Determining the drivers of supply of retirement communities in Australia

Publication Type:
Conference Proceeding
8th State of Australian Cities National Conference, 2018, pp. 1 - 13
Issue Date:
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Housing supply theory has established a number of influences on the quantity and price of housing. These include construction cost, house prices, interest rates, land prices, demographics and government policies. A subset of the housing market comprises retirement communities, which (in Australia) are restricted to those who meet age and disability requirements. This property type comprises real estate plus a business component; as a result the developer of the property is usually the ongoing operator of the business. This research evaluates whether the supply of retirement community accommodation conforms to established housing supply theory. It is based on the study area of Port Macquarie Hastings which is a noted retiree destination with a range of retirement communities developed over the last four decades.Using this extant supply of retirement communities this research establishes that the main driver behind the decision to commence development has been the perception of unmet demand. In more recent years the additional driver of relatively affordable land has been identified. These are not major drivers of housing supply; it appears that the supply of retirement communities responds to different drivers. Other factors are noted within this study area namely that supply continues despite market saturation exceeding state and national benchmarks. It appears that particular regions can support a greater quantity of retirement community accommodation and that increasing supply attracts residents from outside that region. This suggests that housing retirement communities face a different market structure, this is of relevance to policymakers seeking to stimulate supply of this property type.
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