George Cardale, National Head of Residential Development Sales at Savills outlines a growing market that requires premium property in primary locations.
Housing for the over 55s is a growing market. Rising demand from this market is driving developers to build far more desirable property across a variety of locations to satisfy both lifestyle and need driven purchasers.
The Telegraph reported recently how almost eight million over-55s are living in houses that will be unsuitable for them as they age and The National Housing Federation has warned that more than 100,000 new homes must be built specifically for older people to meet the needs of an ageing population.
Pictured is a development in Norton St Philip, eight miles south of Bath, specifically for the over 55s.
This need has been acknowledged by the investment community and some big funds have now invested in this sector to provide development finance for 55+ developers.
For many groups of buyers aged 55-70, it is a fair assumption that their move is more likely to be lifestyle driven than need driven. These downsizers are looking to release equity for their children, they want to travel, be part of a new community and recapture ‘their time’. It is this group of buyers who are often mortgage free and who will pay premium for quality.
Downsizers will buy in the key heritage cities with established city centres. They won’t necessarily move across country, for instance someone living in the Norfolk countryside won’t decide to move to Bath (unless they are moving to be closer to their children), but if they live in Somerset, moving to Bath is a natural choice.
I estimated that one third of my buyers in Bristol are over-55 and they will buy the best apartment in any scheme, they want the biggest, the highest or the best apartment. They will generally spend half to three quarters of what they sell their previous house for and use the remaining cash to clear any debts, buy somewhere overseas or help their children get on the housing ladder. The added benefit, if they buy new build, is that they will have a low maintenance home and garden, with relatively little up-keep.
For those aged 70 and upwards a move to downsize is far more likely to be need driven and will have a much greater need for care services and technologies to enable them to live independently for longer.
Mainstream developers of new build premium property would be wise to pay attention to the over 55s. This group of downsizers are likely to be competing over the very best properties their schemes have to offer.
George Cardale is National Head of Residential Development Sales at Savills. Savills Residential Development Sales represents new-build developers around the country. To discuss being represented by the Savills sales team, email firstname.lastname@example.org To see the current selection of newly-built properties available through Savills, go to www.savills.co.uk