The UK care home sector is burgeoning. However, it’s also very fragmented and facing some significant challenges when it comes to resources and funding. In the UK there are now some 20,000 care homes, nursing homes and residential homes that are the first port of call for adult and elderly care around the country. With demand expected to rise steadily over the next decade it’s important for the sector to address the current problems that it has so that these don’t become obstacles in the future.
What does the UK care home sector currently look like?
Of the 200,000 care homes in existence, some of these are independent, others are operated by charities and voluntary organisations and the rest come under the remit of the NHS or local authorities. There is a great deal of development taking place in the care home sector but the majority of this is aimed at the private market. Across both the private and public care home sectors it’s thought that roughly 6,700 new places will be required each year to 2020 to satisfy demand.
What specific challenges exist?
An ageing population
The UK has an ageing population and this is putting a great deal of pressure on existing care home resources. Demand is only likely to increase over the next few years and that means that there is a critical need for new facilities to accommodate this.
Government cutbacks and underfunding
Those care homes that are managed by local authorities or the NHS have seen their resources significantly reduced in recent years as a result of government cutbacks and funding reductions.
Sub-standard care home stock
Although there has been a lot of investment in care homes over the past decade there is still an issue in terms of quality standards. Much of the existing stock is currently classed as sub-standard and many homes simply don’t have the facilities to cope with the need for specialist care such as that required for patients with dementia.
Availability of sites
There is currently a lot of competition in the care homes market with respect to finding the right sites that can be used as locations for new care home development. Residential developments are reducing the volume of sites that are available and there is a need to find more locations in the right regions that will meet escalating demand in specific areas.
The fragmented market
The care home market contains a wealth of different providers, many of whom only have a small investment. For example, 80% of care home providers have just one care home. As the number of places available in NHS or local authority homes reduces there may be more of a need for the market to offer a more consistent range of options.
Care homes in the UK can be profitable – revenue for the sector increases significantly year on year. However, in construction terms, the industry currently faces some significant challenges that need to be overcome if the opportunities that exist are to be capitalised on.
