Baby-boom or bust? Finally, the answers!
Our daily dealings with property investors and ongoing research for our newsletter and webinars has unearthed an interesting train of thought, which appears to be held by many.
It goes along these lines:
What might happen when baby boomers [people born between 1945 and 1964] retire and sell up their real estate en-mass? Will the value of properties plummet? Will there be a glut of large properties for sale at once? Will this be an opportunity for first home buyers to get their foot in the door [so to speak]??
When Baby Boomers retire, there won’t be one single red letter day, week or even month when they all decide to sell their properties. When they retire, they’ll still be active, capable of looking after their properties and not ready for a retirement village/ nursing home. Most will be happy to enjoy their early retirement in their own home.
Those who do sell up will want to downsize to smaller premises. Think high-rise units, strata units with smaller gardens. Much of these properties are yet to be built. This means that property developers and investors will not have much trouble finding a property to purchase and develop. Ageing properties, on large land, sold by baby boomers will be demolished to build duplexes and apartments. It’s this development that will help house the growing population.
With approximately 5.3 million Aussie Baby boomers due to reach retirement age during the next 15 years, there’s a lot of activity to come.
To avoid a baby-boomer bust, Australia’s population will have to keep getting bigger. In fact, the Australian Bureau of Statistics estimates our population will grow by around 60% to 35–40 million people by 2050.
This new wave of young people should fill the jobs left by the Baby Boomers as well as take on all the new jobs created by our growing economy. They’ll pay tax, buy or rent new homes and spend money helping the economy.
This population growth will bring with it significant social, infrastructure requirements – which will also help create jobs. So more people, more property available by retiring baby boomers, there should not be an oversupply of property, resulting in a dramatic fall in property prices.
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Property Friends is a specialist Property Investment Strategist that provides solutions for people aspiring to financial independence, choices in retirement, or leaving a legacy. www.propertyfriends.com.au (03) 9758 5331