Why we are building retirement villages.
My initial interest in retirement housing was triggered by reading a business biography written by Duncan Bannatyne. He suggested that there would be great opportunities for entrepreneurs around what he called the “grey pound”, which is the money that is available from our aging population. He highlighted the aging demographics within the UK. I thought about it and realised that housing was certainly one area that was an exciting opportunity for this sector. I became quite excited about the opportunity as it fitted with my aspirations to build a UK wide business. I started to think about the business model. I thought about the advantages of living in a retirement community for the customers, there were so many! However I ran into a dilemma, I felt that perhaps it was morally wrong to segregate people, for any reason & especially because of age. I thought that it was not good for our society to build communities that children & older people were not living together. I came across a report by the Rowntree Foundation on retirement housing and it gave me complete clarity. A very large proportion of our over 65s are living very lonely lives. They are lonely because they are living in areas where their neighbours have to go out to work to pay their bills. It requires both parents in most homes to be working now. So we end up with a large and growing section of our communities who are living lonely and isolated lives, especially during the working week. This convinced me that it makes sense for retirement villages to be constructed.
We are in the business of creating communities for people whose children have grown up and left home. Quite often older people end up living alone, not because of choice but because of family circumstances. This can include the death of a spouse, divorce or perhaps their children moving away from their area for employment and opportunities.
Retired people are looking to live in communities that give them life. There is a reluctance to move to any development that is based around care in anyway. When people retire they are planning on living and enjoying life, they are certainly not planning on a journey to a nursing home. Seniors are happy to move to nursing homes and or assisted living accommodation when they get to that stage. Many people that move to retirement communities as a single person for whatever reason, can end up in second relationships.
Very often new friendships are formed in retirement developments that open new hobbies and pastimes for individuals. Retirement developments have been happening in the USA now for several decades and there is statistical evidence that people who move to them are living longer and also living independently for longer.
Retirement villages are required throughout the UK to cater for the ageing population. There is an opportunity to reinvigorate some high streets by creating retirement developments. There are also community land owners including councils, churches, schools & medical facilities that are in areas that would lend themselves to retirement developments. For local communities that are concerned about the lack of life & sustainability in their existing towns, villages & high streets there is an opportunity to create a new heart.
Many UK residents approaching retirement age have more capital tied up in their homes than they have in their pensions. There is a growing need for this sector of the population to be able to release capital along with moving to a home that is more suited to their ageing. This includes smaller properties with lower maintenance. There is also a social & emotional need to be living in community. When people stop working it can be a difficult time & the loss of social contact can have a massive bearing on their mental & physical health.
There is a large opportunity for providing rental properties to this section of society. We believe retirement village properties will be a recognised asset class in the future. They create stable long term income for investors. One of the impacts of this model which we believe will develop is that there will be a loss of inheritance which will impact on children & grandchildren. We don’t know the statistics but we believe a lot of inheritance recycles back into the housing sector through parents providing significant contributions to the purchase of their children’s own homes & quite often their first purchased home. This could well impact on the profile of home ownership. There could also be an unwritten rule with this type of assistance that the “investor” will expect to be supported by the “recipient” either financially or emotionally in their declining years. Many purchasers in retirement villages use the opportunity for inheritance tax planning. Their new homes can be purchased by their children for the occupation of their parents. The age restriction on retirement villages is based on the occupant as opposed to the owner.
We are only starting our journey on retirement Housing Development & it’s inevitable that we will be learning from every development. We are also aware that different parts of the country will have specific requirements unique to that community & we will welcome input on all aspects of the development. What is interesting about our current pipeline of development projects is that we have be approached by locals & or councils who have recognized the need in their area & the positive impact that it can have for their community to have a retirement village in their area.
If you feel that there is a retirement village required in your area please feel free to get in touch.