Australian housing demand is getting a kick along from older divorcees, who are parting ways at a faster rate than ever before and putting themselves back into the market.
While the country’s overall divorce rate slipped to 1.9 per cent last year, continuing a trend that has seen it fall from 2.9 per cent in 1996, breakups among older couples rose to their highest ever level in 2016, having nearly doubled over the past 35 years, official figures on Tuesday showed.
The trend sits squarely on the shoulders of the baby boomer generation born between 1946 and 1964. After all, more of them are married. While divorce rates have stabilised in the past 15 years among the 45-to-49 cohort and fallen in the younger age groups – possibly because fewer people are getting married at those ages – divorce has increased among women and men in the older groups and that is boosting demand for housing.
‘‘Divorces involving long-term marriages have been increasing over time,’’ said Lixia Qu, a demographer with the Australian Institute of Family Studies.
‘‘Couples in mid-to-late life will build up some assets and when they divorce, they need to downsize. It’s easier for them to enter in the market than younger couples.’’
Older divorcees are also more likely to boost the demand for smaller dwellings as the chance of children being involved in the breakup is lower. The proportion of divorces involving children dropped from nearly 54 per cent in 1996 to just under 47 per cent last year.
However, demand for smaller dwellings is probably being masked by the growing number of adult children living at home and inflating household size. Separate Census 2016 figures showed the proportion of 25-to-34-year olds still living at home jumped over the past five years from 11 per cent to 11.6 per cent.
While adult children staying at home will hide the growing demand for smaller dwellings coming from older divorcees but not stop it, said Brian Haratsis, the founder of consultancy MacroPlan Dimasi.
‘‘What we are seeing is a trend towards higher household sizes in the short term but this demand has only been commuted, not stopped, and in the longer term we are likely to see much smaller household sizes and demand for a different kind of dwelling – most likely smaller, cheaper and near enough to amenity or transport to limit the need for a motor vehicle – in the future,’’ Mr Haratsis said.
Terry Rawnsley, principal of consultancy SGS Economics & Planning agreed.
‘‘In the past generally what happened was people, men retired at 65 and died before they hit 70,’’he said. ‘‘But now there’s a whole lot of people who might retire at 55 and who, spending more time with their partner, realise that it’s time to part ways. They’ve now got 30 years of life where they’re going back into the housing market looking for smaller dwellings or differently located dwellings.’’
Many older divorcees were also adding to housing demand by not retiring to the coast or the country as previous generations, but by wanting to stay in the suburbs or city, Mr Rawnsley said.
‘‘People are selling their houses in middle suburbs and moving to where the action is,’’ he said. ‘‘An older divorcee has a similar desire to go where the action is.’’
An older divorcee has a similar desire to go where the action is.
Terry Rawnsley, SGS
