Older home owners can use their property to financially support their retirement rather than downsizing, according to a recent survey.
Despite Australians over 60 possessing more than $3 trillion in home equity, reverse mortgages are used to access only 1 per cent of that equity, according to Deloitte’s 2026 Australian Reverse Mortgage Survey.
The professional services firm found that the strategy was severely underutilised and could unlock an additional $600 billion in equity if utilised to its full potential, with 8,000 households taking out a new reverse mortgage in the 12 months up to June 2025.
You’re out of free articles for this month
The introduction of the reverse mortgage provided home owners with an alternative to downsizing, allowing them to remain in their current home while using its value to support their lifestyle in retirement.
A reverse mortgage allows home owners to take out a loan against the value of their property, based on the borrower’s age, and does not require regular repayments.
Instead, the loan balance accrues interest until it is voluntarily repaid, such as when the property is sold or when the last surviving home owner passes away.
Deloitte Australia partner James Hickey said that while products such as reverse mortgages could be used to keep older Australians in their home through retirement, their use has remained low
“It is clear that an established market already exists for Australians to use equity release products like a reverse mortgage to access the equity in their homes without needing to sell their home,” Hickey said.
“However, current low uptake indicates many don’t know about the product or understand how it may help them meet their financial goals.”
He said that, with low use, aging households were not using all the resources available to them to support their lifestyle.
“While downsizing is a common way to access home equity, retirees who wish to stay in their homes can consider reverse mortgages or other equity release options as alternatives,” Hickey said.
For those who used the products, the data showed that the average amount of equity accessed was around $150,000.
It ranged from $125,000 for those 65 or younger to $220,000 for older borrowers, with the most common uses being home improvements or debt repayments.
The survey found that approximately 80 per cent of reverse mortgage repayments were voluntary, with only 20 per cent triggered by mandatory requirements.
Loading form…
“The high rate of voluntary repayments of around 10 per cent per annum demonstrates that borrowers are proactively managing their loans, rather than simply leaving the balance to compound,” Hickey said.
Heartland Australia Bank chief commercial officer Medina Cicak said the data showed that those who utilised reverse mortgages were very selective in their use.
“Older Australians are not drawing more than required; on average, they access around 50 per cent or less of their available equity,” Cicak said.
“This indicates a considered and prudent approach to how the product is used, allowing customers to maintain flexibility and ensure their future needs are met.”
