{"id":619335,"date":"2026-04-20T14:37:16","date_gmt":"2026-04-20T14:37:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/619335\/"},"modified":"2026-04-20T14:37:16","modified_gmt":"2026-04-20T14:37:16","slug":"expensive-homes-and-mega-mortgages-risk-blowing-up-retirement-system","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/619335\/","title":{"rendered":"Expensive homes and mega-mortgages risk blowing up retirement system"},"content":{"rendered":"<p>Australia\u2019s retirement system has been based on the presumption that the overwhelming majority of people would own their homes outright upon retirement.<\/p>\n<p>However, due to declining homeownership rates, Australians buying homes later, and carrying larger mortgages into retirement, that assumption is clearly crumbling.<\/p>\n<p>Westpac <a href=\"https:\/\/www.afr.com\/property\/residential\/more-people-will-retire-with-housing-debt-and-that-s-a-problem-20260330-p5zjsl\" rel=\"nofollow noopener\" target=\"_blank\">notes<\/a> that people over the age of 40 accounted for around 20% of mortgage loans issued to first-home buyers in 2025.<\/p>\n<p>As a result of people purchasing later and taking out larger mortgages, Loan Market Group has found that 40% of respondents do not expect to have paid off their mortgages\u00a0by the time they retire.<\/p>\n<p>Advertisement<\/p>\n<p>This analysis aligns with <a href=\"https:\/\/www.afr.com\/policy\/tax-and-super\/most-australians-run-out-of-super-by-the-end-of-their-lives-study-20240220-p5f6bb\" rel=\"nofollow noopener\" target=\"_blank\">warnings<\/a> from the Super\u00a0Members Council of Australia, which estimated that more than 40% of Australians will retire with mortgage debt, up from 16% two decades ago.<\/p>\n<p>To exacerbate the situation, 40% of individuals and 33% of couples will utilise their entire superannuation savings to pay off their debts.<\/p>\n<p>Credit bureau Equifax also suggested that the number of enquiries from Australians aged 55+ about refinancing their mortgage rose by 12% year-on-year in February, while enquiries from the 46-55 age group grew by 8%.<\/p>\n<p>Advertisement<\/p>\n<p>Then there is the problem of surging rents, which have jumped by around 48% since the end of 2019, far outpacing wages and superannuation growth.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/04\/Australian-advertised-rents.png\" width=\"660\" height=\"396\" alt=\"Advertised rents\"\/><\/p>\n<p>Cotality estimates that the median tenant household today needs to spend around $11,700 more annually to rent the median advertised home than they did at the end of 2019.<\/p>\n<p>Advertisement<\/p>\n<p>As a result, <a href=\"https:\/\/www.abc.net.au\/news\/2025-12-09\/renters-need-twice-more-super-than-home-owners-in-retirement\/106104784\" rel=\"nofollow noopener\" target=\"_blank\">research<\/a> by Super Consumers Australia has found that the typical single renter retiree needs $659,000 in superannuation to enjoy a financially secure future, more than twice the $322,000 required by a homeowner.<\/p>\n<p>Couples face a similar gap: $786,000 for renters versus $432,000 for homeowners.<\/p>\n<p>Renters are three times more likely to struggle financially in retirement. Only 10% of retired homeowners are in financial stress. By comparison, nearly 50% of retired renters face financial stress.<\/p>\n<p>Advertisement<\/p>\n<p>The above data suggest that Australia\u2019s housing crisis poses a direct threat to the nation\u2019s retirement system.<\/p>\n<p>A growing proportion of Australian retirees will rent in the future, while others will shoulder larger mortgage debts.<\/p>\n<p>Both situations will reduce the amount of disposable income available in retirement.<\/p>\n<p>Advertisement<\/p>\n","protected":false},"excerpt":{"rendered":"Australia\u2019s retirement system has been based on the presumption that the overwhelming majority of people would own their&hellip;\n","protected":false},"author":2,"featured_media":619336,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[64,63,99],"class_list":{"0":"post-619335","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-au","9":"tag-australia","10":"tag-business"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/619335","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=619335"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/619335\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/619336"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=619335"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=619335"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=619335"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}