Scaling up the downsizing industry
How we house and treat our retirees in Australia says a lot about how we value the senior members of our community and our society, says Stockland’s CEO of Retirement Living, Stephen Bull.
Pointing to independent modelling and research by Grant Thornton, Bull (pictured) says retirees living in socially-inclusive, healthy and well-connected retirement villages tend to enter aged care five years later than the average age of ’empty nesters’ living an arguably more isolated life in their family home.
“With the annual cost of approximately $51,000 for a bed in an aged care facility, this equates to savings of $260,000 for every person, not to mention the fact that retirees can age more comfortably and with a better quality of life, at home,” he explains.
Retirement living should be a critical part of the thinking behind a more holistic approach to our future cities, Bull says.
“Generally, most Australians want to downsize within their own community. The great prediction of en mass ‘sea change’ or ‘tree change’ in retirement is largely a myth; most people want to live within 10km of their current home, close to family and friends and their favourite restaurants, shops, clubs and service providers, such as doctors.”
According to the Retirement Living Council, Australia’s current population of 3.2 million over 65s is projected to reach 8.1 million by 20. By 2025, the demand for retirement living accommodation is forecast to double from current demand, but “that demand won’t be met by existing facilities, or proposed facilities under construction, and not in the locations that retirees want to live,” Bull adds.
“Based on current rates, where approximately six per cent of seniors over 65 years of age are choosing to downsize to a retirement village, we, as an industry, would need to build 100,000 new homes in retirement villages across Australia over the next 20 years.”
However, the scarcity of land and challenges of acquiring sites in appropriate locations means the industry is building just a fraction of that. Stockland, as one of the largest developers, is currently able to build around 300 homes per year, due to the challenges of acquiring or redeveloping appropriate sites.
Bull says we are facing a critical shortage of retirement living facilities in major centres like Melbourne, Sydney, Brisbane and Perth.
“The shortage of facilities means that residents who grow up in a neighbourhood and have deep roots in that community may not be able to live in that neighbourhood if they wished to once they downsize.”
Unlike aged care facilities, there is no specific, over-arching zoning category for retirement living centres, yet they have very special requirements for residents – such as in-house medical facilities and accessible design. Bull says there are some zoning considerations for retirement living in some local government areas, however, general planning regimes are, in many states, vastly insufficient.
“Developers are therefore priced out of the market for potential new sites, particularly in suburbs within 20-30km of the city centre, because they are competing with large-scale apartment and villa developers who focus on maximising the space for dwellings only, compared with retirement living developers, who are focused on access and mobility, which increases the average unit size (reducing yield), and must also create communal and in-house medical facilities, all of which increase comparative construction costs.”
The problem is exacerbated by individual state approval processes for new retirement living sites, Bull explains. He gives the example of the Department of Fair Trading in New South Wales, which is “naturally focussed on consumer protection, an important function, however it is, of course, outside the remit of Fair Trading to focus on broader planning and housing issues”.
Stockland is calling for special zoning for retirement living facilities that recognise their unique requirements, just as zoning concessions are granted to aged care. It is calling for state governments across Australia to prioritise their respective planning controls to support a more productive pipeline of new homes within retirement living villages to meet the growing needs of Australia’s ageing population.
“The very best retirement communities are socially-inclusive, healthy and connected. And when we, as an industry and as a society, get it right the benefits are clear for all to see and experience, most importantly for retirees themselves,” Bull concludes.
Stockland is the principal sponsor of the Retirement Living Summit in Melbourne from 28-29 November. Tickets are still available.