09 February Housing Strategy Team Welsh Government Rhydycar Business Park Merthyr Tydfil, CF48 1UZ. Dear Sir/Madam

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1 09 February 2012 Housing Strategy Team Welsh Government Rhydycar Business Park Merthyr Tydfil, CF48 1UZ Dear Sir/Madam Re: Older people s housing and a new Housing Bill for Wales Thank you for the opportunity to comment on Meeting the Housing Challenge: Building a consensus for action, ahead of the publication of a new Housing Bill for Wales this spring. Although we are pleased to see the Welsh Government review its housing policies, we are disappointed that the consultation document omits any reference to the need to increase the delivery of specialist housing for one of the most vulnerable sections of our society: older people. As the largest provider of accommodation and care for older people in the UK, we would be pleased to meet with the Housing Strategy Team to review and consider the options around how best to deliver more and better housing for older people in Wales. Specialist housing for older owner-occupiers of the type that we provide has a number of benefits, including greater well-being and improved health for its residents. Importantly, its development also frees up much-needed and under-occupied larger family-sized housing. This has a knock on effect that stimulates the housing chain and ultimately benefits the first time buyer through greater housing availability. Given Wales s rapidly ageing population and its historic under-supply of specialist housing for the elderly, we are keen that this housing review looks seriously at older people s housing and ensures that policies are in place to encourage its delivery. Introduction 1. McCarthy & Stone provides approximately 70% of all owner-occupied retirement and Extra Care accommodation for older people in the UK. To date, we have built more than 40,000 dwellings across 1,000 different schemes (in 2010/11, we built 1,300 dwellings), including many in Wales. 2. We have two scheme types: i. Retirement Living (since 1977) Similar to traditional Category Two type sheltered housing, but to Lifetime Homes Standards. It includes a House Manager, lounge, communal laundry, CCTV, camera entry system, guest suite and lifts to all floors. Residents have active, independent lifestyles in a safe but private environment. The average resident age is approximately 78. ii. Extra Care (since 2000) We have 42 Assisted Living schemes, either open or in planning, making us the largest Extra Care provider in the UK. These dwellings are as above but are designed to full wheelchair housing standards and widths, and include more services such as 24-hour attendance, a restaurant, lounge and one hour per week of domestic assistance, with care packages available. The average age is approximately 83. Schemes are managed by a CQC-registered joint venture between McCarthy & Stone and Somerset Care. 1

2 The ageing population in Wales 3. We are keen for the review of housing policy in Wales to reference and acknowledge the need for a greater supply of housing choices for older people given both the rapidly ageing population and the benefits that specialist housing offers those in later life. 4. We believe that older people should be one of the main focuses in Welsh housing policy. The number of people aged 65 and over in Wales is projected to increase by around 306,000, or 55 per cent, between 2010 and As life expectancy at age 65 is now 18 years for men and 20 years for women, it is important that local authorities look to ensure that older people are supplied with appropriate housing choices. 1 It is also worth noting that Wales has a higher proportion of home owners (at 72%) than any other part of the UK However, across Wales and the UK, there is a shortage of appropriate housing for those in later life. The number of older people across the UK totals nearly 11 million, but there are just 106,000 specialist owner-occupied homes available for older people (there are no specific figures for Wales available). Both Wales and the UK as a whole are building far fewer specialist homes for older people now than in the 1980s, and each year of low building rates intensifies the situation. 6. As there are so few specialist homes available, the choice is restricted when older people feel the need to move into accommodation that better suits their needs, perhaps because of declining health, the need for care or the loss of a loved one. There is a lack of appropriate rented accommodation for those in the social-rented sector, and those who own their own property can either sell up and move into an often expensive residential care home, or soldier on in their existing property. This is no choice at all This has numerous implications. Not only is unsuitable housing bad for physical health, it also effects the mental health of an older person through the creation of feelings of isolation and loneliness. It also has a huge impact on the public purse. Housing is a major determinate of health, and half of NHS spending is on older people. The annual cost of falls among older people is 1 billion each year and almost two thirds of general and acute hospital beds are occupied by people aged over Unsuitable housing also increases the pressure on adult residential care budgets. Estimates show that public spending on social care will need to triple over the next 20 years to keep pace with the ageing population, and a major part of this is because older people are unable to continue managing in their own home and are forced into care homes. 9. Social change means there is a pressing need to build more new homes, especially homes that meet the needs of older people. Altering family structures mean it is now more difficult for the elderly to be cared for by younger generations. There is also a higher proportion of single-person households. These factors have a huge impact on housing demand. Changes like these would be manageable if enough of the right kind of homes were being built. 1 Office of National Statistics, Life expectancy at birth, CML, Home Ownership in Wales, Issues and Challenges, HAPPI Housing our ageing population: Panel for Innovation, P14,

3 10. Conversely, housing wealth is also becoming concentrated among this older age group, and the number and wealth of older households is growing at a fast rate. Across the UK, people aged over 65 own more than 1.1 trillion of equity in their homes. 4 Many of these households are under-occupying two thirds of the 4.1 million under-occupying households are aged between 50 and Within Wales, total housing wealth is estimated at 171 billion 6, with at least a quarter of this likely to be held by the over 65s. 11. However, housing wealth does not mean better living conditions, with many older people being equity rich but cash poor and living in conditions unsuited to their situation. It is becoming increasingly important to provide housing choices that allow older people to downsize and access their housing equity, which in turn increases the availability of larger homes for younger families. 12. While there is a lack of specialist housing across all tenures, the situation is particularly worrying in the owner-occupied sector. As 72% of older people own their own property in Wales, there is a pressing need to provide appropriate housing choices for owneroccupiers to downsize to in later life. The consultation document Meeting the Housing Challenge: Building a consensus for action notes that the private sector is a key player in housing in Wales. However, the country does not yet have the right policy stimulus to allow this sector to address the chronic shortage of appropriate housing solutions for older people who wish to downsize and continue to own their own home. Benefits of specialist housing for older people 13. A number of reports have been published recently outlining the benefits of specialist accommodation for older people. A 2011 report by the University of Reading noted that because of the substantial benefits that this form of housing provides for older people, more should be done to increase its supply. 7 The report supported many of the findings noted in the HAPPI (Housing our Ageing Population) Panel report, published in The University of Reading s report notes the following benefits of specialist housing for older people: a. Boosts local housing. Owner-occupied retirement housing increases availability of much-needed family housing in areas of shortage. On moving, most residents free up substantial family homes, with two thirds moving from homes with three or more bedrooms to an apartment of one or two bedrooms. 5,000 purchases of McCarthy & Stone properties between 2007 and 2010 freed up housing worth 1.1 billion. The majority of these homes were located in the local market area. It therefore helps moderate local house price growth and can reduce demand for building new, larger properties. b. A higher quality of life for older people. Retirement housing allows people to maintain their independence. 92% of residents are very happy or contented. In addition, the Better Life report 9 showed that 41% of residents felt their health had improved since moving. 64% felt that their sense of wellbeing had improved. By purchasing a leasehold specialist apartment, 4 The Financial Inclusion Centre, Intergenerational Foundation, Hoarding of Housing: Fairness for Future Generations, October Halifax, Press Release: Welsh Private Housing Stock valued at 171 billion in 2007, 12 January Housing markets and independence in old age: expanding the opportunities, University of Reading, May Housing our Ageing Population: Panel for Innovation, A Better Life, Private Sheltered Housing and Independent Living for Older People, Opinion Research Bureau,

4 residents have a smaller household to maintain, and buildings and gardens maintenance is organised and paid for through a set service charge. c. Energy efficiency. 51% have energy bills that are noticeably less. d. Private rather than public provision. Owner-occupied retirement housing entails no cost to the public purse and is delivered by private providers. It is funded by the purchaser using the equity built up in their previous home. e. Part of the community. The elderly are essential to the health of a local community. Most residents have family and friends in the locality. 99% of respondents families were supportive of their parents move. Specialist housing sustains local shopping and other services. 80% of residents use the shops almost daily or often; over 40% use the library or post office almost daily or often. f. Reduces demand on public sector resources. Older people have a large impact on NHS resources, yet private retirement residents manage better and spend fewer nights in hospital as accommodation is designed better to cope with their needs (nights in hospital are noted as being one of the most expensive items of health care for the elderly). 28% of residents said they could manage better, 65% said they managed the same in specialist housing. 60% said they found it easier to return home following a stay in hospital. Research also suggests that specialist accommodation for older people can prolong the period between people needing to move into residential care, which again reduces the pressure on social services. g. Allows for equity release. Dwellings bought were 10% cheaper than the properties sold, resulting in a significant amount of equity release. About 40% were able to withdraw 25,000 or more. 15. The likelihood is that limited public subsidy will be available in the future to deliver new Extra Care or retirement housing. Therefore the owner-occupied sector is well-placed to increase supply. National policy context 16. The need to consider the needs of older people are noted (albeit very briefly) in current Welsh housing and planning policy. Planning Policy Wales notes on P20 that local authorities need to plan for demographic change, and that local policies need to have regard to their likely impact on the elderly. 10 The national Housing Strategy for Wales also notes the need to provide more housing of the right type for older people and offer greater choice. 11 Indeed, P6 of the document notes that: Most housing is built by the private sector, for sale or rent, with no financial input from the Assembly Government. The role of developers is critical to the continuing supply of quality homes and supports thousands of jobs in construction and related industries. They can make a major contribution to tackling the huge challenges such as climate change and an ageing society, while at the same time creating jobs and supporting local businesses. 10 Planning Policy Wales, Edition 4, February Improving Lives and Communities, Homes in Wales, April

5 17. Page 17 of the National Welsh Housing Strategy adds that the Assembly is looking to Develop more ways of meeting the housing needs of an ageing society, enabling people to live independently for as long as possible in their own homes and, where necessary, providing quality care and support. 18. However, it is our view that any review of housing and planning policy should look at stepping up the requirement to plan for better housing for older people. Each year, the chronic shortage of adequate housing for the elderly gets worse, and it is time for a step change in national policy. Given the current shortage, existing policy in this area has not proved adequate. 19. It is also worth noting the direction of travel of housing policy in England. The Westminster Government is committed to creating a policy environment that increases supply of older people s housing to deal with its ageing demographic. This is evidenced in DCLG s Housing Strategy, published in November Page 47 states: We will encourage local authorities to make provision for a wide range of housing types across all tenures, including accessible and adaptable general-needs retirement housing, and specialised housing options including sheltered and Extra Care housing for older people with support and care needs. The Housing Strategy also notes that DCLG is working with providers to produce a best practise guide to help local authorities increase delivery, and we are pleased to be leading this technical working group with the Department. 20. In addition, the Dilnot Commission s Report in July 2011, which looked into funding models for adult social care, highlighted that specialist retirement housing, including models such as Extra Care, could be one answer to the challenge of providing support and assistance for the elderly. It states on P61 that:...sometimes more appropriate housing could bring significant benefits some may find that downsizing or moving to a more suitable type of accommodation could improve their health and overall welfare. We want people to start planning earlier because this will allow them to exercise far greater control than if they wait until they develop a significant care and support need or face distressing and critical circumstances. For example, the Commission hopes that more people will be able to consider Extra Care housing in the future, if they are more aware of this type of provision and can be more certain over their financial planning. Recommendations 21. We make the following requests for the new Housing Bill for Wales: a. Make planning for demographic change the core objective of the new Housing Bill. Given the importance of the changing nature of the population, the increasing numbers of older people and the positive personal and public benefits of specialist housing for older people, the need to plan for demographic change and better housing provision for older people should be included as one of the strategic principles of the new Welsh Housing Bill. It is difficult to contemplate a more sustainable form of housing than that of well designed and located accommodation for older people, which also helps to address many of the impacts of our ageing population. To achieve this, we would like to see local authorities view positively planning applications that seek to address the changing nature of Wales demographics, such as specialist homes for older people, particularly those delivered for owner-occupation. We note and agree with the consultation document s comment on page 9 that home ownership is the aspiration of most people, and older people 5

6 are no different few will wish to move into social housing at this stage of their lives. Therefore it is important that consideration is given to specialist housing across all tenures to encourage its delivery and downsizing. b. Strengthen the links between housing, planning and health. It is our view that housing policy needs to show a strong link between better accommodation and improved health for older people given the weight of evidence that notes how they are connected. To achieve this, local authorities should be asked to view positively those planning applications that deliver social and health benefits to local residents, particularly for families, the elderly and the disabled. c. Strengthen the requirement to undertake robust housing assessments. Housing policies place great weight on ensuring that local authorities have the correct evidence base to inform their housing and planning strategies. However, these housing assessments vary greatly from authority to authority and in our experience they are often deficient. Many look at the housing needs of younger people / first time buyers, families and those in the social rented sector, but few plan for housing provision for older people, particularly in the private sector. As a result, few local plans or housing strategies plan for older people s housing at all (for instance, Cardiff s Draft Housing Strategy published in January 2012, does not include one mention of building new homes for older people, despite a 25% projected increase in its older person population over the next 20 years). It is therefore vital to strengthen and clarify the requirements on local authorities to undertake robust assessments in order to ensure the delivery of more specialist housing for older people across all tenures. d. Role of Windfall sites. We would like to see specific policies that encourage the development of windfall sites in Wales for older people. As most sites that come forward for specialist retirement accommodation are classified as windfall development (suitable sites can be old large detached properties, redundant garages or old hotels / public houses) they do not feature as allocated sites in local plans. The success of these schemes is also hugely dependent on location, where they need to be close to transport links, local amenities and town centres. These sites are the hardest to come by, and hence they need encouragement in local policies to ensure they are delivered. e. Delays in starting construction. A growing concern is the increased delays caused by local authorities in not completing the S106 obligation or discharging planning conditions in a timely manner, which is required in order for construction work to commence. Across the UK, we are experiencing delays in starting construction on 15 Extra Care and retirement schemes totalling 700 individual homes and 800 jobs. We feel it is important that the review makes reference to S106 agreements and planning conditions and the need for local authorities to progress them quickly once the initial resolution to grant planning consent has been provided. f. Evaluating the impact of S106 and affordable housing policies. This would look at how S106 and affordable housing requirements on specialist housing restrict delivery. The University of Reading has recommended that specialist housing for older owner-occupiers be considered equal to affordable housing and Page 103 of the Centre for Social Justice s report Age of Opportunity, published last July, includes a recommendation for a pilot scheme that lifts the affordable housing requirement on new schemes for specialist housing for older people in order to assess its impact and encourage new providers into this market. This would help to address the issue of supply and we would support such a pilot. 6

7 g. Building regulations: Specialist housing for older people faces a high regulatory burden. 12 These burdens, of course, cover the provision of housing for the elderly as much as any other type of new housing, and do so across all tenures. However, there are specific factors that add costs to this type of home. For instance, we are awarded points under the Code for Sustainable Homes for providing home offices and cycle storage in new schemes to reduce travelling to and from work. Our residents are on average years old and will usually neither work nor cycle. Multiplied over many regulations, the impact of policies like these provide a major hindrance to development of new housing schemes for older people. We have prepared a summary note on how the catch all requirements of how building regulations impact negatively on the delivery of specialist accommodation and we would be happy to share this with the Housing Strategy Team in Wales. 22. In conclusion, we are pleased to have the opportunity to comment before the publication of the Housing Bill but we are concerned about the omission of references to specialist housing for older people, including its benefits and the need to increase its delivery. We hope the information in this submission provides some useful recommendations as to how the Bill can address this and we would be pleased to meet with you to discuss these matters further. Yours faithfully Paul Teverson Head of Public Affairs McCarthy & Stone paul.teverson@mccarthyandstone.co.uk 12 M. Ball The Housebuilding Industry. Promoting Recovery in Housing Supply, Dept. Communities and Local Government,