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Insidious issue stopping older Aussies like Jo from retiring: 'Have to work until we physically can't'

Jo said retirement isn't even an option for her and her husband as they're worried they'll have to keep working until they physically can't.

Young Australians have been vocal about how difficult the housing crisis has made it to rent. But it's not just the youth struggling with skyrocketing rent and dwindling vacancies.

Jo Hilder is in her 50s and she's laid bare how dire the rental crisis is for some older Australians. The mother-of-four is terrified for her future and told Yahoo Finance the amount of rent she and her husband are paying is a big reason they have no idea when they will be able to retire.

"The stress is incredible...retirement is just not even an option," she said.

Jo next to a bunch of Aussie houses
Jo said the stress and pressure of renting in your 50s at the moment is intense. (Source: Supplied/Getty)

Are you affected by the rental crisis? Email stew.perrie@yahooinc.com

Jo and her partner bought their first home in their 20s on Australia's east coast, but they didn't want to be plunging all their money into their mortgage while they were raising their four kids.

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They wanted to give their kids a well-rounded childhood, so they decided to sell the house, travel and enjoy the world while everyone was still young.

Jo thought they had plenty of time to build up their retirement nest egg and planned to buy their next property in her late 20s.

But, after a devastating cancer diagnosis in her early 30s, Jo's life was turned upside down and she had to prioritise her health over settling down.

Fast-forward to now, the 55-year-old and her partner are renting in Maitland in New South Wales. She said they are just making ends meet.

They moved to the area to be closer to her husband's work, and even though it's away from a capital city, the rent is still really high.

"We got here and we had to basically start paying rent that was equal to a whole week's wages...that was just the market," she said.

Jo said she understands and sympathises with the plight of young Aussies trying to afford rent and other life expenses. But unlike the young, older Australians don't have decades up their sleeves to save for retirement or a house deposit.

"I think probably more than ever, it's become a very stressful factor in our relationship as the pressure is on for me to keep working," she told Yahoo Finance. "And the pressure is on him to keep supporting us to cover all of our expenses basically, as the cost of living rises.

"It's pretty upsetting to know that we will probably have to work until we can't work anymore physically."

She's working in retail at the moment but she's worried she only has a few years left before it becomes too difficult.

Her stress was only compounded when she discovered how much it costs to get into a retirement village.

The average entry fee for getting a two-bedroom unit at a retirement village in Australia is around $463,000.

Chris Grice, National Seniors Australia Chief Executive Officer, told Yahoo Finance Jo's story is sadly not uncommon due to the high cost of living.

“Housing security and affordability is a huge concern for many older Australians, with an increasing number of older people unable to afford their own home and relying on the precarious and competitive rental market," he said.

He revealed there are more than 165,000 people aged between 55-64 who are receiving rent assistance from the government.

"Yet, rent assistance is not keeping up with rental increases," Grice explained. "This is why National Seniors Australia is calling for an increase to the maximum rate of Commonwealth Rent Assistance and to tie indexation to changes in rental prices rather than overall CPI.

Treasurer Jim Chalmers revealed this week in the 2024 Federal Budget the government would increase Commonwealth Rent Assistance by 10 per cent at a cost of $1.9 billion over the next five years. The measure is expected to help nearly one million households.

But Anglicare Australia’s recent Rental Affordability Snapshot found that out of nearly 46,000 rental listings in the country, just 0.4 per cent were affordable for someone on the Age Pension while only 1.1 per cent were affordable for a couple. Those are record lows in the Snapshot's 14-year history.

“Older people have been left behind by the rental market," Anglicare Australia Executive Director Kasy Chambers said in a statement.

“We know why this is happening, and we know how to fix it. Every year, Australia’s social housing shortfall gets worse and worse. We have a shortfall of almost 640,000 social homes. Many older people depend on these homes for security as they get older.

“Without action, older people will simply be left to the mercy of the market.”

Data released from Domain earlier this year revealed units had experienced a record-breaking 11th consecutive quarterly increase.

Aussies were paying a median price of $620 per week for an apartment in an Australian capital city. Sydney was unsurprisingly the most expensive place to rent a unit at $700 per week, while Adelaide and Hobart were the cheapest at $460 a week.

But renters might be spared from more price hikes later this year.

Domain Chief of Research and Economics, Dr Nicola Powell, told Yahoo Finance it appears many cities have reached their peak.

"When you look at views per listing, it looks at the number of potential renters per listing, that's been declining. And that's pretty entrenched in the market now.

"So it means that the peak is past. And what we're seeing is consistently annually, we're seeing fewer views per rental listing. That might be an early indicator that we'll eventually see that vacancy rate track higher."

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