From Renting to Owning: How Life Estates Can Help Australian Seniors Achieve Home Ownership

As an Australian retiree caught in the rental cycle and no longer earning a salary, achieving home ownership may seem like a distant dream. But what if you could own a home for life, without the burden of full ownership costs? Life Estates offer a unique solution, making home ownership more accessible and affordable.

How Life Estates Work

A Life Estate allows you to own a property for life, while an investor contributes to the purchase price. Only after you pass away does the ownership of the property pass to the investor. This shared ownership model reduces the upfront costs, making it more affordable for retirees who are stuck renting to achieve home ownership.

Benefits of Life Estates for Seniors

• Affordability: A significant reduction in the cost to purchase. This reduction is typically around 50% but can be higher or lower depending on circumstances.
• Security: Life estates are formally registered with the land titles office in your state providing secure and registered ownership of the property for life.
• Peace of Mind: Rest easy knowing you own the roof over your own head and a landlord cannot evict you or put up the rent.
• Maximising Pensions: The purchase can be structured to reduce your financial assets and improve pension eligibility as your home is exempted from the assets test that is used to determine your pension.
• Flexibility: Any home is eligible, and if you no longer wish to live in it, you can rent it out and use the income to live elsewhere.
• Ownership Costs: There are no fees, ground rents or other on-going costs applicable. Please note, normal home ownership costs such as council rates, utilities and insurance are still applicable.
• Estate Management: There are no complex settlement arrangements or debts that have to be settled by your estate, we’ve designed them to be as simple as possible.

How Life Estates Can Help Address Affordable Housing Challenges

• Increasing Housing Affordability: By sharing ownership costs, home ownership can be made far more achievable for Australian retirees.
• Addressing Housing Shortages: Life Estates can help increase the availability of affordable housing options; any home can become an affordable home via Life Estate.
• Immediately Available: Unlike government schemes Life Estate’s are an entirely private market solution to this problem with no waitlists or capped availability. We will partner you with an investor and ensure you are able to access an affordable home quickly.

How Life Estates Can Drive Better Outcomes In Retirement

• Breaking the Rental Cycle: Renting in retirement has been found to be a key driver of poverty.
  • Vanguard research indicates that nearly 1 in 5 retired Australians are renting in 2024.
  • Grattan Institute report that in 2024 nearly half of retirees who rent are living in poverty and that falling home ownership rates will make this worse.
  • Anglicare Australia’s 2024 Rental Affordability Snapshot reported that only 0.2% of rental listings nationally were “affordable” for a single person living on the aged pension.

Taken together, these data points indicate that in 2024, approximately 10% of Australian retirees are renting in poverty with no affordable options available to them. Life Estate’s change this.

• Reducing Living Expenses: By no longer needing to make weekly rental payments your single biggest living expense is dramatically reduced, freeing up money to be spent on everything else.
• Providing Certainty and Security: Renting leaves many retirees suffering other significant non financial stresses, such as stress of eviction or the stress of not knowing how much their rent might rise by.

Is a Life Estate Right for You?

If you’re a retiree looking for an affordable housing solution, a Life Estate may be the answer. The unique shared ownership model provides affordability, security, flexibility, and the ability to improve your pension payments whilst letting you live anywhere. Before committing to any major financial decision we recommend discussing your retirement goals with your family and/or licensed professionals so that you can make the right decisions to achieve them.