Boomers are enjoying their retirement – unless they’re renting

Two of every three renting retirees live below the poverty line, and the problem will worsen as future generations age into retirement without owning their own home, according to a new report.

While Baby Boomers have largely reached retirement age and are still the richest generation, a key financial trait separates poor retirees from those living out their twilight years comfortably.

It’s a gap set to worsen as Generation X and Millennials head towards retirement age amid an ongoing national housing crisis.

A report from the Grattan Institute has found that while most retirees report feeling financially comfortable – three-quarters of retirees own their own home – those renting report alarming rates of financial stress. Half of retirees renting in the private market have less than $25,000 in savings, and two in three live in poverty.

The report, released on Monday, comes as polls indicate a tight upcoming election as both major parties try to prove they have policy solutions to address the nation’s housing crisis.

On top of a pledge to build 1.2 million homes by mid-2029, Labor has promised a $10,000 sweetener to attract more workers to the construction industry, and Treasurer Jim Chalmers has said pre-fabricated homes could help the government reach its target.

Voters, meanwhile, have strongly backed a Coalition plan to stop foreign investors buying residential property.

Grattan housing and economic security program director Brendan Coates said the retirement outlook was likely to be worse for Gen X and younger generations as home ownership continued to plunge among poorer Australians.

“Today’s low-income renters are tomorrow’s renting retirees,” he says. “And whereas a third of retirees who rent today live in social housing, where rents are capped at 30 per cent of income, far fewer can expect to do so in future because there simply isn’t enough social housing.”