By Michael Hardware, Director of Planning and Property
Using excerpts from ‘Later Living: Are we planning for our future?’ published by Barton Willmore, we take a look at the changing profile of the later living population and what challenges and opportunities this poses for the market. Barton Willmore’s full report can be viewed here.
The Government has been pushing hard to increase housebuilding and resolve the housing crisis. It wants to address the historic housing deficit and pent-up demand that has led to massive house price increases in recent decades. It has also introduced initiatives to encourage and assist the younger generations to get them on the housing ladder but has paid little attention to older generations which are in effect ‘bed blocking’ at the other end of the property chain.
As their children leave home and they reach retirement, older people look to downsize and release equity from their properties. According to the ONS Wealth and Assets Survey by the Centre for Economic and Business Research (Cebr), the average older home-owning household has £200,000 of property wealth and the over 65s account for 39% of the total of all property wealth. This is likely to increase to 41% by 2036.
Looking at the 45-55 age group, who will enter the 65+ age bracket in the next two decades, the growth is at the lower end of the property wealth scale with assets expected to be at around £163,000 at retirement. Over the next 20 years, this group will increase tenfold, the equivalent to 4.5 million people aged between 45 and 65 entering the market with half the wealth of current retirees.
The housebuilding industry has a challenge on its hands: how does it facilitate mobility in this older group, enabling downsizing, or ‘right-sizing’, and freeing up much-needed family homes? The answer must be in providing more choice in the new homes to meet those needs.
Currently the later living property market is directed at the largest and most affluent group of people, the 2.9 million people over 65 who have property wealth of more than £300,000. This will need to change.
Huw Edwards, a Senior Partner at Barton Willmore, explained:
“The market needs to respond now to ensure that we are planning and building housing for older people that meets their changing needs and demands.
“This will not only provide the homes that are needed and wanted by our ageing population but also open up family housing to the market and directly address our housing crisis.
“To achieve this, there is a need for a more coordinated and thought-out approach to delivering homes that meets the diverse needs of older people.
“At the local level, this means evidence based strategic policies for older peoples housing, coordinated across planning authorities that fall within the same housing market areas.
“There is a real opportunity here to encourage diversification of the market, provide homes that older people want, and create a market that caters for the broad spectrum of needs and demands it encompasses.”
Chelgate and Barton Willmore are co-hosting a seminar this month looking at the impact of an aging population on housing provision. The keynote speaker will be Lucy Seymour-Bowdery from the Ministry of Housing, Communities and Local Government, who will outline the new policy and guidance to be issued by the ministry which she has written. She will be joined by speakers from planners Barton Willmore, Maidstone Borough Council, McCarthy & Stone and Retirement Villages Group. Further information can be found here.
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