Calculating the real cost of retirement

AUSTRALIA’S ageing population presents a major strategic planning challenge for governments.

Industry analysts suggest a fundamental shift in thinking is required to support a larger group of aged people in our community.

Housing is one of the hottest topics as the baby boomers approach retirement.

While some retirement developments have proved popular, the supply of retirement villages has not always been in tune with demand.

BGC Construction general manager Gerry Forde claims that a lot of aged housing is poorly considered.

The Government’s policity of locating small aged developments within the community has left retirees isolated.

“The units have bars on the windows and three locks on the door and the people living inside are peeping out,” Mr Forde said.

Brightwater chief executive officer Dr Penny Flett said the sheer size of the baby boomers meant no single product would suit the entire demographic.

“I think the business world and the commercial world will work it out much more quickly than other sectors,” Dr Flett said.

Colliers International manager residential, Nicholas Wells said the absence of competition in a market did not indicate that there was an opportunity to exploit.

There is a huge range of retirement style property product on the market, from nursing homes through to independent units within country club-style developments.

“The market is pre-empting itself in thinking the baby boomers are ready to retire,” Mr Wells said.

The baby boomers are expected to delay retirement and this will delay the age at which they even consider moving into a new home or a care facility.

Some retirement village developers tell a different story, however. They maintain the security afforded by modern developments and the communal activities are a big drawcard for retirees some as young as 60.

Cameo Estates director Stephen Dean said the challenge was to target younger people to make a voluntary choice to move into developments in their late 60s.

“Then they can live in a community of like-minded people – but we don’t want the stigma of the retirement village,” Mr Dean said.

Shenton Village in Subiaco is a redevelopment on the site of the old Shenton Park Hotel.

This boutique-style development includes a cafe and wine bar, both of which are open to the public.

The 66-unit development includes a secure under-ground carpark and a 24-hour emergency call service.

“We’ve got normal services like a dining room, spa and a whole range of personal care services available as they are wanted,” Chestar manager Peter Norris said.

It’s not a small investment, however. The units are priced from $285,000 up to $445,000, so it’s a big decision for any retiree.

The major developments on the east coast of Australia are now focused on leisure activities.

Increasingly, the retiree developments are proposed as a total leisure development that is more like a private club than a retirement home.

And the residents move in to relax and enjoy life, rather than focus on their advancing years.