"Your last home should be your best home", was a statement made by Kevin Beirne of One Housing earlier this month at a Future of London (FoL) roundtable, focusing on the challenge of housing our ageing population throughout London, but equally across the UK. I’m not sure I completely agree with the statement, but I get his point.
In a country where home ownership is the ultimate goal, there is a need to improve with every 'step on the ladder', even if this does mean a step which reduces the scale of that home. Our home is, after all, our castle. My issue lies around what is 'best'? Do we really know how those reaching 60+ feel about their homes and the lifestyles they want? ‘Best’ is probably not about scale, but by the age of 60+ we generally have accrued a lot of stuff in life, and we have family we like to visit us. Perhaps we like a garden or indeed we can’t manage one anymore. Maybe we want an urban lifestyle from which we can tap into more community activities and socialise more easily.
There is never going to be one 'best' to fit everyone, just like there isn’t one house type in the UK that we all want to live in, and, not least because, the property equity and pension wealth varies massively across this age group, as any other. To inform views a little further however, my colleagues are currently conducting some research into this wealth distribution pattern, to see if we can understand the opportunities and challenges more fully. It’s a surprisingly difficult area of the market to get under the skin of, to be honest, with 'Use Classes' complicating the ability to track volume or price points, while the mosaic data (method for understanding socio-economic patterns more specifically) shows how the nature and complexity of this age group is changing.
Our research continues (we hope to publish before the end of the year), but what we do know already is that a key challenge is the significant gap in the offer for those over 60 lying in the 'middle market'. These are people who perhaps own some or most of their own home, but still can’t financially access the current later living offer, either at the premium or social housing end of the scale. This is the area of the market where loneliness and bed blocking for the NHS is at its height, but where purchase prices and service charges are off-putting for those willing to 'right-size'. They have spent their lives saving to reach the pinnacle of home-ownership – the ‘best’ - and if they are now mortgage free what would entice them to unsettle this stability? Does this come down to lifestyle over the home itself?
As an industry building our understanding of the lifestyles that will soon account for 50% of our population is key to keeping our property market moving. As an industry, variety is essential surely the current polarised offer does not meet the needs of a vast tranche of our emerging ageing population and it is even less likely to fit that emerging in the next 10-20 years. Alongside this need for greater variety of product, we also need to get better at communicating the offer. Do people across the UK understand the opportunities and products fully? There is a strong feeling and evidence that they do not. In my world of Business Development, we talk about 'building a motivation to buy' as opposed to selling to people. That we show the opportunity and how it fits with your needs, and as such you want it rather than we sell it. A simple concept but can we do more of this in the later living market? Can we make 'right-sizing' aspirational, make it fit people’s needs and remove their challenges, and then communicate this offer in a transparent and easy to understand manner – both in terms of products and costs?
The Future of London study we are supporting, alongside British Land, Arup and Pollard Thomas Edwards will be released early next year, along with our full wealth review, both of which will hopefully take us one step closer to understanding more about this complex but key market for the residential sector.
For a write up on the first roundtable held click here.
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Later living, ageing population, Future of London, Development Economics