Tim Seddon, chief executive of AXA-backed Retirement Villages Group, discusses the need for a focus on later-living housing in a bid to effectively tackle the housing crisis.
In its inaugural Budget, the government has taken its first real steps in tackling one of the defining crises of our time: the UK housing crisis, with £5billion promised in new housing investment.
The Chancellor’s announcement of greater overall investment is both welcome and necessary. However, going forward the government must also work to address the housing needs of our ageing population to unlock the market so it works for all.
Measures to incentivise downsizing and bolster the supply of high-quality, age-appropriate housing would not only free up housing for younger families but would also help older people find homes that truly meet their needs.
I was encouraged that the Chancellor decided not to raise stamp duty on people’s primary residences, but more direct interventions are needed. One solution with growing levels of support is to cut or even abolish stamp duty for over 70s, providing a major incentive for people looking to downsize.
Many older homeowners stay too long in large, under-occupied homes because they face significant financial barriers to moving. Stamp duty acts as a deterrent, discouraging older homeowners from moving into homes better suited to their current needs. Eliminating this barrier would mean older people making better, age-appropriate housing choices and would also unlock larger family homes for younger generations.
For these policies to truly work, we must also ensure the supply side is working. Suitable, attractive and financially secure options must be available to older people. Independent Retirement Communities (IRCs) represent an ideal solution by offering more than just age-appropriate living spaces – they provide communities where older individuals can live independently with support and enjoy amenities that enhance their quality of life. But we need to build them faster.
In the budget, the Chancellor gave local authorities more money to recruit hundreds of new planning officers to help “get Britain building”. Although this is promising, our current housing stock is simply not designed with older people in mind.
Reform is needed to help make it easier to green-light IRCs across the country. This should include requiring local authorities to have a targeted policy that considers the level of need for older people’s housing. It is crucial that local authorities allocate sites specifically for IRCs in suitable locations connected to communities, to reap the benefits retirement communities can bring to the local area.
The later-living residential sector must also seize this moment and reform its practices. Currently, our sector faces trust issues due to reports of hidden fees and poor-quality housing. A recent study by the Association of Retirement Community Operators (ARCO) found that 90% of over-65s are concerned about hidden fees in retirement housing, creating a real barrier to downsizing. The industry must address this with absolute transparency.
Retirement Villages Group is piloting a new financial model with reduced weekly management fees, covering amenities like staff, grounds, and wellness services through a deferred fee paid upon resale. Residents face no additional charges – no admin, ground rent, or refurbishment fees – and enjoy a 999-year lease. When resold, the original purchase price is returned minus the deferred fee, providing a lump sum without market risk for the resident or their family. We are striving to provide simplicity for residents and their families so that IRCs can become a more straightforward choice for older people.
A dedicated commitment to incentivising downsizing and supporting the development of more high-quality retirement communities would be a logical, pro-growth step toward solving the housing crisis. So, while we welcome the measures announced in the Budget as a promising step towards the government’s housing goals, further, decisive action is needed to address the housing challenge faced by the country’s growing, older generations.
