THINGS are looking up for the retirement living sector with more vertical villages and added on-site services on the cards for Australian residents.
Baby boomers are driving the trend towards retirement living in high-rise apartments, with almost a third of all planned new retirement communities including multi-storey vertical village components.
That’s according to new data from the Property Council of Australia, with baby boomer retirees showing more of a preference for apartment living.
The annual PwC/Property Council Retirement Census for 2018 shows nearly 30 per cent of new villages currently under development are either vertical or a combination of vertical and horizontal compared to 15 per cent of existing developments.
It also found 97 per cent of new developments have at least five facilities or services available for residents, including health services, emergency call systems, social programs, cafes and community centres.
This year a record number of participants took part in the census, with contributions from 52 operators across 610 villages and over 68,000 units.
Property Council of Australia’s executive director of retirement living, Ben Myers, said the survey shows how the industry is responding to changing resident needs.
“What is interesting is the trend towards a fuller service offering that goes well beyond housing,” he said.
“Modern retirees are seeking a more holistic solution, including easy access to health services on site and a range of recreational options.”
PwC Real Estate advisory partner Tony Massaro said the results reflect an industry that is becoming more sophisticated.
“The broader range of facilities offered, an increase in vertical villages and greater variety and flexibility of fee structures reflects a determined focus on meeting the demands of the next generation of retirees,” Mr Massaro said.
Modern retirees are seeking a more holistic solution, including easy access to health services on site and a range of recreational options.
Over 2000 units a year are set to come into the market over the next four years. But Mr Myers said despite this “strong pipeline” of units coming into the market the industry is still struggling to find suitable land to supply purpose-built housing for the rapidly increasing number of older Australians.
He also said it is taking longer, on average, to re-sell units.
“The census also confirms some challenges the industry will look to address in 2019 – time on market for re-sales increasing, reflecting a broader real estate trend as the residential market cools.”
And Mr Massaro said while the market was “facing headwinds” – mirroring the residential housing market – average occupancy of villages across Australia was still strong at 89 per cent.
“Furthermore the affordability statistic which shows the median price of a two-bedroom unit as compared to the median house price for the same postcode is good news for seniors who are downsizing from homes that they own,” he added.
Other key findings
- The average two-bedroom independent living unit is 64 per cent of the median house price across Australia (44 per cent in Sydney, 55 per cent in Melbourne).
- 97 per cent of new developments have at least five services of facilities available for residents.
- 83 per cent of current villages have at least five services available to residents.
- The average age of a retirement living resident has increased to 81, while the average age of entry remains at 75.
- Only 2 per cent of current residents are now aged under 70.
- Residents live in a village for an average of 8 to 9 years.
- 62 per cent of village residents are female, 38 per cent are male.
- 61 per cent of independent living units are occupied by a single resident, 39 per cent by couples.
- Nationally, 27 per cent of villages have co-located aged care (or within 500 metres of the village).
- WA, Tasmania and ACT were noticeably above the national average and SA is below the national average.
- The average monthly service fee nationally is $564, with for profit providers appearing to charge higher service fees compared to not-for profits.
For more details, go to www.propertycouncil.com.au
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