Bed numbers in the UK’s care home market have nominally kept up with mounting closures, according to the latest healthcare report from Knight Frank.
The findings show that there was a net gain of 43 beds in the UK during the past year, despite a net loss of 86 care homes.
Knight Frank said the number of new homes being built continues to be counterbalanced by closures.
However, this has not resulted in a loss of overall beds, since typically smaller care homes have closed while larger, more efficient and viable schemes have opened, and existing care homes have been undergoing extensions and refurbishments.
Development hotspots
Meanwhile, South Glamorgan has pipped Greater London as the top hotspot for care home investment and development in England and Wales, according to the research.
This was down to the Welsh county’s strong economic growth and limited levels of new supply, despite the relatively cheap cost of land.
Second-placed Greater London is expected to see over-65 population growth of 500,000 in the next 15 years.
The top five was rounded off by Buckinghamshire, Wiltshire and Berkshire.
Julian Evans, head of healthcare at Knight Frank, said: “With much of the UK’s existing care home stock outdated and elderly population growth expected to drive unprecedented levels of bed demand going forward, it is clear that more care homes need to be built.
“Though there was a marginal net gain of beds over the past year, this is still not enough to address the crisis in provision, and is likely to be further exacerbated as the next generation’s requirements for care grow at a faster rate than new care homes can be developed.
“Our analysis shows that the UK is already short of 100,000 market-standard beds, and this will worsen over the next two decades unless existing stock is upgraded and the rate of new-builds increases.
“Owing to the scarcity of stock and ongoing demand, the investment appetite for new care home schemes remains strong, and opportunities exists for both investors and developers, with our Hotspots Index highlighting the range of opportunities nationally.”
The agency added that many buildings are failing care standards, with two-thirds of those closed rated “inadequate” or “requires improvement”.
This has been compounded by the insufficient funding available for reinvestment into existing care homes, mixed with rising building material and construction costs, which have confined new care home development.
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