Brisbane.
The generous tax depreciation benefits associated with buying a new apartment has also been encouraging more investors to purchase apartments.
While there are many issues concerning the depreciation entitlements on properties, in most cases, strata-style homes such as new apartments provide a higher rate of depreciation than houses, all being equal.
Paul Bennion is the managing director of DEPPRO tax depreciation specialists. DEPPRO is Australia’s leading property depreciation company, specialising solely in the preparation of tax depreciation reports for residential, commercial, industrial and leisure investment properties.