The Housing Crisis: are Retirement Homes the Answer?
It’s well-known that the UK is in the midst of a housing crisis; a lack of affordable homes has led to huge cost increases, resulting in the idea of owning a home being a distant dream for some.
But what if that’s not the full picture? What if we have been focusing on first time buyers when, instead, we should have been looking at the retired ‘last time buyers’?
In the last couple of years the UK’s major housing crisis has been directly linked to our ageing population - currently only 1% of Britons live in retirement homes, compared with 17% in the US, with the main reason being that there is a chronic undersupply of appropriate retirement homes. By 2033 we are expected to see the UK population of over 60s increase from 10 million to 17 million. Surely something has to change?
Around £400bn is tied up in homes of over 60s who want to downsize. Results from a recent report found that around one million elderly people would consider living in retirement housing, with only 128,000 properties built for this purpose. This shortage looks to be having a detrimental effect on the housing market. Creating more retirement homes will benefit the elderly, release more family homes on the market and therefore alleviate some of the pressure on the housing market for people desperately trying to get on the ladder.
However, it seems the UK has one of the lowest rates of moving among the over 65s, likely due to the focus on building new homes for first-time buyers. Are the government and construction industry missing a trick by ignoring the older generation?
Building retirement appropriate housing would not only benefit those in the proverbial spring or autumn of their lives, but would also provide various benefits across society. As retirees generally want to live in built-up areas with easily accessible services, building retirement properties would use up brownfield land and, as a result, would also help to sustain business on our high streets. Furthermore, sufficiently serviced retirement properties lead to residents spending less nights in hospital and generally managing better, meaning that the state would see a reduction in spending on publicly funded residential care.
The needs of the older generation should be recognised when deciding future housing policy, with the benefits and higher living standards that the older generation can gain from living in retirement appropriate accommodation being emphasised.
The Government has launched the London Help to Buy Scheme yesterday (1st February 2016) and buyers in the capital will now benefit from an equity loan of up to 40% with a deposit from as little as 5%.
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