{"id":2390,"date":"2023-05-31T09:46:59","date_gmt":"2023-05-31T09:46:59","guid":{"rendered":"https:\/\/kangaroovalley.nsw.au\/valleyvoice\/?p=2390"},"modified":"2023-05-31T09:46:59","modified_gmt":"2023-05-31T09:46:59","slug":"older-aussies-wary-of-revamped-downsizer-scheme","status":"publish","type":"post","link":"https:\/\/kangaroovalley.nsw.au\/valleyvoice\/2023\/05\/31\/older-aussies-wary-of-revamped-downsizer-scheme\/","title":{"rendered":"Older Aussies wary of revamped downsizer scheme"},"content":{"rendered":"

The government wants older Australian homeowners to downsize.<\/span><\/p>\n

Officials of the previous and current Labor governments have talked about housing affordability, housing availability and older Australians living in homes that are too big. Anyone feeling guilty about those empty spare bedrooms?<\/span><\/p>\n

And the incentives to move from \u2018too-big\u2019 homes into something smaller, and more appropriate, have come thick and fast. The \u2018problem\u2019 is that many older Australians are happy where they are or see more cons than pros in moving.<\/span><\/p>\n

In the YourLifeChoices\u2019 <\/span>2022 Older Australians Insights Survey<\/span><\/i>, which had almost 6,200 respondents, 72<\/span>\uff05<\/span> said they owned their home outright and another 12<\/span>\uff05<\/span> said they were homeowners with a mortgage. When asked if they were considering downsizing, 56<\/span>\uff05<\/span> said no and 20<\/span>\uff05<\/span> yes.<\/span><\/p>\n

Asked, \u201cDo the government\u2019s latest incentives make you more likely to downsize?\u201d, 70<\/span>\uff05<\/span> said no.<\/span><\/p>\n

So what are the latest incentives?<\/b><\/p>\n

When the downsizer contribution scheme was first introduced on 1 July 2018, only those aged 65+ were eligible. That was reduced to 60 on 1 July 2022 and to 55 on 1 January 2023. \u201cMore Aussies please apply\u201d seems to be the message.<\/span><\/p>\n

The scheme allows <\/span>eligible<\/span><\/a> people to make a one-off post-tax contribution to their superannuation of up to $300,000 per person from the proceeds of selling their home. Both members of a couple can contribute, and contributions do not count towards non-concessional contribution caps.<\/span><\/p>\n

But wait, there\u2019s more.<\/span><\/p>\n

From 1 January 2023, the government also extended the exemption of home sale proceeds from the Age Pension assets test from 12 months to 24 months.<\/span><\/p>\n

This gives downsizers more time to buy, build, rebuild, repair or renovate a new principal home before the sale proceeds are included in the assets test for the pension.<\/span><\/p>\n

Also, the deeming rate on principal home sale proceeds (intended for the purchase of a new home) was lowered from 2.25<\/span>\uff05<\/span> per year to 0.25<\/span>\uff05<\/span> per year. The income test now also uses the lower deeming rate of 0.25<\/span>\uff05<\/span> to calculate deemed income generated from the proceeds of a principal home sale for 24 months after the sale.<\/span><\/p>\n

What are your concerns?<\/b><\/p>\n

More than 49,000 people have made downsizer contributions, and the total put into super has passed $12 billion, with the majority of contributors being women, writes <\/span>Age<\/span><\/i> columnist <\/span>Rachel Lane<\/span><\/a>.<\/span><\/p>\n

But YourLifeChoices members appear generally unenthusiastic. Asked for their concerns in the 2022 <\/span>Insights<\/span><\/i> Survey<\/span><\/i>, the following responses were repeated time and time again:<\/span><\/p>\n