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Baby boomers are buying and upgrading property to get around pension rules, according to one research group.
IBISWorld said boomers, who are currently aged between 50 and 68, were exploiting the fact that residential homes were not counted in pension asset tests.
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“Currently, a retiree investing all of their superannuation into housing can access the pension, while another retiree opting to rent will have to live off their superannuation,” according to IBISWorld.
“This is encouraging those who do not own houses to purchase property and those that already do to upgrade to more expensive properties to stay under the asset limit.”
IBISWorld said this would drive activity in the property market as boomers upgraded their homes or relocated to be closer to the city, coast or country.
Boomers comprise 22 per cent of the population and have high disposable incomes due to their years of hard work and smart property investments, IBISWorld said.
“Housing ownership in Australia is higher among baby boomers than in any other demographic, and the rapid growth in property prices over the past 20 years has turned their homes into huge assets,” IBISWorld said.
“Home ownership among the over-65s is around 82.8 per cent compared with 67.5 per cent across all households.”
