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In Building Boardroom’s latest market overview, Josephine Smit looks at the later living sector, which in the UK is starting from a small base but has enormous growth potential, especially with a recent rush of investor interest
Before covid-19 hit, later living was being tipped as a growth sector for UK property and construction. Eighteen months of pandemic, with its challenges for many care homes and their operators, has done little to diminish interest in a market that spans retirement living, housing-with-care communities, and residential or care homes.
Almost 12 million people in the UK are aged 65 and over, and by 2036 this age group is expected to make up one in four of the population. But with fewer than 750,000 later living homes in 25,000 developments across the UK and that number increasing by less than 7,000 new homes a year, according to research by property consultant Knight Frank, there remains a yawning gap between market potential and supply.
“The sector is still quite embryonic,” acknowledges John Tonkiss, CEO of the UK’s leading retirement housebuilder, McCarthy Stone. “In countries like the US, this type of housing offer is far more familiar and there are sizable businesses making good returns. In the UK, retirement housing has traditionally been thought of as a housing offering, rather than as a real estate and service offering, but I think that’s shifting.”
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