Why Build to Rent is essential for older people too

The Build to Rent sector is of growing interest to investors. Last December Knight Frank said that £15bn had been invested in the sector, and its latest statistics suggest that institutional investors will commit to a total of £50bn by 2020.

Two large investors have also just signalled their entry into this sector. Grainger plc has committed £850m between now and 2020, whilst Legal & General Capital also announced that it is to become more involved in the ‘Build to Rent’ market in the UK. The company plans to spend £600 million providing 3,000 units to let. It also highlighted that in its view, the rental market in the UK is ‘dysfunctional’ and that for this to change, renting must become more affordable.

Much of the investment is aimed at young professionals working in urban areas. The first homes to be funded by Legal & General Capital will be in Bristol, Salford and Walthamstow. We are keen to see more investors targeting the retirement sector too.

Many older people want to downsize when they are older. A recent report from retirement housebuilders McCarthy and Stone called ‘Generation Stuck: Exploring the Reality of downsizing in later life’ highlighted that a third of the UK’s homeowners aged 55 and over are considering or expecting to consider downsizing. However most aren’t able to because of the shortage of specialist retirement homes.

More needs to be done to encourage build for rent that is affordable and appropriate for the needs of the older generation, especially given that by 2030 it is predicted that a quarter of the UK population will be aged 65 and over.

For an investor, the fact that a quarter of the population will be over 65 in less than 15 years’ time would suggest this is a market worth investing in and we hope that more investors and housebuilders will recognise this soon.

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