Retirement villages

Forget dated notions of sheltered housing for OAPs. Now it's all about having an active retirement, and what better place to do it than the new retirement villages?

The new ageing

Demographics are clear. There are now more people over the age of 65 than under the age of 16 in the UK, and soon 25 per cent of the population will be over retirement age.

But being old enough to draw your pension may actually be something to look forward to. Because, according to the providers of the new ‘retirement villages', OAPs are growing old gracefully, and now form a discerning, and wealthy group which is reshaping the traditional notions of old age.

"The population is changing very quickly. People are living longer and are more prosperous," says Nick Sanderson, chairman of the Association of Retirement Village Operators UK (ARVOUK).

"The over-60s now have 80 per cent of the nation's wealth. They own a trillion pounds' worth of property, most of which has no mortgage."

Given this financial independence and improved health and quality of life, it is hardly surprising that only 10 per cent of elderly people are turning to the traditional British model of sheltered housing or care homes.

Village people

Increasingly, those that can are buying into the type of retirement ‘villages' favoured in the States, South Africa, Australia and New Zealand.

"The new generation are much more demanding," says Nick. "An 80-year-old now has probably travelled the world and eaten in fine restaurants. And they want to see good quality individual living.

"At the moment it's a small market, but retirement villages are going to be the largest growth area in housing in the UK. New Zealand has three times as many retirement villages as the UK with a population of one tenth the size."

And, to emphasise the growing need, Nick gives his favourite statistic.

"In the year of the coronation, the Queen sent out less than 100 telegrams. This year it will be 9,000 and by 2020 there will be 40,000. The numbers are staggering."

The providers

Although the sector remains small, there are said to be some 70 companies providing some type of retirement developments.

Many of these schemes are built and run by the developer, while others, such as Churchill Retirement, are constructed then handed over to specialist management companies who are responsible for security, maintenance (although residents look after their own property internally), provision of an on-site manager, and emergency back-up to residents.

Facilities usually include a communal lounge, maintained gardens, a laundry and a guest suite where relatives can stay for a fee.

At a higher price come developments such as those by Audley Retirement, Richmond Villages and Retirement Villages, which create whole self-contained ‘villages' with more of a country-club ambiance.

For those of more modest means there are some good operators in the not for profit sector, including Joseph Rowntree, Anchor and ExtraCare Charitable Trust.

Although most schemes are new build, this is not always the case. At the top end you could, for example, expect to live within the grounds of a former country house.

Inglewood, a new development in Berkshire from luxury provider Audley Retirement, was formerly a Champneys spa. But in its new incarnation, the inhabitants of the nine cottages and 87 apartments will benefit from a well-being centre, library, swimming pool, hairdressing salon and bistro.

And for cricket fans, the new Pegasus development with views over the Taunton home of the Somerset Cricket Club will take some beating.

The pros

According to ARVOUK, the retirement village model works because it provides members with the three main requirements for a happy, active retirement:

  • Housing – the comfort, rights, security and privacy that comes with owning their own home.
  • Community – through organised events and activities, and shared facilities such as swimming pools and restaurants.
  • Access to care – if and when required, and ready to adapt to residents' changing needs.

The cons

  • Service charges – retirement housing is leasehold (albeit on very long leases) with a ground rent payable to the freeholder. But service charges can be high (often £2-3,000 a year), and some residents have had issues with recent increases.
  • Resale – these properties are generally thought to be a sound investment. However, you may be restricted in who you can sell to, and some companies do charge fees when a property is sold.
  • Loss of personal space – for example, although most developments are set in beautiful, often extensive grounds, for a keen gardener losing their individual plots can be a wrench.

The future

The minimum age for retirement villages is usually 55, but as many of us can expect to live a long and healthy life into our 80s and beyond, the housing is specifically designed with changing needs in mind.

"Unless they get a very specialist condition, such as dementia, most people stay in their homes," says Nick Sanderson. "Their property can adapt as their needs change, so can the service."

But, stresses Nick, simply by living in a retirement village, you may actually decrease your chances of becoming infirm.

As well as offering health promotion initiatives, the exercise facilities and social interactions provide the ideal environment for a continuing active retirement.

"A huge advantage of this is that people keep physically and socially active, and their bodies and brains will keep working. It's been medically proven - it's use it or lose it," says Nick.

The finances

Chief executive of Retirement Villages Ltd, Jon Gooding, says, "For our customers, the decision to move is partly aspirational and partly needs-driven.

"Our purchasers are typically downsizing and releasing substantial equity from the sale of their property, which is usually unmortgaged."

However, there is still the service charge to factor in, so equity release, where residents sell part of their new home, is becoming an increasingly popular option.

The grandchildren

One myth about retirement developments is that they're a gated ghetto, unwelcoming to family and friends.

"If you visit one of our member villages on a Sunday you will see it's full of families," says Nick.

"The kids will have a swim and then have lunch with their grandparents. It's not shut off at all. Older people fear they'll end up alone. But it just doesn't happen here."