Housing and Homelessness

We need more retirement-friendly housing, not more 'retirement housing'

  • Published: May 01, 2013
  • Author: Peter Kenway
  • Category: Housing and Homelessness

Last week, Alex Morton from Policy Exchange argued that "more homes, tailored to the needs of older homeowners, will help free up family-sized properties for the younger generation". The way to do this, his essay claims, is to relax planning laws to allow more homes, "tailored to the needs of older homeowners" to be built. To symbolise the kind of home it thinks older people want, Policy Exchange points enthusiastically to the humble bungalow.

Last year we researched the choice and demand for retirement housing. It quickly became clear that what was available didn't reflect what older people want (i.e. owning a house with two or more bedrooms rather than renting a one-bedroom flat).

Given that only 5% of older people live in retirement housing, the idea that the choice for older people in both general needs and retirement housing should increase is one we can only agree with. However, evidence from an IFS report Housing Price Volatility and Downsizing in Later Life by Banks et al. suggests that we shouldn't be too optimistic that increasing the supply of retirement housing would do much to alleviate pressure on the housing market by increasing older people's willingness to move.

Part of the background research for the paper looked at the housing trends among those aged 50+ in the UK and the US using data up to 2004. It showed that owners aged 50+ in the UK were less likely to move home than those in the US (24% moved in a 10-year period in the UK compared with 31% in the US). But the difference is hardly large enough to suggest that the UK is unusual. Even if you think more mobility would be a good thing, the US data suggests that you shouldn't expect too much.

Given the attention devoted to the supposed lack of mobility of older home owners in the UK, the IFS study triggers three thoughts. First, international comparisons help us see how far the UK is different. Second, more information is needed on housing mobility across the age range and by tenure before and since the start of the recession. Third, having identified the differences, it must be understood to what extent greater mobility elsewhere reflects positive choice. Only then can other countries be held up as an example from which the UK should learn.

Our report showed that the stock of retirement housing doesn't reflect what most older people want nor is it big enough. Not only must the stock grow, it also has to change to reflect the tenure and size that older people want. In itself this is sufficient to justify investment in retirement housing.

But that won't be enough. Most older people don't live in retirement housing and neither will they. If the general needs stock better reflected their housing wishes and requirements, housing mobility among older people would be higher. But in terms of making a substantial difference to the demand for family-sized homes, there is a much wider range of reasons why older people stay put than just a shortage of dwellings, and it would be naive to think that building more bungalows would be sufficient to address the wider housing crisis.

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