McCarthy Stone welcomes new report from Policy Exchange on housing for an ageing population

3rd December 2018

McCarthy Stone, the UK’s leading developer and manager of retirement communities, welcomes today’s report by Policy Exchange, Building for the Baby Boomers, and its recommendations on improving the housing market for an ageing population. Its recommendations include:

1. Government should remove the 2 per cent stamp duty band – which is levied on those buying homes between £125,000 and £250,000 – for older homeowners looking to move home

2. The growing number of older people renting privately – projected to be a third of all retirees by 2040 – demands greater attention from Government:

  • More consideration should be given to how older renters without adequate retirement savings are supported by the state in later life
  • Government and local authorities should look to attract more institutional investment into the retirement housing sector and this should be directed towards private rental housing
  • Local authorities should consider exempting rental retirement schemes – where profit levels tend to be lower but where need is only going to increase – from needing to provide capital sums upfront as part of their planning obligations

3. The planning system should be used as a vehicle to encourage new models for retirement housing. For example:

  • Exempting retirement housing developers from financial obligations faced by mainstream developers would help them compete more effectively in the land market and could result in higher delivery of retirement housing.
  • Government should look to encourage local authorities to waive planning obligations when the development provides a suitable amount of housing for the intermediate retirement market.
  • In its forthcoming Social Care Green Paper, Government should acknowledge the widespread perception that local authorities face a financial disincentive when the number of older people living in their area increases – which discourages them from approving new retirement housing schemes (albeit most of McCarthy Stone’s customers move from the local area).
  • Local authorities should be encouraged to review the need for specialist housing for older people across all tenures as part of their housing market assessment that informs their local plans

4. It is sensible retirement housing has been exempted from Government proposals to cap ground rents on new leasehold properties. Much of the recent controversy centres on mainstream housing developments where homeowners faced escalating and onerous ground rents rather than retirement housing specifically

Gary Day, Group Land & Planning Director of McCarthy Stone, said:

“We support the recommendations made by Policy Exchange in this report. Retirement communities have a hugely positive impact on the well-being of older people, allowing them to live happier and healthier lives. Yet moving costs – particularly stamp duty – are holding them back. 2.6 million1 people would be encouraged to move with a downsizing exemption, freeing up housing supply for families and first-time buyers, and reducing the state’s social care burden.

“There is also an urgent need to build more suitable housing that meets the different needs of those in retirement. Despite demand, just c.162,000 retirement properties have ever been built for older homeowners, a woeful undersupply for the UK’s rapidly ageing population. Planning policy is largely silent on the housing needs of older people - if the right policies and incentives were introduced, and the financial obligations and regulatory challenges faced by retirement developers addressed, supply could increase from around 6,000 units a year currently to 20-30,000 units a year.2

-ends-

Please contact Mazar Masud/Victoria Heslop for more information on [email protected] and +44 (0)20 7250 1446.

Notes to Editors

McCarthy Stone is the UK’s leading developer and manager of retirement communities, with a significant market share. The Group buys land and then builds, sells and manages high-quality retirement developments. It has built and sold more than 56,000 properties across more than 1,200 retirement developments since 1977, and is renowned for its focus on the needs of those in later life.

There is growing demand for retirement communities. There are currently 11.8 million people aged 65 or over, rising to 17.3m by 2037, representing a 47% increase3. For those aged 85 or over, the increase will be larger, from 1.6m to 3.0m, representing an 87.5% increase. One in four over 60s are interested in retirement living4, yet only c.162,000 units of specialist retirement housing for homeowners have been built5.

McCarthy Stone has two main product ranges – Retirement Living and Retirement Living Plus – which provide mainly one and two bedroom apartments across the country with varying levels of support and care for older homeowners. Retirement Living developments provide independence in private apartments designed specifically for the over-60s, as well as facilities such as shared lounges and guest suites that support companionship. Retirement Living Plus developments, which are designed specifically for the over-70s, offer all of this plus more on-site facilities such as restaurants, well-being suites and function rooms. Importantly, they also provide flexible care and support packages to assist those needing additional help.

All developments built since 2010 are managed by the company’s in-house management services team, providing peace of mind that it will look after customers and their properties over the long term. This is a key part of how McCarthy Stone seeks to enrich its customers’ lives. This commitment to quality and customer service continues to be recognised by homeowners. In March 2018, the Group received the full Five Star rating for customer satisfaction from the Home Builders Federation for the thirteenth consecutive year – making it the only UK housebuilder, of any size or type, to achieve this accolade.

The Group was also pleased to win 20 awards at the 2018 NHBC Pride in the Job awards, marking a 33% increase in awards from 2017. The scheme recognises construction site managers who achieve the highest standards in housebuilding and has been instrumental in driving up standards in the sector for 38 years.

1 McCarthy Stone Retirement Confidence Index survey of over-65s, August 2018
2 Knight Frank: Retirement Housing (2016)
3ONS household projections: 2016-based (2018)
4 ONS (2017, 2014 based figures)
5 Knight Frank, Retirement Housing (2018)