Unlocking Home Equity: The Growing Role of Reverse Mortgages in Australia

By Gian Ottavio, Lead Broker, Sydney

As Australia’s population ages and property values continue to rise, reverse mortgages are becoming an increasingly relevant financial tool – particularly for retirees who are “asset rich but cash poor.”

These specialised reverse mortgage loans allow homeowners aged 60 and over to tap into the equity in their homes without needing to sell or make regular repayments, offering a way to supplement income in retirement while remaining in the home.

Aging Population, Rising Property Values – A Financial Opportunity

Australia’s demographic makeup is shifting rapidly. As of mid-2024, 4.4 million Australians are aged 65 and over – a figure that is projected to reach over 6.6 million by 2041 (ABS, 2024 Population Projections). At the same time, housing wealth is climbing – the total value of Australian residential property reached $10.9 trillion as of June 2024 (ABS 6416.0).

This intersection of more retirees sitting on more housing wealth makes reverse mortgages a powerful tool for converting long-held equity into usable cash flow.

Solving the ‘Asset Rich, Cash Poor’ Challenge

Many older Australians find themselves owning valuable homes but struggling to cover day-to-day expenses. Here’s how reverse mortgages offer a flexible solution:

• Borrowers can access funds via lump sum, regular payments, or a line of credit
• No repayments are required until the borrower sells, moves into care, or passes away
• The borrower retains full ownership of the home throughout

Used strategically, reverse mortgage loans can cover aged care costs, home modifications, or simply provide income to enjoy retirement with dignity and security.

It’s Not One-Size-Fits-All: The Role of Financial Planners for Reverse Mortgages

While reverse mortgages can provide real value, they’re not suitable for everyone.

Factors such as future care needs, estate planning, eligibility for Age Pension, and the long-term effect on wealth should all be considered. That’s where working with an experienced financial planner is essential.

At Brooks & Partners, we offer integrated mortgage brokering and financial planning under one umbrella – ensuring every reverse mortgage is assessed within the full context of your broader financial plan. This collaborative approach helps ensure the product is not only suitable, but strategically structured to support your long-term lifestyle goals and protect your estate.

A reverse mortgage should never be viewed as just another loan – it’s a strategic decision that affects your wealth, your legacy, and your lifestyle.

Our In-House View: Gian Ottavio, Lead Broker

We’re seeing a noticeable shift – more retirees and even financial planners are open to reverse mortgages as part of a holistic wealth strategy. With property values at all-time highs and people living longer, it’s a conversation worth having. That said, it’s not about just unlocking equity – it’s about doing so responsibly. That’s where our combined broking and advisory model really adds value: we’re not just placing loans, we’re designing retirement solutions.

Is a Reverse Mortgage Right for You? Key Considerations

If you’re considering a reverse mortgage on your home, here are a few important points to explore:

• Eligibility: Generally for homeowners aged 60+
• Loan Amount: Based on your age and home value
• Interest Accrual: Interest compounds over time (no regular repayments)
• Centrelink Impact: May affect Age Pension or other entitlements
• Estate Planning: Will reduce the value of your estate unless repaid early

What Could You Unlock From Your Home with a Reverse Mortgage?

Whether you’re looking to improve your retirement income, fund in-home care, or simply explore your options, understanding how much equity you may be able to access via a reverse mortgage is the first step.

At Brooks & Partners, we offer no-obligation consultations to help you:

• Estimate the equity available in your home
• Understand how a reverse mortgage may fit within your broader financial goals
• Receive tailored advice through our integrated broker & adviser team

Contact us today to schedule a personalised equity assessment and start the conversation about how your home could support your next chapter.