New reports suggest that the number of purpose-built retirement properties is set to grow considerably by 2022 due to increasing demand with downsizing becoming a more popular option for the older generations.
Research from Knight Frank has looked into the growing sector with the hopes of gaining some insight into how the market may change over the coming years and what will need to be done to meet the demand.
In total there are currently just over 720,000 retirement properties in the UK, three-quarters of these homes are social housing, but the research found that there are roughly three million homes required to meet the demand of those who’d like to move into a retirement home.
This demand is forecasted to increase with estimations of the number of people over the age of 65 set to grow by 20% by 2027, taking it to a total of 12 million people in need of retirement properties.
Over the last two decades, the retirement market has seen some change in terms of funding, while in the past the majority of homes were funded publicly. Since the new millennium, approximately 54% of new homes built have come from private developers. This is predicted to rise to 78% within four years.
This has resulted in some experts calling on the government to introduce schemes and incentives to help those looking to downsize as it could potentially have a good impact on the entire market. With the older generations downsizing, larger family sized homes would become available for those moving up the ladder and in turn, smaller starter homes would become available for first-time buyers.
Head of Retirement Housing at Knight Frank - Tom Scaife - shares this sentiment, offering: “Going forward we rapidly need every UK local authority to have a cohesive plan for the delivery of retirement living - so they can be held to account for meeting the needs of their constituents. The government has committed to help those at the beginning of the property ladder with initiatives such as the ‘Help-to-buy’ scheme and stamp duty relief for first-time buyers. These initiatives and support should not be constrained to the beginning of the ladder - support should be available at all stages of the property life cycle.”