Knight Frank predicts investment boom will see 44,000 properties built

The provision of homes with specialist care facilities for older people is set to rocket by nearly 50% in the next four years, according to research from estate agent Knight Frank.

The firm said it expected the number of homes in the “housing with care” sector - also known as extra care - to grow by 48%, from just over 91,000 homes to more than 135,000 by 2024, after becoming a focus of investment.

Guild Living, Epsom scheme

Proposed extra care scheme in Epsom from L&G-backed developer Guild Living

It said that the much more established retirement housing market – popularised by developers such as McCarthy & Stone – will also grow, but at a slower rate, adding nearly 30,000 homes to the existing stock of properties over the same period.

Until recently, the provision of housing for older people has been dominated by retirement housing, which makes up 87% of homes for older people. However, a number of developers and institutional investors, such as L&G, Audley, Riverstone – backed by Goldman Sachs – and Octopus, backed by Schroders, have announced plans to invest in expanding the sector.

> Your essential guide to extra care housing

Knight Frank said: “Housing with care, which includes high levels of services, care and support as an integral part of its proposition, has grown significantly, accelerated by increasing institutional investment.”

However, the report said that while new housing with care and retirement housing will together increase the overall provision of homes for older people by 10% to over 800,000 properties, the growth will be not nearly fast enough to match the forecast growth in the number of people over 75.

This means that the number of units of purpose-built housing for every 1,000 people over-75 will drop from 129 currently to 120 by 2024.

Knight Frank’s report said: “The rate of delivery is still dwarfed by the UK’s ageing population […] A step change in new delivery is required if the huge imbalance between need and supply is to be reversed.”

Eugene Marchese, co-founder and director at L&G-backed later living developer Guild Living, said the development of homes for older people should be a national priority. He added: “The UK needs more purpose-built later living communities, ones that accommodate the individual lifestyle and health needs of their residents by including covid-secure amenities, and on-site care if it is needed.”