Helping our ageing communities.
A look at the trends and opportunities for retirement and care home investment in 2024 and beyond
As healthcare standards improve and birth rates continue to fall, a higher percentage of our UK population are now aged 65 and over.
At the 2021 National Census, it was shown that 11 million people in England and Wales had met or exceeded this milestone, contributing to 18.6% of the total population, up from 16.4% the previous decade.
Whilst the power of the grey pound has had positive benefits to many areas of the UK economy, with many older people possessing disposable income and equity in property, the boom in the elderly population has also brought a rise in housing and healthcare needs to accommodate the challenges associated with ageing.
We spoke to Alex Bodie, Head of Community Housing and Healthcare at Together, to discuss some of the trends that he has seen in the retirement and care sector over the last couple of years, what trends he expects to see in the near future, and the opportunities that could be presented to the socially conscious and savvy investor and developer.
Trends for 2024 and beyond
By 2040, it is expected that the percentage of the UK population over the age of 65 will be around 25%, accelerating the increase we have already seen in this demographic over the last 10 years.
This means, as that demographic becomes older there will be an increasing need for retirement home spaces and hospice care to support and deal with greater health issues seen in older age. There will also be more individuals needing care for long term conditions such as dementia as experts expect cases to continue to increase up to 50% within the 65 and over age group in the next 25 years.
Looking back on 2023
But what about the issues currently facing the sector? Whilst we have worked with a host of socially conscious developers over the last two years, demand is already outstripping supply, with an additional 50,000 units per annum needed to meet the growth in the older demographic.
Other stresses on the retirement and hospice sector have included a rise in overall running costs, most notably around staff costs and utility price rises. This shortfall already sees unpaid caring obligations for older adults expected to exceed a value of £162 billion. To put that in to perspective, that is the equivalent to almost the full NHS budget for health service spend.
The existing infrastructure available for adult care does not service the current needs of the demographic. For example, 30% of beds lack en-suite facilities, showing the need for modernization and refurbishment of facilities within retirement and care homes, alongside development in new sites.
Cause for optimism
This backdrop represents significant opportunity to those operating in the Community Housing and Healthcare sector. The increased needs for the older demographic create numerous avenues for socially conscious developers looking to fill these requirements.
There is also a significant amount of global capital ready to be invested in the sector, especially in retirement living. This includes both retirement homes and supported living communities with the UK being the largest private market for the sector in Europe.
Working with a lender that understands Community Housing and Healthcare with a track record of working with the different parties to see the creation of care homes from the drawing board through to completion gives developers a real advantage when it comes to seizing opportunities.
We have worked alongside local authorities, commissioning bodies, architects and developers to see through a range of successful sites, helping to fund worthwhile projects throughout the UK.
If you are interested in finding out how Together can help you with your community housing projects, please see our Community Housing and Healthcare page or contact our dedicated team.