What Does The Latest JLL Housing With Care Index Say About The Sector?

Publication Date18 May 2021
SubjectEmployment and HR, Real Estate and Construction, Retirement, Superannuation & Pensions, Real Estate
Law FirmGowling WLG
AuthorDominic Morris

The housing with care market has grown considerably over the last decade, and with an increasingly elderly population in the UK, demand for senior living provision continues to rise.

In this latest podcast from our senior living team, Dominic Morris is joined by Anthony Oldfield, director in the Healthcare Capital Markets team at JLL, to talk about the findings of the latest JLL Housing With Care Index.

We discuss the current growth and sales performance trends in the housing with care market and likely future growth opportunities.



Dominic Morris: Hello. I am Dominic Morris, head of the Senior Living Team at Gowling WLG. Today in our Senior Living Podcast series I am joined by Anthony Oldfield, a director in the Healthcare Capital Markets Team at Jones Lang LaSalle (JLL). We are going to be talking about the findings of JLL's Housing with Care Index report that Anthony and his team have launched this week. So, hi Anthony.

Anthony Oldfield: Hi Dominic, good to be here.

Dominic: Great to see you. Could you tell us a little bit about yourself and your team, and the work you do?

Anthony: Yes, sure, thank you. So JLL is a global professional services firm specialising in real estate and investment management. We are a big firm but within that, my team specialise in healthcare property and we have a particular focus on care homes and later living assets, and the housing of care parties is in that later living bracket.

Dominic: Fantastic. So today we are going to talk about your Housing with Care index. Can you introduce that to our listeners, what it is all about, what its origins are and what you are aiming to do with it?

Anthony: Yes, sure thanks. So we are obviously really keen to be producing quality research that helps our clients understand this part of the property sector. It is a nascent part of the property sector, it is growing a lot but clearly investors, advisors and landowners need data. If they are going to build more accommodation and invest because, you know that is important to us, we believe the UK needs more of this housing division that really benefits older people. So we have produced a number of reports over the last few years, including one looking at demand where we were saying what the potential demand picture out there is in the UK. Another one on how to actually get into later living, what do I do, what is housing with care, all that sort of thing, so that is in our How to Deliver It report. Then interspersed with those we have done what we call our Housing with Care Index, so that is now in its third edition, which we have just launched this week (May 2021).

The point of the Housing with Care Index really is to track the performance of the sector. So it looks at how the units are growing in value. Really the point behind that, or the reason it came about is, a few years ago there was quite a lot of bad press over retirement housing and the fact that values were falling on re-sales and disgruntled families saying, well hang on my granny has paid '200,000 for this flat and I am selling it for '100,000, what is going on? So we wanted to look into this on behalf of our clients to see what the re-sale performance was. So just to get a little bit "techy" at the start, just to sort of explain what we are talking about with housing with care, we are not talking about sheltered housing, which has been around for a long time. We are talking about housing where an older person will have their own apartment and there will be on-site amenities, including a restaurant, 24-hour staff and a care provision on offer.

What we have done with our Index is we have taken the Elderly Accommodation Counsel's definitions. They categorise all the schemes that are targeted for older people across the UK and we have taken their housing with care ones, which they sub-categorise into extra care, enhanced sheltered and close care. So it does not include what they call the housing with support, which is your basic sheltered housing with a warden and a lounge. So we think there is a distinction between those two buckets, I know it is a bit "techy" if it is the first time anyone has come across later living, but it is important to understand that distinction.

Dominic: It is probably worth saying for our listeners that much of this space is sort of self-regulated by ARCO, the Associated Retirement Community Operators, so their members will all fit into this housing with care model, but it goes slightly wider than that.

Anthony: Yes, yes it does. You are right. All the ARCO members are in there, but there are others. So McCarthy & Stone is a good example - some of their units would be classified as housing with support and others would be housing with care.

Dominic: Perfect. Our listeners probably do not need to be told, I guess, the demographic context of this, but there has been a recent excellent report from Octopus Real Estate on the opportunities presented by the sector and looking at the buyer retiree perspective. But they are citing figures saying by 2039, 25% of our population will be over 65, and even now they have identified potentially 2.5 million retirees who could be interested in buying into this...

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