New care home developments 'financially driven' and do not reflect regional demand

We are seeing a continuing growth in new care home developments being built, however these are very much “financially driven” and are not in the areas where they are really needed, according to a social care property adviser.

HPC (Healthcare Property Consultants Ltd) has carried out new research which found that although new care homes are being built, these do not compensate for the care homes that are closing.

It is the north of the UK which is feeling the strain, with a notable drop in care home beds, as opposed to the south which has seen a veritable gain.

Nigel Newton Taylor, director of HPC, underlined how economic factors continue to impact upon the pattern of care home development, saying: “The data clearly identifies new development to be financially driven, rather than reflecting regional demand.

“There continues to be an overwhelming operating appetite for the more affluent self-fund market in the south of the country in order to minimise operational risk resulting from inadequate local authority fee levels.”

The research, undertaken between 1 April 2011 and 30 September 2014, analysed registration data held by the Care Quality Commission.

Bed numbers, in terms of closed facilities and new developments, are extremely consistent throughout the period. Net loss and gain has fluctuated, with the cumulative outcome being a marginal net bed gain.

In terms of care home, rather than bed numbers, the annual number of newly opened homes for the elderly is marginally in excess of 100 with the corresponding closure figure being approximately 200.

As the proportion of facilities provided by the larger care home operators increases annually, 2014 saw established care home providers such as Care UK and Maria Mallaband Care Group invest significantly in new development.

However in the same 12 month period, well over a dozen local authorities have closed care homes with the buildings becoming too expensive to maintain and the comparatively high cost of in-house care provision becoming increasingly unaffordable.

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