Renting in Retirement: What Support Is Available with the Pension?
Australia’s rental crisis is no longer just a concern for young families and students. Increasingly, it’s retirees who are feeling the pinch. With the number of older renters steadily rising and aged pensions often failing to keep pace with housing costs, many seniors are facing an uncertain future.
The Rise of Renting in Retirement
Home ownership has traditionally been seen as a cornerstone of financial security in retirement. But in 2025, more Australians over 65 are entering retirement without owning a home. According to the Australian Bureau of Statistics, over 530,000 people aged 65+ now rent privately — a 32% increase over the last decade.
Factors driving this trend include housing unaffordability, divorce later in life, and a lifetime of insecure or low-paid work. For many, the Age Pension is their only source of income — and it’s not enough to meet rising rental costs.
“We never thought we’d be renting at 72,” says Gloria Banks from outer Melbourne. “But we sold our home to pay medical bills, and now the pension just doesn’t stretch far enough.”
Understanding the Age Pension
The Age Pension is a fortnightly payment available to Australians over retirement age (currently 67), subject to income and asset tests. As of 2025:
- Single maximum rate: $1,116.30 per fortnight
- Couples (combined): $1,682.80 per fortnight
- Rent Assistance: Up to $184.80 per fortnight (single), depending on rent paid
While these figures may look adequate on paper, housing costs in cities like Sydney and Brisbane continue to outpace pension increases. Many seniors report spending over 50% of their pension on rent — well above the 30% threshold used to define housing stress.
What Is Rent Assistance?
Rent Assistance is a supplemental payment added to the Age Pension for eligible recipients renting privately. However, eligibility depends on:
- Paying more than the minimum rent threshold
- Renting privately — not in public or community housing
- Being under the asset/income test limits
Critics argue that Rent Assistance hasn't kept pace with market rents. The Australian Council of Social Service (ACOSS) reports that the average gap between assistance and actual rent is now over $120 per week.
The Housing Affordability Crisis
In Australia’s major cities, vacancy rates remain below 1%, and rents have increased by over 20% in some regions over the last 18 months. This disproportionately impacts older renters, especially:
- Single women over 55, now the fastest-growing group at risk of homelessness
- Aboriginal and Torres Strait Islander seniors, many of whom face compounded economic and health challenges
- Those on fixed incomes, including Disability Support Pensioners transitioning to retirement
In regional centres like Ballarat and Newcastle, rental increases once considered city-specific are now becoming widespread.
Support Beyond Rent Assistance
While Rent Assistance is helpful, it’s not the only support available:
- Commonwealth Rent Subsidies through community housing providers
- State-based housing waiting lists — though these can be years long
- Seniors Housing Grants for modifying or downsizing homes (where ownership exists)
- Legal support and tenant advocacy through organisations like Tenants' Union NSW and Seniors Rights Victoria
“Older renters need more than just money — they need security,” says Rachel Bent from the National Shelter network. “That means stable leases, respectful landlords, and stronger tenant protections.”
Innovative Solutions on the Horizon
Some states are trialling new approaches to meet demand:
- Co-housing models for seniors in South Australia
- Modular homes and micro-villages for older women at risk in Victoria
- Rental subsidy pilots in WA for pensioners transitioning out of social housing waitlists
Private sector solutions are also emerging. Property developers are working with aged care organisations to offer long-term rental villages with capped increases and on-site support.
The Call for Reform
Advocacy groups are pushing for broader reforms:
- Indexing Rent Assistance to real-time market data
- Incentives for landlords who offer long-term leases to pensioners
- Expanding access to public housing for people over 60
- Establishing a national housing strategy for ageing Australians
A Senate inquiry in 2024 recommended immediate increases to Rent Assistance and a mandatory rental affordability standard for age pensioners — but implementation remains pending.
Advice for Retirees Renting Now
For those navigating retirement as renters in 2025, experts recommend:
- Applying early for public or community housing
- Using Centrelink financial information service (FIS) to maximise entitlements
- Connecting with seniors’ tenancy advocacy groups
- Considering regional moves — but weighing access to healthcare and social connections
“Knowledge is your biggest asset,” says Helen Forsyth, a retirement housing advisor. “Start planning early — don’t wait until crisis hits.”
Conclusion: A Future That’s Affordable and Fair?
As Australia’s population ages, the question of housing in retirement becomes more urgent. For hundreds of thousands of pensioners, renting is not a choice — it’s the only option. Without targeted policy support, advocacy, and innovation, too many may find themselves aging into poverty.
For now, the Age Pension and Rent Assistance are lifelines — but without broader reforms, they risk being life rafts in a rising tide.