Take care: data shows that there are currently only 700,000 senior living units in England

The scale of the problem is underscored by ONS statistics documenting the nation’s growing population of older people. Today, around 12 million people – equivalent to 18% of the UK population – are aged 65 or over. By the year 2066, it is estimated there will be an additional 8.6 million UK residents over the age of 65.

However, data provided by Irwin Mitchell and Knight Frank shows that at the moment there are only 700,000 senior living units in England.

“There is a substantial imbalance between the rates at which our population is ageing and the delivery of seniors housing,” says Lauren Harwood, head of senior living research at Knight Frank. “There is a staggering imbalance and structural undersupply.”

Harwood believes there is a misalignment between local planning policy and an overarching government policy. This has resulted in developers in certain local authority areas struggling to create viable senior living developments, leading to a shortfall in the supply of new units.

The research team set about looking into the shortage of senior living accommodation by attributing A to D planning rankings for all local planning authorities in England.

Rankings were then assigned by reviewing local authority plans for the provision of senior living housing in their area across a number of metrics.

The next stage saw five of the key metrics combined to assess suitability for senior housing and then an overall score was attributed to each local authority. 

Key metrics

These metrics included ONS population estimates and predictions of population change; average property value for over-65s compared with the average property value; the percentage of senior living supply that is private; and the ratio of 65+ households per unit. The local authorities were also assessed by residential land values to identify whether they would be more attractive for private or affordable operators.

Source: Knight Frank / Irwin Mitchell

Since 2017, when Irwin Mitchell created this methodology, the percentage of A-graded local authorities – those that have clear policies in place indicating details of the required number of dwellings, how this will be achieved and specific site allocations – has gone from 9.7% to 18.6%, revealing a marked overall improvement in allocation since the company’s data collection began.

However, 50% do not have any specific planning policies according to the data – down from 62% in 2017.

This year, Horsham, Camden, and Kensington and Chelsea scored the highest in terms of opportunity areas for private senior living developments. Cornwall, Leeds and Cheshire East topped the overall affordable opportunity score, which suggests they are the easiest places to create affordable senior living developments.

City living

Generally speaking, cities do not score highly on the list. London has included a policy for delivering senior living homes across the capital as part of the new draft London Plan, which in the past three years has helped create 2,100 new units. But this is not sufficient, according to Nicola Gooch, planning partner at Irwin Mitchell.

“If you take the city as a whole, it does not perform as highly as it should considering the demographic shifts,” she says. According to the research, 22 London boroughs do not have a credible planning policy in place or site allocations to address the housing needs of senior citizens.

Local authorities that have failed to develop specific planning policy for senior living developments are in part hamstrung by the ambiguities of the existing planning system. One of the major stumbling blocks is the use class that senior living developments fall under. “There isn’t a use class for senior living,” says Harwood.

They could fall under C2, for instance, which includes residential accommodation and facilities for people in need of care, or C3, including dwelling houses. The categorisation can have a big impact on whether a development is financially viable due to community infrastructure levy (CIL) obligations and affordable housing requirements.

We need to start planning for our ageing population

Lauren Harwood, Knight Frank

If local authorities put concrete policy plans in place for senior living developments, it could clear up a lot of confusion, believes Claire Fallows, a partner at Charles Russell Speechlys.

“It is not the use class itself that determines whether affordable housing or other policy requirements apply; it is the detail of each authority’s own policies and how they apply to particular types of development,” she says.

The problem at the moment is that different local authorities categorise senior living differently and this is having a major impact on the ability of developers to deliver units in areas where they are needed.

Take Cheshire West and Chester, for instance, which ranks sixth on both the overall planning score and the private development rankings. For C2 use, it has no affordable housing or CIL requirements.

Make or break distinction

By contrast, in London an extra-care type facility falls within C3 use class and affordable housing is therefore expected. This distinction can make or break a scheme.

“A local planning authority’s expectation that a genuine ‘extra care housing’ development should, for example, make affordable housing contributions can result in the development simply becoming unviable and failing to make it to market,” says Rory Bennett, associate at Linklaters.

To unlock the potential of senior living in England and ensure that sufficient units are delivered to meet the projected growth in the nation’s elderly population, Gooch argues that all local authorities need to take the same approach.

“There has been a marked improvement in the number of local authorities planning for seniors housing in recent years, but there is still a long way to go before the necessary support is in place to deliver our population’s elderly housing needs in full,” she says.

Gooch adds that the current “patchwork approach to local plans is holding back the development of the sector and needs to end”.

It is a view shared by Harwood, who says: “It is time for both central and local government to take the demographic shift seriously and start planning at the very basic local plan level for our ageing population.”

If this does not happen soon, there is a danger that the supply-demand imbalance of senior living units in England will continue to widen. 

Click here to read Knight Frank/ Irwin Mitchell’s report