This House of Commons Library briefing paper discusses the challenges around providing housing for older people in the midst of both a growing population and a still recovering housing market. It covers issues around housing stock; adaptations; retirement housing and asset release.
Download the full report
- Housing an Ageing Population (England) (PDF, 465 KB)
This brief applies to England only.
Housing stock provision and an ageing population
Successive Governments have failed to provide housing in requisite quantities, which current estimates put at 250,000 per year. After a 2007 high in recent years of 219,080; build rates have not exceeded 200,000 per year, with an average of only 141,098 since 2010. Numbers of people aged 65 or over, conversely, are on the rise with an increase of 47% between 1974 and 2014; making up nearly 18% of the population.
While owner occupancy has seen a gradual decline since the 1990s among the younger demographics, it has remained fairly consistent for older people despite the economic crisis of 2008. Home ownership is high among 65-74 year olds at 79% in the 2013/14 financial year; compared to only 9% and 36% for 16-24 and 25-34 year olds respectively.
Among owner occupiers across the board, but particularly so for those aged 50 or over, under occupation (more bedrooms than occupants) is an extremely common arrangement; with a majority in the age group having two or more spare bedrooms than necessary. This has led to calls for older people to ‘downsize’ in order to free up stock for families and younger people and to release housing wealth. Evidence exists for an appetite for downsizing, however indications are that a lack of the right sort of stock, in terms of amenities; size and accessibility, could be holding up progress. Exemption of older social housing tenants from the ‘bedroom tax’ has met criticism from some quarters, however others caution that applying it to the demographic would both miss the intended mark of increased employment and lead to ‘pensioner poverty’ (with its inherent social and medical costs) outweighing the potential monetary gains.
Accessibility in housing
Understandably, a large proportion of older people wish to remain in their existing homes, despite fears that poor accessibility could render them a challenge to maintain or even a threat to health and wellbeing.
Sector experts have suggested that it is general housing stock that will take the strain of the ageing population and that therefore more needs to be done to raise standards in accessibility and in provision of adaptations for independent living. Despite this, the large majority of homes fail to meet Government accessibility definitions and 1 in 4 do not possess any accessibility features at all.
The National Planning Policy Framework (NPPF) tasks local planning authorities with delivering accessibility standards, which since October 2015, have been largely in line with the Lifetime Homes Standard: a set of 16 design criteria designed by housing experts in the 1990s and intended to provide suitable accessibility provisions at minimal cost. Though experts such as Paul Gamble, CEO of Habinteg housing association have welcomed the implementation, they warn that while the standards remain optional, ‘the campaign for the supply of accessible homes goes on.’
Since 2005, the Greater London Authority (GLA) has required all new homes to be built to the Lifetime Homes Standard. While Paul Gamble welcomed this move he emphasised the challenge of enforcement and monitoring. Indeed, the 2015 Plan records a fall in homes completed to the standard in 2013/14.
Governmental funding for accessibility and adaptations comes from a number of sources. The Homes and Communities Agency (HCA) provide both the Affordable Homes Programme and the Care and Support Specialised Housing Fund (CASSH). Home improvement agencies and local handypersons are also funded, via local authorities, to deliver small home repairs and adaptations. The Chancellor further announced in the Autumn Statement 2015 that 400,000 affordable homes were to be started by 2020/21, with 8000 being specialist homes for older people and people with disabilities. Disabled Facilities Grants (DFGs) are available for adaptations facilitating access into and within the home. Concerns both over funding provision, and DFG’s integration into the Better Care Fund, and suitable usage of DFGs by local authorities have been raised previously. The issues around adaptations to communal flats have also been raised, with a number of pieces of legislation having been put in force to address the issue, though not conclusively. The Equality Act 2010 looked to make it illegal to victimise disabled tenants on account of costs incurred in making adjustments; and provided a process by which such adjustments could be requested, however these provisions were not brought into force. The Coalition Government decided to review the Equality Act under its ‘Red Tape Challenge’ and it is not clear whether these provisions will be put in force in the future. The Chancellor’s Autumn Statement 2015 committed to providing £500m in funding between 2019/20 to cover 85,000 home adaptations in that year.
Only around 5% of housing for older people is made up of specialist homes, despite evidence of a much higher demand. Local authorities have been accused of being reluctant to approve development plans out of a feat of increased care costs, however councils have responded that the introduction of the care cap could present ‘significant new burdens … that will either be underfunded or not funded at all’. Some have suggested that planning constraints have also caused the UK to lag behind comparable countries; with build rates lower than in the 1980s.
Studies have shown substantial savings to the NHS from specialist housing. A study by Aston University on residents of properties run by Extra Care Charitable Trust found that the NHS saved £1,115 per person, per year (a cost reduction of 38%) against comparable residents in the surrounding area. Others have posited the health benefits of building specialist housing in the midst of family homes, with a view to combatting loneliness and ghettoisation. Many in the sector feel that a closer working relationship between health, social services and housing is of paramount importance.
While recognising the market for retirement housing, some have warned of ‘sharp practices’ by leasehold retirement housing providers. The properties have been accused of representing a potentially heavy financial risk to their residents on account of their propensity to drop in value as lease lengths decrease and because of their incumbent service charges and exit fees. An investigation by the Office of Fair Trading (OFT, now the Competition and Markets Authority) found that leasehold retirement housing providers’ transfer fee terms, as typically drafted, are likely to constitute unfair terms. They decided not to test this legally however on account of the voluntary moves undertaken in the industry. The Law Commission is now considering the matter of hidden fees in lease agreements for retirement housing.
Local authorities have been accused of focusing on care provisions over preventative models of housing. A report by Demos compared the experience of two housing providers to demonstrate the point – one finding it relatively easy to gain planning permission for extra care facilities, while the other struggled to provide traditional owner-occupied housing for older people. Concerns over planning rules have also been highlighted, with private retirement housing remaining subject to section 106 and Community Infrastructure Levy contributions. An image problem for specialist / retirement housing has also been forwarded, the stock being cursed with the incumbent financial and planning considerations of general needs housing alongside an incorrect association with care and lessened independence due to confusion with care homes. Some have suggested abandoning the term ‘retirement housing’ altogether in response. Finally, the psychological and physical barriers to moving faced by older people are a consideration that must be addressed in order for specialist housing to play a greater role.
Other initiatives: Homeshare and Asset Release
Alternative approaches to the overarching issue have been suggested from a number of quarters.
Homeshare is a scheme which sees older people open their homes to younger temporary lodgers; exchanging very low rent for an agreed amount of support (short of care) to the older person. This generally takes the form of help with shopping and household chores, as well as general companionship to countermand loneliness. The scheme now runs nationally in the UK and is overseen and administered by a not-for-profit organisation called Shared Lives Plus. There are comparable schemes running internationally.
Many have suggested that older people should draw on the property wealth tied up in their homes to fund care costs and home maintenance etc. Equity release plans such as lifetime mortgages and home reversions exist to this end and have seen increasing popularity over recent months. This is not without caveats however. While average wealth among older people may appear relatively high, this is heavily skewed by those at the top. The median value is much lower, and the lower quartile disproportionately so. There are also major variations by geographical region. Furthermore, apprehensions exist over equity release schemes, which can accrue major debt on account of their compound interest. Though many offer ‘no negative equity guarantees’, ensuring that no more than the value of the property that the loan is guaranteed against is owed by the older person; this can result in the inability to provide an inheritance and a far greater loss over time than the gain from the initial cash payment.
Download the full report
- Housing an Ageing Population (England) (PDF, 465 KB)