Downsizing: How agents can assist older Australians

Property leaders have called for reforms to help older Australians downsize, freeing up homes for millions of buyers, as data shows they hold most of the nation’s spare bedrooms.

Similarly, the Retirement Living Council (RLC) warned that current rules have been penalising retirees who sell to move into villages, cutting them off from key pension and rent assistance benefits.

According to Ockelander, older Australians and retirees in her area are usually either very willing to sell and downsize or unable to stand the thought of moving, preferring to stay where they are.

She said that while no one will sell their home until they are ready, agents can assist the process by informing older Australians about other options on the market that fit their criteria.

For many retirees, the decision to sell depends on whether they can find a new property that is close to family, friends or their network.

“I've got a couple in Beecroft where they've been wanting to go closer to their daughter for three years and she's in Dubbo, but it's also [a matter of] availability,” Ockelander told REB.

“People want to move close to their family, but then sometimes they don't want to move out of Sydney because they're medical doctors and all their contacts are here or their church and their network.”

Ockelander said that while it has taken the elderly couple three years to find a property in Dubbo, a house has come up next door to their daughter, and they’re in the process of purchasing the property.

In addition to keeping prospective downsizers updated about their property options, agents can educate and inform them about the advantages of selling their family home and moving into retirement villages.

“The advantage of retirement villages, they've got a network of people that they can be around and there are functions and there are trips and they can be involved or they don't need to be involved,” Ockelander said.

Additionally, educating retirees on the reality of the costs involved in moving can be beneficial when encouraging them to sell their property.

For example, Ockelander said that some may be hesitant to move to a strata property as they don't want to pay levies, but agents can inform them that the costs are less than they seem.

“I say, well, if you add up what your house insurance is, how much it costs you to do your lawn, do your garden, clean your gutters, do any repairs, each year you're paying more than what the strata levies are,” she said.

“Your building insurance is also included in the strata levies and you don't need to pay that.”

She also said that strata properties tend to offer reduced council and water rates, but retirees often don’t recognise the cost savings, instead focusing on the regular expenses.

“I do a spreadsheet and just show them the differences so they can see that really they're going to be in front if you added up everything you spent on a house in a year.”

She said that since some older Australians may not realise the cost difference and can be susceptible to misinformation from others, it’s up to agents to set the record straight.

“You need to see what their current belief system is about it and correct them if they've been thinking something different.”

Further, agents need to gain the trust of prospective downsizers by being upfront and honest with them, and not focusing on their own interests.

“A lot of agents will just push them to get a listing or tell them a price that's unrealistic to get a listing and then they don't get that money,” Ockelander said.

“So it’s just [about] being honest with people … it's just people knowing me and knowing that I'm here to help.”

Additionally, Ockelander said that many prospective downsizers will be daunted by the idea of packing up their belongings and decluttering their homes, which can cause them to put off selling their property.

She said that agents can make the process easier by offering to help them get their house ready to be put on the market.

“I help most of my clients by giving them that service and giving them the names of the people I trust to do those things for them because they don't think they're capable of doing it well.”

“They're generally not capable of doing it themselves. And so then everything gets put off because it's just too hard.”

Finally, to help with their peace of mind, agents can advise retirees to visit Centrelink and clarify what would happen to their benefits if they sold their family home.

“That money part is a big fear that, ‘Will I lose my medical benefits? Will I lose my pension?"

“So you have to be able to show them, ‘Well, yes …but you'd have enough money to buy an investment villa or unit, and then you've got income from that’."

“So you have to be able to show them both sides of that,” Ockelander concluded.

The realestate.com.au GemLife Downsizing Australia Report has revealed that 85 per cent of Australians aged 55 and older lived in homes with two or more spare bedrooms.

By comparison, a quarter of Australians aged 25–54 had no spare rooms, and five per cent had fewer rooms than their family size required.

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