UK must build retirement housing to reverse housing crisis, urges report

housing crisis, retirement homes,
© Thomas Gowanlock

The UK’s failure to build retirement homes prevents downsizing and the key to unlocking the housing crisis lies in reversing decades of underinvestment, says a new report

The key to unlocking the UK’s housing crisis lies in reversing decades of underinvestment in purpose-built housing for older people which could encourage downsizers and free up family homes.

The Associated Retirement Community Operators (ARCO) report, ‘Too little, Too late? Housing for an ageing population’, reveals that 15 million bedrooms are surplus to requirements across UK homes.

The report, independently authored by the Centre for the Study of Financial Innovation, expects this bedroom surplus will exceed 20 million by 2040, with nearly 13 million people above the age of 65 living in largely unsuitable households.

The report highlights:

  • The key to unlocking the UK’s housing crisis lies in tackling the under-occupation of family homes, where nearly 9 million households aged over-65 live in a house with ‘surplus’ bedrooms.
  • Only 2.5% of the UK’s 29 million dwellings are technically defined as ‘retirement housing’ – but the number of purpose-built homes offering care services is far less, at around 0.7% of UK housing stock, according to a recent report from the Urban Land Institute.
  • Just 7,000 new homes built each year are designed for older people. This is inadequate to serve the 180,000 65-plus households that will be created each year over the next decade.

The report calls on Government to:

  • Promote the benefits of downsizing and incentivise people to downsize before social care is needed, partly through cuts to Stamp Duty Land Tax.
  • Establish a housing strategy for older people that joins together housing and health, and obliges local authorities to plan for retirement housing and to identify appropriate sites.

ACRO believes this would kickstart the housing market by freeing up family homes, provide much-needed choice for older people, and enable them to lead healthier lives for longer, reducing pressure on health services.

Housing that works for everybody

Nigel Wilson, CEO of Legal & General, said: “Our housing stock needs to work for everybody. People of all ages need more supply of housing and better choices, whether they are trying to accommodate a growing family, looking to rightsize to a healthy and safe later living environment, or indeed to retrofit their existing home.

“We know there is strong demand for the right sort of housing for later life living, with great design, supportive communities and good access to friends, family and facilities.

“Housing policy now needs to catch up with the demands and opportunities of our ageing demographic: getting this right has benefits for everyone.”

Phil Bayliss, CEO of Later Living at Legal & General and chairman of Guild Living, commented: “As has become ever more apparent in the past few months, there are major failures in the way we house our elderly in their later years.

“As a country, we need to acknowledge the benefits that a new form of retirement community can bring and to actively plan to deliver these homes. For this, we will need policy support that mandates a minimum quota of homes each year to meet the needs of older people.

“These communities offer significant health benefits – a 50% decrease in GP visits and an 80 percent decrease in hospital stays – and more manageable social care costs. More than this, they provide vibrant communities that can help increase healthspan.

“This is why we established our out-of-town and urban later living operators, Inspired Villages and Guild Living. These businesses are offering a new way forward through great design, community, and care services, enabling people to live healthier, happier, safer, and more independent lives.”

Helping older people live better

Eugene Marchese, co-founder at Guild Living, which is developing purpose-built housing for older people in town centres, said: “This welcome report lays bare some stark figures on how much housing is being wasted and how far behind Britain is when it comes to providing the right amount of age-appropriate accommodation.

“This is about one thing: helping older people live better. Most people have no real understanding of “later living” – but the Covid-19 crisis has woken everyone up of what happens when we ignore the question of “how do we want our parents to live?”

Félicie Krikler, director at Assael Architecture, added: “As this report makes clear, households have been shrinking in size for four decades, but the way we design new homes has failed to keep pace.

“Our planning system must recognise that well-designed later living housing can transform our lives as we get older by allowing us to age better. This is not only by supporting mobility, but also by creating aspirational housing that people choose to move to, not because they have to, and intergenerational places with shared services that sit at the heart of their community.”

You can read the full report here.


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