Care Home Investment Opportunities For Property Investors

Care home investments are a fairly recent type of property investment, but nevertheless it is a strong preforming asset class for investors in the UK and even overseas. This commercial property investment offers an alternative to traditional buy-to-lets as well as having a significant financial return.

The Care Home Investment Market

The care home market is driven by a rising life expectancy and an increase in the number of over 65’s living in the UK. The Office of National Statistics found that 65’s and over make up 11.4 million of UK’s population, meaning the elderly make up 18% of UK’s population. This number is expected to further increase to 25% by the year 2044.

The ageing population calls for an increase in care homes and retirement housing communities around the UK. The demand for long-term health care facilities is also rising and it is forecasted that the UK would need to increase the supply of residential and nursing homes by 150% and an additional 140% increase in hours of care, which the NHS is currently struggling to uphold.

The Health and Social Care Industry is currently worth more than £20 billion and along with the increase in demand, it is easy to see why investors are utilising these figures to make a profitable investment.

Not only are care home investments helping investors to get an income with long-term high returns, but private investments within the health and social care system is also relieving the strain put on government facilities.

care home investment opportunities

Is A Care Home Investment Good For Your Pension?

When you look at an investor’s point of view, you can see that although the social and economic implications of the ageing population are complex, they still provide opportunities for property investors.

One of those opportunities is that care homes can be placed in a pension. Care homes could be perfect for your retirement fund as more and more people are using their pension savings to put into an income-generating property.

Two years ago there were new freedoms put in place that gave retirees more choice in where they can invest their pension.

Care homes are a great investment for retirement income and it can also be a good investment if you wish to live in the care home property later on in life. Even though there are more care home developments going on in the UK, it doesn’t yet dampen the seriously high levels of demand, making it an asset class with strong yields on average than other classes.

Care home investments are also fully managed by third parties and care for patients is done by employed staff, making it hands-free for the investor. There is also a long-term assurance of a 10% net rental yield per annum for up to 10 years. With prices varying at £70k-£80k, it makes a good investment for your pension.

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