Baby boomers could be on their way out of major cities

With baby boomers on the verge of retirement age, national research company Propertyology’s managing director Simon Pressley expects a surge in buyers seeking affordable homes in regional areas over the next 15 years, including in Ballarat.

Ballarat, Bendigo, Geelong, Shepparton and Mildura are the only Victorian centres listed as potential seachange locations for the baby boomer generation.

Baby boomers, or those born between 1946 and 1964, make up more than 20 per cent of the population and tens, and “maybe hundreds” of thousands, could leave the capitals as superannuation fails to sustain them into retirement, Mr Pressley said.

The locations on his list had a combination of good health care, lifestyle drivers and freestanding houses priced under $400,000 and have a “pseudo-capital city” feel, with all the essential infrastructure of a major city.

The $400,000 figure is based on a couple of retirement age on a $100,000-plus household income who want more than a $32,000 annual pension.

Assuming they are in a four-bedroom family home on a quarter-acre block, worth Australia’s average median house price of about $600,000, downsizers could sell and access $200,000 worth of equity on top of a property purchase in these towns, he said.

Investors looking to buy in regional areas needed to ensure they were major towns, rather than micro towns with a population of less than 1000, PropertyBuyer managing director Rich Harvey said.

“[Regional towns] are more affordable and offer higher yields so can be attractive to investors, but they need to do their research and make sure there’s infrastructure and development happening,” he said.

He had his doubts baby boomers were keen on regional areas, but said if they did decide to move, it was likely they would look for towns “within striking distance” of their home city.