How You Could Benefit From the Recent Changes to the Downsizer Superannuation Contribution Legislation
You may have heard about the recent approved amendments by the Australian Senate to the downsizer superannuation contribution legislation, but what does this mean? We speak with Johanna Keating, Vice President of Sales and Marketing at Hometown Australia to discuss how some downsizers could potentially benefit.
What’s the long and short of it?
Johanna Keating: In 2018 the Australian Government introduced the scheme with the aim to assist in reducing the pressure of housing affordability within the country. This means, if you are aged 65 years or older and are looking to downsize you would be able to use some of the equity that has built up in the value of your home over time by selling your home and contributing part of your home proceeds to boost your superannuation.
The good news is that from 1 July 2022, the age of eligible Australians who could take part in the scheme is reduced to 60 years or older.
What does this mean for those 60 years or older?
JK The changes mean that people could potentially retire earlier. In a recent Downsizing.com.au article they reported the changes could allow people to retire up to ten years early and invest from their home sale to their retirement funds.
Is there a cap on how much I can contribute to my Super?
JK The Australia Taxation Office states eligible persons may be able to contribute to their superannuation of up to $300,000 per person ($600,000 per couple) from the proceeds of selling their home.
Is there eligibility criteria that needs to be met?
JK Yes, it is important that you understand the downsizer superannuation scheme and meet the eligibility criteria. A helpful resource can be found on the Australian Taxation Office website here.
What are the benefits of downsizing to a lifestyle community?
JK Hometown Australia have 53 communities across New South Wales, Victoria, Queensland, and South Australia appealing to coastal, urban, and rural lifestyles. Many of Hometown Australia’s lifestyle communities are in enviable locations making it possible for those to downsize to places such as Port Stephens, the Fleurieu Peninsula, and Hunter Valley, without the hefty price tag.
Residents can enjoy an independent lifestyle without the stress of ongoing home maintenance, whilst enjoying the amenities on offer across the communities. For those living on their own becoming part of a secure community provides the opportunity to meet like-minded people from a similar cohort who share the same mindset.
Do I need to be retired to live in a lifestyle community?
JK Many residents across Hometown Australia’s Communities are either working full time, part time, retired, or somewhere in between! Living in a lifestyle community is a great way to transition into retirement living or enjoy your retirement at its fullest.
What are the options for homes in lifestyle communities?
JK The decision to downsize from your family home can be an overwhelming experience and an emotional journey. It is important to think about what it is you would like in your new home and how this forms part of your new lifestyle.
Hometown Australia offer both new and pre-loved homes, with options to suit your needs and budget. New homes are thoughtfully designed for over 50s to enjoy the ease of everyday living without compromising on quality or space. Those looking to downsize are met with design options that offer large areas for entertaining guests, all whilst being part of a secure community.
What are the financial benefits of living in a lifestyle community?
JK Hometown Australia’s Lifestyle Communities can also be referred to as Land Lease Living communities and so, it is important to understand what the Land Lease Living model is and how it works. So how does it work? Land Lease Living means residents own the home and have a long-term lease over the land on which it stands. With both resort and boutique style lifestyle communities on offer it is easy to see the true value for money with residents enjoying quality homes, an array of amenities, and being part of a secure community.
There are many financial benefits of Land Lease Living including:
• No stamp duty payable
• No council rates
• No deferred management fees that can be part of moving into, or out of, a retirement village
• You may be eligible to claim Commonwealth Rental Assistance
• You also retain 100% of your capital gains as a cash profit when you sell your home. In many retirement living options, your agreement may force you to share your capital gains with the retirement village management. Living in a Hometown Australia Land Lease Living community means that more money stays in your pocket.
Visit the website for more information and discover what life could look like living in a Hometown Australia Lifestyle Community.
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