The Retirement Living Council (RLC) has released a report suggesting significant housing opportunities could arise from federal policy changes aimed at encouraging retirees to downsize.
According to the report, titled “Removing Rightsizing Roadblocks: Homes for all Australians,” two key federal reforms could free up nearly 14,000 homes in Sydney, offering crucial relief in a strained housing market.
The latest CoreLogic data highlighted the gravity of the housing situation, noting that as of early 2025, the median house price in Sydney had reached $1,193,228, reflecting an increasingly unaffordable market for new buyers and young families.
Daniel Gannon (pictured), RLC executive director, outlined the federal reforms, which include adjusting the Age Pension asset test to allow single homeowners to possess assets up to $550,000 (up from $314,000) before impacting their pension. For couples, the threshold would also see a similar increase.
Additionally, the proposal calls for the removal of the purchase price cap for retirement village entries that currently blocks pensioner access to Commonwealth Rent Assistance (CRA), setting the stage for more equitable treatment across different types of senior housing.
The proposed changes are expected to have broad and beneficial impacts:
Gannon emphasised the disconnect between the rapid increase in house prices over the past decades and the slower pace of pension asset threshold adjustments. This disparity has often deterred seniors from downsizing due to financial concerns, leading to inefficient use of large family homes.
As the federal election approaches, RLC is urging both major parties to consider these reforms seriously, highlighting the potential to improve housing availability and quality of life for both elderly citizens and young families.
This advocacy highlights the role of strategic policy adjustments in addressing broader social challenges like housing affordability and aged care.
