REIV's interactive maps show where downsizers could unlock hundreds of thousands of dollars

Retirees could unlock hundreds of thousands of dollars by downsizing within their own neighbourhoods, according to research published by the Real Estate Institute of Victoria.

The REIV has published interactive maps which reveal how much money retirees could return to their bank accounts by moving to a smaller home in the same area.

According to their data, moving from a three-bedroom house in Brighton East into a nearby two-bedroom unit would unlock $453,750.

In Mornington, moving from a three-bedroom unit to a two-bedroom unit would unlock $232,500. In Beaumaris, moving from a four-bedroom house to a three-bedroom house would unlock $290,000.

The study found the suburbs with the greatest downsize potential were those in the inner to middle Melbourne suburbs such as Kew and Ivanhoe as well as those along the bay such as in Sandringham and Beaumaris. It found those suburbs have a high share of retirement-aged, lone-person households as well as relatively higher house prices.

By downsizing from a four-bedroom home to a three-bedroom home, residents would unlock, on average, $145,000. Beaumaris was the top in this category, followed by Parkdale, Northcote, Caulfield South and Williamstown.

Those downsizing from a three-bedroom house to a two-bedroom unit stand to unlock $220,000 on average. Top suburbs for this were Malvern East, Essendon, Williamstown, Ivanhoe and Brighton East.

Those downsizing from a three-bedroom unit to a two-bedroom unit stand to unlock $159,000 on average with the top suburbs being Malvern East, Mornington, Kew and Bentleigh.

REIV CEO Enzo Raimondo said that through downsizing retirees could increase their incomes and remain in the same area they had been living.

“Retirees can take advantage of the 25 or 30 years spent paying off their home loan by downsizing. This research will give them the tools to weigh up the options.

“By downsizing not only do they unlock the wealth generated over 25 or 30 years but they can also access a simpler lifestyle.”

He says downsizing isn’t for everyone, but those that do can access funds to help boost their retirement income.