Occupancy levels in private care homes have returned to pre-pandemic levels, according to the latest survey from Knight Frank, which expects the sector to see increased investor activity as a result.
The firm’s 2024 Healthcare Trading Performance Report put average UK occupancy levels at 88% this year, which is up 2% on 2023 and the highest since 2019. In 2020, the figure dropped to 79%.
Knight Frank also said average weekly fees have increased by 11% year-on-year to £1,182, fuelled by a shortage of beds. This shortage, it said, is particularly severe within dementia care.
The research also found 63% of residents in private care homes are aged 85 or above, compared to 46% in state-funded facilities, reflecting the wealth profile of this demographic and the need for specialist care.
Knight Frank surveyed 80% of the UK’s corporate care market, representing more than 100,000 beds across 781 town and cities.
It found the North East had the highest proportion of care home residents in private care, with year-on-year occupancy increases highest in Northern Ireland and Wales.
Knight Frank partner and global head of healthcare Julian Evans said: “The healthcare sector’s performance has continued to reflect its robust underlying growth fundamentals, with an ageing population creating supply side pressures for good quality single-bed facilities across the UK.
“Growing occupancy and property income levels have coincided with inflationary pressures moderating, which means that higher volumes of capital will target opportunities within a sector facing a shortage of quality stock. Despite headwinds in recent years, which have led to higher operating costs, quality care homes in areas with the right demographic profile continue to operate with remarkable resilience, given they meet an essential societal requirement.”
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