Retiring baby boomers likely to push up demand for apartments: John McGrath

The first group of baby boomers has turned 65 and as many prepare for retirement by downsizing they will to push up demand for apartments, says John McGrath.

He quotes Australian Bureau of Statistics figures showing there were 249,800 people aged 65 on June 30 2012 – an increase of 37,500 compared to 12 months earlier.

 A baby boomer is a person who was worn during the post-World War 2 "baby boom" period between 1946 and 1964.

McGrath, chief executive of McGrath Real Estate Agents, writes in a blog for Switzer.com.au retirees will generally want to downsize their living arrangements and many will look to buy an apartment.

Apartments are appealing because they’re smaller, they don’t have any gardens to maintain and they’re usually located around shopping, dinner and entertainment precincts, he says.

McGrath says that those downsizing in Sydney are moving to suburbs that are close to the action, such as Pyrmont in the inner city and Kirribilli across the water.

Retirees are also likely to seek apartments due to the security factor.

McGrath says they will want a place they can lock up and leave if they want to travel for a while.

Those that don't choose to live close to the city, may consider lifestyle options such as the Blue Mountains and Bowral, which offer close commuter access.

McGrath says downsizers are also relocating to Port Macquarie, however apartments are scarce in regional areas so these buyers are looking for character cottages.

McGrath says he expects to see a resurgence in the prestige apartment market once the global economic outlook improves, but until then, many downsizers will be looking at more modest apartments and townhouses for the next phase of their lives.

“Investors should take note of these trends, older Australians are set to become a major force in our property market in the years to come,” McGrath says.