Labor’s October 2022 Budget has introduced measures making it easier for older Australians to downsize, in a move hailed by the Retirement Living Council.
Under the scheme announced in September, downsizer contributions for superannuation will be accessible to anyone aged 55 and up – down from 60 – and home sale proceeds will be exempted from the pension assets test for 24 months, up from 12; additionally, the deeming rate on home sale proceeds used to buy new homes has been cut from 2.25% per year to 0.25% per year.
“This measure will reduce the financial impact on pensioners downsizing their homes and give them more flexibility to find suitable new homes. It will also help to free up housing for younger families,” said Services Australia.
Retirement Living Council (RLC) Executive Director Daniel Gannon (pictured) has called the move a “win-win” for both older Australians and the strained housing market.
“Removing disincentives for older Australians to downsize into age-friendly communities is a win for older homeowners, government health and aged care budgets, and for younger Australians looking for family-sized houses in established neighbourhoods.
“As taxpayers face growing health and aged care costs, older Australians ‘right-sizing’ into age-friendly communities is the right move at the right time,” he said.
The Budget also contained a slew of measures for aged care, including additional funding.
