Retirees who own a rural or regional property have the opportunity now to significantly benefit from the government run Pension Loans Scheme (PLS) due to an increase in real estate prices, a pension-phase service provider has said.
“The recent surge in regional property growth benefits those already living there, particularly seniors. Research shows seniors are less willing to downsize and move to a new area due to the dislocation it creates and emotional upheaval that results from moving away from friends, networks and the communities they are familiar with,” Pension Boost founder Paul Rogan said.
“With the PLS, seniors can boost their income in retirement by releasing some of the equity they have in their home (or other property) by up to 150 per cent of the full age pension rate.”
Apart from the inherent benefits associated with the PLS, Rogan pointed out it is one of the few equity release avenues retirees who own a rural or regional property can take given it operates across the nation and suffers none of the restrictions commercial service providers like Pension Boost face.
To this end, commercial providers of reverse mortgages and other equity release offerings are legally unable to lend in regional or rural areas or for non-standard forms of housing, such as farms.
Real estate prices in rural areas such as Ballina in New South Wales, Benalla in Victoria, Gympie in Queensland and Broome in Western Australia have recently risen in value by over 20 per cent, making the PLS potentially more attractive.
Seniors need to have reached the age to qualify for the age pension, meet the age pension residency requirements and legally possess the title to any real estate in Australia to be eligible to take advantage of the PLS.
Further, self-funded retirees can be eligible for the scheme regardless of whether they receive the age pension.