New data from Knight Frank shows that currently around 715,000 homes in the UK are classified as ‘retirement housing’, ranging from age-restricted developments to close care housing.
This accounts for around 2.6% of total housing stock and is dominated largely by older stock in the affordable housing sector. Private retirement housing accounts for just 0.6% of all dwellings in the UK. Around 5,500 new retirement housing units are expected to complete in the UK this year, representing around 3% of the total number of homes to be built. Overall, around 7.8 million people, or around 18% of the UK’s population, are over the age of 65.
Emma Cleugh, head of institutional consultancy at Knight Frank, said that while not all older people would choose to move from their existing homes as they age, a significant proportion would like to move into purpose-built accommodation.
According to Knight Frank, around 25% of over-55s – or around two million people – would consider moving into retirement housing in the future, a pool of potential demand that is driving interest in the sector.
“There is significant appetite in the market to develop and invest in the retirement housing sector,” Cleugh says. “We anticipate significantly increased levels of activity across the sector. However it remains to be seen whether the scale of investment will begin to re-balance the current mismatch between supply and the pool of demand in this market.”
She adds: “While much attention is quite rightly paid to the housing shortage for first-time buyers trying to climb onto the property ladder there is a less headline-grabbing trend which is just as notable in the market: the shortage of homes for older people.”
Cleugh adds that increasing the supply of purpose-built retirement housing would also loosen constraints on the rest of the housing market, making more family homes available, allowing more people to move up and down the housing ladder.