The Sydney Morning Herald has been gently fanning a few embers of intergenerational discontent. The thrust of the report was that the reluctance of older owner-occupiers to downsize from their detached residences, replete with spacious backyards, was impacting the quality of life of younger families. The latter would either they’d have to scrunch into inner suburb townhouses and apartments, or head out to the sticks.
A fair observation. But there’s little incentive for 50+ to make the move when they’ll be punished several ways for doing so.
First, there’s the stamp duty on a new place, along with all the other changeover costs. Then there’s knowing the surplus from the sale of the family home will become counted in net assets (your own home is excluded), perhaps reducing pension entitlements. There’s the emotional upheaval of such a move and the life laundry it requires. The option to accommodate children who may be struggling for somewhere to live themselves may be gone. And not least is the apprehension of moving from the relative tranquillity of a solid detached home to a smaller and possibly less soundly-built place where the potentially noisy neighbours are literally on top of you. All in all, a not a great deal.
So why would they do it? Out of a sense of obligation? Unlikely. They won’t do it until the government gives sufficient incentive for it to happen, perhaps changing lump sum stamp duty to annual land tax. This is a problem that has been looming for decades and failure of the government to forecast property demand will cut little ice with 50+. After all, they’ve worked hard to get here, and they may have another 30 years of living to plan for.
http://www.smh.com.au/federal-politics/political-news/housing-crisis-report-says-backyards-for-children-vanishing-as-oldies-stay-put-20151028-gkl3eh.html