Retire in style and safety

Developers have spotted a big new market - homes designed for our ageing population

"We didn't want to get up one day and think, 'We have to move.' By doing it now, we have capitalised on our free time," Joan says.

They are not alone. As the numbers of elderly have grown - 10.8 million Britons are 65 or over, and 1.1 million people are aged 85-plus, say government figures - so have their relative wealth, thanks to soaring house prices in the past 30 years.

Enter the property developer, creating a new "retirement home" sector. More than 125,000 people live in private houses and flats built specifically for the over-55s, says Retirement Homesearch, a consultancy.

"Retirement property" may be a new idea but, rather like its clients, it is maturing. It now falls into three categories.

First, there are the medium-sized developments of between 10 and 40 standard houses or flats with discreet internal modifications such as wider corridors, waist-level power points for wheelchair-users, more handrails in bathrooms and eye-level kitchen appliances. There may be a warden within the estate, but he or she is strictly reactive - in other words, playing a role in the lives of the residents only when asked.

This category targets "young retireds", where both partners are physically and mentally independent. "Our developments don't offer communal dining or reception areas. Most buyers want to stay in charge of their lives without interference. The emphasis is on independence, with the availability of on-site assistance rather than communal living," says Kevin Holland of English Courtyard (0800 220 858), which has built 800 homes.

This category represents the shape of retirement housing to come - high-quality, high-price properties in some of Britain's more up-market locations, with facilities such as managed guest suites in the development that can be hired when visitors come to stay.

The second category consists of more specialist developments, often for older, less independent buyers, which can have as many as 150 homes.

These have similarly equipped properties but with a larger proportion of small, single-person flats. On-site facilities are more extensive and can include doctors' surgeries, shops and even hair stylists or community halls.

In theory, they are modelled on the communal lifestyle seen in the so-called "super sunshine estates" of up to 5,000 houses each in the US and Australia. But British planning laws prohibit low-density developments of this kind, because land shortages mean that local authorities want higher numbers to be housed in developments.

The Care Village Group (01225 865 555) is one of Britain's leading developers in the field. It has four such villages in the west Cotswolds and one in Kent. Britain's best-known retirement developer, McCarthy & Stone, has 60 per cent of the market and builds some estates with "extra care" and some for independent buyers (0500 870 454).

But not all older people, even those sitting on appreciating properties bought and lived in through their working lives, can afford specialist retirement houses or flats. So the third category consists of lower-cost schemes such as that promoted by Economic Lifestyle, a retirement consultancy offering "lifetime tenancies".

Economic Lifestyle (08450 676 665) buys McCarthy & Stone flats when the owners die, then leases them for a large one-off sum to customers aged over 65, who live in them for the rest of their lives. Buyers are charged about 55 per cent of the market value of the properties and pay service charges and running costs.

"As they've probably traded down from a bigger home, they'll have released equity to improve their lives," says the firm's operations manager, Mark Neal.

So far so good, but when a resident dies the property then reverts in its entirety to Economic Lifestyle, so there is no home or equity to be left to relatives. Its appreciation during the owner's life goes to the company, too, making it a bricks-and-mortar version of equity release - beneficial to owners, perhaps, but not always popular with those left behind after they have died.

Whatever the merits of one type scheme over another, there is little doubt that demand is set to soar. There will be 11.9 million pensioners by 2011 and 16.1 million by 2040, with life expectancy predicted to rise from today's 75.5 years for men and 80.3 for women to 80.3 and 83.2 years respectively by 2025. An older population is here to stay - and so is their need for places to live.

Tips

Whichever category you choose, watch out for:
Service charges; some communities have gardens and special facilities; overheads can be steep.
Resale values and rights; ask about these, especially in established developments. Properties often have restrictions on who they can be sold on to.
If you buy into a village, check on levies payable to the management if the property is sold at a profit.
Ensure the development is registered with the Association of Retirement Housing Managers (www.arhm.org; 020-7463 0660).
Help and advice from www.housingcare.org