It is no secret Australia’s population is ageing.
At 30 June 2020, there were an estimated 4.2 million older Australians (aged 65 and over), comprising 16 per cent of the total Australian population.
The number of older Australians has increased from one million (8.3 per cent of the total population) in 1970 and 2.1 million (12 per cent) in 1995.
By 2066, it is projected that older people in Australia will make up between 21 per cent and 23 per cent of the total population.
So it might not be a surprise retirement villages are increasing in popularity.
Based on the 2021 PwC/Property Council Retirement Census sample set, the development supply pipeline planned by participating operators doubled from the 2020 Retirement Census from just over 5,500 to over 10,500 over the next three-year forecast period.
Supply in New South Wales is expected to be particularly strong through FY23 and FY24.
The metropolitan areas of Sydney, Melbourne and Brisbane have indicated the greatest concentration of supply of units to the market.
And more projects have been announced since.
Recently, Stockland Halcyon, a group specialising in lifestyle communities for individuals over 50, announced it is set to embark on a significant expansion in Victoria.
With four projects slated for launch within the next year, Victoria will serve as the vanguard for Stockland Halcyon’s national growth.
Presently, Stockland Halcyon boasts a total of 12 communities across various locations in Queensland, encompassing the Sunshine Coast, Gold Coast, Moreton Bay, Logan, and now Victoria.
The two new Stockland Halcyon communities will provide around 530 new homes between them with Stockland Halcyon Evergreen (295 homes) enjoying the natural bush surrounds within the Stockland Evergreen masterplanned community, while Stockland Halcyon Horizon (234 homes) is designed with beachside living in mind.
The two other Stockland Halcyon communities in Victoria which are expected to launch to market in FY24, include Highlands (Craigieburn, in Melbourne’s north) and Stockland Halcyon Jardin1 (Clyde North, in Melbourne’s southeast).
In other states, Stockland is progressing The Gables (Hills District, Sydney) – the first Stockland Halcyon for NSW – Redland (Brisbane’s southern bayside) and Providence (south of Ipswich, Queensland). Sites are also being scouted in Western Australia.
Richard Rhydderch, Executive General Manager Stockland Halcyon Communities said he has seen demand grow.
“We’ve had a really encouraging start in Victoria and we’re excited to move into this sector at pace,” Mr Rhydderch said.
“We’ve been able to look at the lessons from South East Queensland to create a compelling value proposition for the Victorian market.
“Many of the Stockland Halcyon communities delivered five to ten years ago were about safety, security, and affordability, but the market has changed.
“The level of home finishes and facilities buyers want is now 1 Formerly St Germain. Those over 50, particularly baby boomers who can afford it, are demanding a lifestyle that they have earned,” he said.
Mr Rhydderch said the baby boomer generation is demanding a better quality of retirement than what their parents had.
“We’ve strong sales across all our over 50s land lease projects, and 83 per cent for FY24 are unconditionally exchanged,” he said.
“This also reflects the strong equity positions of these customers, and lower reliance on the traditional drivers of the broader residential market, including mortgage rates.
“In addition, the land lease model offers a strong customer value proposition for those looking to downsize, underpinned by relative affordability and the simplicity of the land lease product.”
The land lease model, spearheaded by companies like Halcyon, as well as publicly listed competitors such as Ingenia Communities and Lifestyle Communities, specifically caters to baby boomer homeowners. This model involves the sale of their family homes, followed by the purchase of smaller houses situated on leased land within a community.
Ingenia Communities has expansion on the mind, with 6,451 potential development sites across 32 projects in the works spread across Victoria, Queensland and New South Wales.
Mirvac has also noted a desire to increase its exposure to land lease communities going forward.
Another player in the land lease scene, Lifestyle Communities, has launched four of seven projects planned for FY23, bringing the total number under development to eight. The company said it will have eleven projects in various stages of delivery by the end of FY23.
There are currently legislative reform agendas in Victoria, Western Australia, Queensland and South Australia on the sector.
Retirement Living Council Executive Director Daniel Gannon, in a recent opinion piece the retirement living industry offers a trifecta of opportunity – superior housing outcomes for senior Australians, more housing supply, while delivering significant efficiencies for State, Territory and Federal Governments.
“Investment conditions relating to the retirement living industry can be strengthened or eroded by legislative frameworks around the country,” he said.
“Capital goes where it’s welcome, and we’d like to think that parliamentary decision-makers appreciate the delicate nature of the relationship between investment and regulation.”