The number of Australians taking property debt into their retirement years has risen significantly, new research reveals.
According to data by ING Direct, the number of over 65 year olds still holding a mortgage increased by 28 per cent in the past three years.
Of those who still have a mortgage in their retirement years, 74 per cent are owner-occupiers, while 26 per cent hold an investor loan.
The research found that the average debt these older Australians are taking into their retirement years is $158,000.
ING Direct head of third party distribution Mark Woolnough said the research shows the rising need for Australians to plan ahead more effectively.
“As property prices climb and people wait longer to get onto the property ladder, it’s not a surprise that people are holding their home loan debt later in life,” Mr Woolnough said.
“However, proper planning is critical to make sure that this debt doesn’t cause stress in later years and people can enjoy the retirement they have worked hard for.”
The research comes after ING Direct’s Autumn Buyers Guide found that since June 2012, the average capital city residential property price has increased by 32 per cent, with growth of 7.6 per cent in the past 12 months alone.
Meanwhile, the average age of a home buyer has also risen to 38 in recent years, according to the bank.
Mr Woolnough said it’s important mortgage brokers continue to assist borrowers in making suitable financial decisions so they’re well-placed for the long-term.
“We talk about superannuation and property as the barbells of a person’s financial life cycle. In most cases, they are the two biggest investments that a person will ever make,” he said.
“Research has shown that people are very open to discussing broader financial needs when they are sourcing a mortgage, such as their superannuation, and brokers are in a great position to encourage and support their clients to consider and sort their super in light of this growing property debt trend.”
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