Older Australians who own their own home are choosing to stay in those homes despite government incentives to downsize, the latest report says.

And many of those who move out do so for health reasons rather than downsizing.

Undertaken by researchers from the University of Sydney for the Australian Housing and Urban Research Institute, the research used quantitative data from multiple sources to analyse housing trends amongst older Australians.

It found that of those who owned their own home in 2001 and who were aged between 65 and 74 at the time, 65 percent were still living in that residence fifteen years later in 2016.

For those home-owners aged 75 or older in 2001, more than half remained in their original residence as at 2016.

Amongst those who do move, moreover, few are downsizing.

Only around twenty percent of older Australians who were less than 75 and owned their own home in 2001 and who had moved between 2001 and 2016 had downsized by buying another, less expensive, owner occupied dwelling. (A further ten percent of Australians who were older but were less than 75 and owned their own homes in 2001 and had moved between 2001 and 2016 had downsized to a rental property – a figure which increased to 20 percent amongst those aged over 75 in 2001).

Instead, many who move out do so for life circumstance reasons, such as ill health or the death of a partner.

Whereas less than three percent of Aussies aged between 75 and 80 were in a nursing home in 2016, that number increased to 12.2 percent for those over 80.

Barriers to downsizing included concerns around affordability and physical health, the report said.

The report underscores challenges for policy makers in helping older Australians to adjust their housing arrangements to suit their needs as they age.

Whilst many older Aussies prefer to age within their existing property and community, for others downsizing to smaller and/or cheaper properties presents opportunities to unlock equity to finance retirement consumption and to relocate into dwellings which are easier to maintain, may have greater accessibility features and may be closer to services.

Downsizing may also free up supply of larger homes for younger families.

The report also highlights a discrepancy between older Aussies who own their own home and those who rent.

Of older Australians living in private rented accommodation in 2001, less than half were in the same home fifteen years later.

Given that many renters have their tenancy ended by eviction rather than choice, the relatively high rate of relocation among older renters as opposed to their home-owner counterparts may signal that many older Aussies who rent are being denied opportunities to age within their existing community and to enjoy security of tenure as they age.

Sources for the report data include the Survey of Income and Housing (SIH), the Household, Income and Labour Dynamics in Australia (HILDA) Survey, and the Australian Census Longitudinal Dataset (ACLD).