The hidden cost of downsizing: How your home’s sale can hit your pension

September 29, 2026 — 1:00pm

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Downsizing can free up equity to invest or spend. But for retirees receiving the age pension that can be a problem as you may be converting an exempt asset into an assessable one.

New data from over-50s developer GemLife shows that, of 1474 purchasers across 12 communities, the average equity release was $254,098 when downsizing into a land lease community.

That $254,000 can boost your savings, buy a new car, caravan or boat or help out the kids but it can also reduce your pension and other benefits.

For pensioners, the magic numbers are $333,000 if you’re single and $499,000 for couples. These are the asset test thresholds. Once your assessable assets exceed the threshold, your pension reduces by $3 a fortnight for every $1000 above the threshold.

Put simply you lose $7800 per year of pension for every........

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