Wednesday, October 26, 2011

Boomer Housing Stats Australia

Grey cloud gathers over housing market
Despite representing only 25 per cent of Australia's population and 38 per cent of households, the baby boomers collectively hold 49 per cent of Australia's housing assets.
The baby boomers collectively own 46 per cent of owner-occupied housing assets, 7 per cent of which is made up of housing debt. In comparison, the baby boomers hold 57 per cent of "other" dwellings, 14 per cent of which comprises housing debt.
In fact, a recent survey of people aged over 60 found that 22 per cent are "very likely" and a further 10 per cent "likely" to sell their homes and buy a smaller property to fund their retirements. By contrast, there was very little support for the third and fourth options above, selling and renting or taking out a reverse mortgage.
According to Australian Taxation Office (ATO) data, 78 per cent of property investors are lower-to-middle income earners (i.e. they earn less than $80,000 a year) and three-quarters of these investors are negatively geared - i.e. losing money and investing purely for capital gain.
There is, therefore, the risk that the baby boomers will soon switch from net buyers to net sellers of investment properties due to the low yields on offer (about 3 per cent after costs) and, in the case of boomers who are negatively geared, the inability to claim tax deductions against other income once they cease working.

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