25 Nov Baby Boomers upsize as well as downsize – Gavin Hulcombe
The latest Herron Todd White ‘Month In Review’ report has revealed the true size of the downsizer market and it is huge. Gavin Hulcombe gives us the highlights of the report.
Kevin: It was interesting to note, in the latest month in review report that’s been produced, it is an excellent document by Herron Todd White. Joining me to talk about it, Gavin Hulcombe, who is the Managing Director.
Kevin: Gavin, it was interesting to see the theme in there being downsizing, given that it’s such a massive market that’s coming through I just wanted to focus a little bit on that if I may. Hello and welcome to the show.
Gavin: Good morning, Kevin. Thank you.
Kevin: Let’s talk about the boomer market. How big is it? How old are they on average now? What does it mean to the market going forward, do you think?
Gavin: I think it’s quite interesting for a number of years what we’ve heard is people talking about the baby boomer market and the downsizer. It’s sort of been talked about in the market, and a lot developers have sort of been looking to cater for it. But I think we’re actually now really starting to reach that tipping point where it is having quite a significant impact on the market. A lot of the retirees, the baby boomers, average age is sort of early 60s now. So they are sort of really looking at where they want to live for the years to come. They are moving out of the old family home, starting to move into more modern units and townhouses, I guess.
Kevin: Well I guess that was the focus for the government too, wasn’t it? To make a lot of the underutilised property more available to first home buyers in the hopes that it may actually make property a bit more affordable. I don’t know that it will actually achieve that, but it certainly has given the impetus for a lot more baby boomers to downsize.
Gavin: Yeah, look it has that cascading effect that if the baby boomers move out of their family homes, other families can move into those homes. That cascades right down through to the first home buyer market in the more affordable areas. What is interesting is where the baby boomers are going. They fit into a couple of different categories; you can certainly have those that are less price-sensitive and are very particular about the sort of projects that they want to live in. Very fussy over design, quality of finish, location, those sort of things. Then we’ve got those sort of still seeking a more affordable option with a few to sort of cashing in the family home and having additional spending money.
Kevin: I notice in the report too, and we’ll just step through some of the cap cities, in Sydney more prestige downsizers looking for plush apartments. They’re available in Darling Harbour and Double Bay as well.
Gavin: They are. It’s difficult to generalise. But certainly a lot of the retirees aren’t particularly price point sensitive. They really do want to be in the good locations and are prepared to spend substantial sums of money for their retirement homes.
Kevin: Tell me about intergenerational housing. What is that? Is it a growing trend?
Gavin: We are seeing that in some areas, where people are building homes that are accommodating potentially parents and/or children and their families might move into the same property. It’s about designing homes which are still functional and practical but still give the option for multiple generations to live in the one property.
Kevin: I notice in Melbourne in the report too you say that there’s some high-end architectural accommodation being build for retirees in some of the suburbs, but interestingly enough in the suburbs in which they currently live.
Gavin: Look I think for a lot of years we heard about the tree-change or the sea-change. I think that certainly fits a demographic, but I think we’ve also seen some of those people that have moved away and realised that they’re just too far away from family and are coming back to the suburbs which they’ve grown … Their families have grown up in. That’s obviously a big driver for retirees, is being around the grandkids and the family. Hence they don’t want to move too far away because they want to be on call for the babysitting duty.
Kevin: By contrast in Queensland where the lifestyle or the climate’s probably a lot better there, they’re happy to go for bayside or even inner city. I think you call them “hip replacement hipsters”?
Gavin: In some of those areas they’re certainly competing with the younger generation for the better quality locations. Even some of the retirement villages that are being built in those areas is testimony to the fact that people want to share those trendy cafes and restaurants with the younger generation. Definitely proving popular.
Kevin: Generally on the property market around Australia we continue to marvel at what’s happening in Tasmania. It’s interesting to note there that the boomers are upsizing because they’ve picked up a bit of equity.
Gavin: Look, certainly the Tasmanian market has been relatively strong, particularly in the likes of Hobart. What we are seeing is that people are moving down there to often get a bigger home, better outlook, better views. Particularly if they’re relocating from I guess Sydney and Melbourne primarily, which are definitely the more expensive homes. As they cash in those, it gives them the option to buy much bigger properties in Tasmania, which is a much more affordable market.
Kevin: Well it’s a great report, and multi-pages I think it’s about 60 or 70-odd pages. It’s available as a download, and we thank Herron Todd White for making that available, and more particularly to Gavin Hulcombe. Gavin, thanks for your time.
Gavin: Not a problem, thanks Kevin.