Seniors slam home sell-up call
A PEAK body for older home owners has rejected a proposal for them to use the equity held in their family home, or sell their home, to help fund their retirement.
Outlined in a Productivity Commission research paper, the proposal labelled the family home an "untapped source of income".
"Most older Australian home owners on low incomes could achieve a modest retirement living standard over the remainder of their lives by drawing on their home equity," the paper said.
In response, the Combined Pensioners and Superannuants Association urged the commission to "finally let go of its obsession" with the family home of older Australians.
The association's research and advocacy manager, Amelia Christie, said the exemption of the family home from means testing for the age pension was "not based on some irrational fear".
"Pensioners want that exemption because the family home is the only certainty they have in retirement," she said.
Ms Christie noted previous reports had shown the exemption could distort the property market, but said older Australians wanted the certainty of a roof over their head "without being forced to sell".
"Family homes lock up a lot of equity, but this is the result of Australia's laissez-faire, free-market approach to housing," she said.
"Australia's lack of a housing policy allows too much capital to be allocated to non-productive assets, in the form of housing, and changing this should be the policy priority, not making older Australians feel insecure in the housing they have spent a lifetime paying off."
The report also found it was in the government's fiscal interest to provide more home care packages for the elderly as it cost less than residential aged care and was what most older Australians wanted.
It also showed about 15% of older Australians were renters and this group was "highly vulnerable and economically disadvantaged".