Old people should be seen and not heard – or not seen at all?
There is a ‘tsunami’ heading Australia’s way as our aging population creates unprecedented demand for alternative living arrangements and accommodation for the over 60s.
In line with ageing population trends, and in keeping with a tendency for people to work longer, the age at which individuals are looking to move into the various phases of retirement has pushed out by around 10 years. Retirement living now sits at 60 years plus, independent living at 70 years plus and aged care (nursing homes) at 80 years plus.
Turning briefly to each of these sectors, the retirement sector has seen a trend emerge towards developing high quality over 60s villages and gated communities. Across Australia, developers are focussing on delivering high quality communities with strong lifestyle appeal including sporting facilities, gyms, yoga and Pilates as a part of their offering. And while all of this sounds lovely – it comes at a cost. For more and more people, the costs can be prohibitive.
And one of the reasons?
Acquiring suitable land is a major challenge particularly within the larger urban centres where it is questionable as to whether aged care or retirement living provides the best return on the use of that land.
For developers, it is a numbers game.
Given that the public and not for profit sectors aren’t about to challenge the private sector in delivery of housing, retirement villages and aged care options to meet the growing demand of older Australians, government – at all levels – needs to do more. This means developing planning policies that incentivise retirement living as part of their infill programs. More on that later though.
Another trend emerging in the retirement sector is the growing acceptance and demand towards multi storey developments that retain the lifestyle attributes afforded by other retirement offerings. This offers prospective retirees the opportunity to continue to reside within the catchment of their family home. Whilst the eastern seaboard has embraced this type of living for some time, I suspect Western Australia will see increasing activity in this area going forward.
The independent living sector has seen the emergence of providers delivering a retirement village setting complemented by the provision of community or homecare packages. These allow the residents to remain in their home and receive care and assistance on an hourly basis as their care needs dictate. Given the degree of regulatory framework in the aged care sector, such providers are ‘aged care’ providers without the compliance costs or a 24/7 medical care service. Needless to say, this sector continues to grow as many residents can’t afford to relocate or downsize for fear of losing part or all of their pension or just simply want the option of staying in their home for longer.
The third sector is ‘true’ aged care, which is comprised of providers that are approved by the Australian Federal Government and receive around 75% of their operational income from the government. The residents in aged care require 24/7 care and the service provided is generally an end of life offering.
As of June 2016 there were 2,877 aged care services across Australia with a total of 199,499 beds (Source: Department of Health). It is estimated that over the next ten years, a further 77,000 beds will be required in the sector. At an average facility size of 100 beds and an average cost to build of $30 million, this will require an investment in the sector of over $23 billion.
The challenges for the sector are finding land in the areas where demand is strongest, and generating the capital required to build the facilities.
Where this leaves our ageing population is anyone’s guess. But unequivocally we need policy, funding and community support to ensure the older members of society have options and dignity. Which brings me to the end of this article, and the beginning of the next one – see you next week.