Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Written Evidence


Memorandum by Age Concern England (ACE) (AH 87)

1.  INTRODUCTION

  1.1  Age Concern England (the National Council on Ageing) brings together Age Concern organisations working at a local level and 100 national bodies, including charities, professional bodies and representational groups with an interest in older people and ageing issues. Through our national information line, which receives 225,000 telephone and postal enquiries a year, and the information services offered by local Age Concern organisations, we are in day to day contact with older people and their concerns.

  1.2.  Age Concern England (ACE) is pleased to be able to contribute to the ODPM Select Committee Inquiry on Affordability and the Supply of Housing. Since the majority of older people wish to live in general rather than specialised housing[170] the supply of affordable housing is very relevant to older people.

  1.3  Given the challenges presented by an ageing population[171] and the importance of housing to independence and well-being, ACE is concerned with the housing needs of the older people of tomorrow as well as today. This submission therefore reflects the experience of older people and the likely impact of current housing policies on future generations of older people.

2.  SUMMARY

  2.1  ACE's submission emphasises the relevance of affordability and supply of housing to older people—the vast majority of whom are homeowners.

  2.2  Our key concerns in relation to some of these may be summarised as:

    —  The costs associated with owning and maintaining a home on a fixed income (see mainly paragraphs 4.6-4.8 and 5.4-5.6).

    —  The complex housing needs of older people and the need to offer maximum housing choice (see section 3 and paragraphs 4.9, 6.2 and 7.4).

    —  The needs of an ageing population and the specific planning this requires (see section 7).

  2.3  We argue that the costs and benefits of homeownership are that:

    —  Homeownership brings financial security, flexibility and security of tenure to many older people.

    —  However it is not necessarily a guarantee of wealth. We point to the difficulties that some older people on low incomes have in trying to maintain and repair their home.

    —  Releasing equity is an option to increase income in retirement but is only appropriate in certain circumstances.

  2.4  We emphasise the importance of choice and housing options for older people:

    —  There is insufficient appreciation of the housing needs and aspirations of older people and this has led to a lack of choice for this sizeable, including those in large unmanageable properties considering whether to "stay put" or "move on".

    —  Regional disparities can make it difficult for older people who wish to move to be nearer friends and family or to suitable locations for their retirement.

    —  Promotion of homeownership should not result in the neglect of the rest of the housing sector.

    —  Lack of choice—which causes some older people to remain in unsuitable housing—coupled with an ageing population, could have significant implications for society at large. The impact could be evident in the housing market in the future (in terms of the availability of homes suitable for families for example) as well as health and social care.

  2.5  Finally we argue that effective planning means:

    —  The housing needs and aspirations of older people now and in the future must be identified and responded to in national, regional and local housing strategies.

    —  The planning system needs to take into account the type of accommodation that is needed, the physical design and the community infrastructure.

    —  Older people need to be engaged in planning housing developments from the outset.

3.  GENERAL COMMENTS

Housing needs of older people

  3.1  There are specific issues to consider with regard to housing for older people. These are relevant to the future of housing policy because they demonstrate the need for careful future planning, the importance of the home and the socio-economic benefits that successful housing for older people can have. An inability to address these needs could influence the housing market.

  3.2  Older people spend between 70-90% of their time in the home[172] so its role in well-being is key.

  3.3  Suitable housing stock is at the heart of ensuring that people can be supported to live at home in greater numbers, especially in terms of housing condition and adaptability[173].

  3.4  Older people are a hugely diverse group with wide-ranging needs—requiring appropriate mainstream housing as well as more specialist provision, such as retirement housing or accommodation suitable for the most frail older people (such as those with complex and multiple disabilities).

  3.5  Mobility often decreases with age, as can the ability to manage a large home, and many older people will at some stage need to consider whether to "stay put" or "move on".

  3.6  There is a deficit of adapted homes or homes capable of being adapted and the current system for adaptations is means-tested, bureaucratic and lengthy.

  3.7  Some older people would prefer to remain in their existing home—although the decision to remain at home may sometimes be due to a lack of alternative choice[174].

  3.8  A wide range of options, including mainstream and specialised housing, is therefore required to help older people make a successful transition from their existing home—if this is their preferred choice.

  3.9  The vast majority of older people are homeowners and the proportion of older homeowners is set to rise further, partly as there are more homeowners amongst younger age groups. For example, in 2001 nearly 82% of people aged 55-59 owned their home.[175]

  3.10  Future generations of older people may have different and higher expectations of their housing than today's generation.

Public policy on ageing

  3.11  Housing, and the challenge of an ageing population, is beginning to be recognised as a key issue. For example, the Government's strategy on ageing, Opportunity Age,[176] recognises that "mainstream housing policy needs to reflect the issues that an ageing population raises", and we look forward to action resulting from this plan.

  3.12 Yet a recent report by the Housing and Older People Development Group (HOPDEV)—a joint ODPM/DH advisory group—advised that "despite forming a significant and growing proportion of all households, older people's housing aspirations can still be all too easily overlooked".[177]

4.  POTENTIAL BENEFITS OF AND SCOPE TO PROMOTE HOME OWNERSHIP

Potential benefits of homeownership

  4.1  The main benefit of owning one's own home is the sense of security and flexibility it may bring—both financially and in terms of security of tenure.

  4.2  Indeed, higher disposable incomes in retirement are likely to be associated with homeownership. In part this is because those with higher lifetime earnings will be more likely to have purchased their home and will tend also to have better pension provision. In addition, regular outgoings will tend to be lower for homeowners who do not have to pay rent. For example, research commissioned by Age Concern found the weekly incomes necessary to achieve a "modest but adequate" standard of living in retirement was around £40 a week higher for a single tenant than for a homeowner.[178] There are still homeowners in poverty although the rates, after paying housing costs, are lower than among tenants. Among pensioners 15% of those who own their home outright are in poverty, compared to 30% of social housing tenants and 44% of private tenants.[179]

  4.3  Equity release may also be an option available to some homeowners—either to release a lump sum for home improvements or other major expenses, or to provide a regular monthly income.

  4.4  Security of tenure is another benefit—but this is dependent on the stability of the housing market and people not assuming unsustainable financial commitments.

Concerns on homeownership

  4.5  Housing equity is being suggested as a way to fund needs such as care, adaptations and pensions in later life. The Pensions Commission[180] notes that housing assets are considerable (more than £2,250 billion net of mortgage debt) and a significant proportion of people see these as an alternative or additional retirement asset. However the Commission's analysis suggests that this will not provide a solution to pension problems due to uncertainty over house prices, the fact that housing wealth is not significantly higher among those with least pension rights and other potential claims on housing wealth such as long-term care.

  4.6  Housing equity has also been suggested as a way of meeting other costs including repairs and council tax. While equity can play a role for some older people there is a limit to how far this can stretch. Furthermore, some older homeowners have little or no equity because they live in a deprived area while partial homeownership, through HomeBuy for example, does not bring the same level of homeownership benefit.

  4.7  Homeownership brings with it a clear responsibility and we have heard from older people who have come to view their home as a burden, especially as state assistance, such as help with repairs, to homeowners has decreased over the years.[181]

Promotion of homeownership

  4.8  If the general expectation is that it is "right to buy, wrong to rent" then we are very concerned that this could give rise to people assuming excessive debt and taking these debts into retirement.

  4.9  Our view is that the promotion of homeownership must not result in the neglect of the rest of the housing sector and that a range of choices must be made available to those who cannot or do not wish to buy—or to homeowners needing to leave the housing market for a variety of reasons For example, it can be very difficult for some people to make the move from homeownership into social rented if they cannot afford to rent privately. This is because some local authorities do not house homeowners or only offer limited options, sheltered housing for instance, to older people.

5.  EXTENT TO WHICH HOME PURCHASE TACKLES SOCIAL AND ECONOMIC INEQUALITIES AND REDUCES POVERTY

Social and economic inequality

  5.1  The Right To Buy (RTB) encouraged many tenants to buy properties in low-cost areas that in some cases were not saleable on the open market and often came with large communal repairs obligations. A sizeable number of those who purchased flats through RTB are older people and they face significant problems in paying major works bills and service charge bills on a fixed income.

  5.2  We believe there is a danger that, in a bid to become a homeowner, some will buy cheaper or poorer quality properties simply to enter the housing market and then have limited options later on if they wish or need to move elsewhere.

Home purchase and poverty reduction

  5.3  As indicated in 3.2, home purchase may be related to greater disposable income in later life.

  5.4  However, homeowners who are on low incomes can find themselves in a worse financial position than tenants. Pension credit guarantee is generally paid at the same rate to homeowners and tenants. Council tax benefit and housing benefit can cover rent and council tax yet from the £109.45 a week benefit received older homeowners must also meet the cost of building insurance, and home maintenance and repairs. Flats as opposed to houses are becoming more common, especially in high density areas, and yet there is limited assistance with the service charges and major works costs often associated with flats. These charges pose a particular problem for retirees when increases are more than their pension increases. We understand that the new HomeBuy scheme will impose a liability on the resident for full service charges and major works—this is extremely regrettable.

  5.5  Releasing equity in a property is an option available to homeowners to improve their income but it is not suitable for all. For example those on the lowest incomes, receiving benefits such as pension credit and council tax benefit, may find that releasing income or capital simply reduces or stops the benefits being paid.

  5.6  Older householders are often unable to maintain their homes and many live in poor quality accommodation as a result. Older homeowners who have been resident for 30 years or more in their current homes are one of the groups most likely to live in a non-decent home, as are those on a low income in the private sector.[182]

6.  ECONOMIC AND SOCIAL IMPACT OF CURRENT HOUSE PRICES

  6.1  Increases in house prices over time is of course a major benefit for many homeowners but for some older people this has been a mixed blessing as it has led to high council tax bills. Those who many years ago bought what was then an affordable home in a low cost area may now find they live in an area of high demand where prices have increased disproportionately. While they do not want to leave an area where they have family and friends they are facing high council tax demands which must be met from modest fixed incomes. Age Concern has argued for a system of paying of local government finance which is more closely related to ability to pay.

  6.2  Furthermore, regional disparities in house-prices are having an impact on the housing choices available to older people. Some older people live away from friends and family due to the changing nature of family relationships and residence patterns. If they live in a low cost area and need to move to seek support from relatives living in an area of higher house prices, they may find it difficult. The trend for second homes in coastal and rural areas is also pushing up prices and preventing older people from retiring to what might be deemed traditional retiring locations. This in turn is affecting migration patterns and may be distorting the housing market.

7.  SCALE OF THE GOVERNMENT'S PLANS TO BOOST HOUSING SUPPLY

  7.1  ACE's main concern is whether the Government, in attempting to boost the supply of housing, particularly in the South-East, and reviewing the planning system, has considered adequately the particular housing challenges facing older people now and in the future.

Strategic planning

  7.2  Planners are now required to look 15 years ahead but a recent HOPDEV report advised that "a detailed insight into and understanding of the changing housing needs of older people over time is essential in order to plan to meet the housing needs and aspirations of such a diverse and large section of the population".[183]

  7.3  The housing needs and aspirations of older people—now and in the future—must be identified and responded to, in national, regional and local housing strategies and planning policies as well as local development frameworks—and importantly, linked with the raft of other health, social care and older people's strategies.

  7.4  For example, older people often find a large home difficult to manage and would like to move to a smaller property. However, it should be recognised that downsizing does not necessarily mean moving to a one-bedroom property or even a bed-sit (still the only choice in some sheltered schemes). Older people are more likely to need at least one spare room to accommodate visiting grandchildren, take up a hobby and so on. The market needs to address this, and other aspirations held by older people. At present, some older people over-occupy large properties, that would be suitable for families, because of a dearth of accommodation that meets their needs.

Physical design

  7.5  It is imperative that new homes are designed with the needs of an ageing population in mind. There is a strong correlation between reduced mobility and disability—around two thirds of disabled people are older people. Despite this, there is a glaring deficit in accessible homes. Building regulations (Part M) now require all new housing to meet minimum accessibility requirements but we would urge that a higher percentage of Lifetime Homes[184] are built as soon as possible. Although the Government has pledged to review this matter, progress has so far been slow which is regrettable given the plans to boost housing supply. Furthermore, there is also a need to increase the supply of fully-wheelchair accessible homes as there is already a deficit and the number of wheelchair users is likely to rise as the population ages.

Adequate infrastructure

  7.6  Any new developments, if they are to serve the needs of older people and future older people, must have good access to health, leisure and shopping facilities served by good, reliable transport. Those households without a car have found accessing even basic services more and more difficult and as a consequence are in danger of becoming socially excluded.

  7.7  75% of single and 25% of couple households over the age of 65 do not have a car.[185] Though the number of older drivers is increasing, the ability to walk and have easy access to public transport will continue to be an important issue for many older people since the number of trips made by car decreases with age. The Department of Transport has forecast that retired people are likely to continue to make up a disproportionate number of households with no car.[186]

Effective engagement

  7.8  Older people must be engaged in planning new housing developments from the outset, as should those approaching older age as the aspirations of older people continue to evolve.

8.  CONCLUSION

  8.1  ACE is very concerned that the housing needs of older people are properly considered in future housing and planning policies. As we have explained above, the supply of affordable housing is very relevant to older people since the vast majority of older people live in mainstream housing. The implications of not responding to this agenda, in social and economic terms, could be very serious.







170   90% of older people live in the general housing stock, 5% in residential/institutional provision and 5% live in sheltered/supported housing. The 2001 Census recorded 61% of those aged 65 and over as owning their homes outright. 76% of people aged over 55 are homeowners, and this figure continues to rise. Back

171   In 2003, 18.5% of the population was over pensionable age-around 11 million people. The number of people over pensionable age is projected to increase from 11.4 million in 2006 to 12.2 million in 2011; 13.9 million by 2026 and peaking at 15.3 million in 2031 (Population trends 118. Winter 2004. Interim 2003-based national population projections for the UK and constituent countries-C Shaw, National Statistics 2004). Back

172   Planning for Mixed Communities (ODPM, 2005). Back

173   Ibid. Back

174   A housing advice pilot by Care & Repair England demonstrated that even when older people were aware of housing options, a lack of suitable accommodation meant that housing choice was simply not a reality (Should I Stay or Should I Go? Developing Housing Options Services for Older People, Care & Repair England, 2003). Back

175   Census 2001. Back

176   Opportunity Age: Meeting the Challenges of Ageing in the 21st Century (Stationery Office, 2005). Back

177   Delivering Housing for an Ageing Population: Informing Housing Strategies and Housing Policies (HOPDEV, 2005). Back

178   Modest but Adequate-a reasonable living standard for people aged 65-74. Age Concern's summary and policy conclusions (Age Concern England, 2002). Back

179   Households below average income 2003-04 (DWP, 2005). "Poverty" is defined as income below 60% of median household income after housing costs. Back

180   Pensions: Challenges and Choices-The First Report of the Pensions Commission (2004). Back

181   Yet according to the UK Housing Review 2004-05 there has been decreasing levels of state help for homeowners (for example, a 90% reduction in help since 1990-01, despite a significant rise in homeownership amongst lower income groups). Back

182   English House Condition Survey 2001 (ODPM, 2003). Back

183   Delivering housing for an ageing population" Informing housing strategies and planning policies (HOPDEV, 2005). Back

184   www.jrf.org.uk/housingandcare/lifetimehomes Back

185   General Household Survey 2001. Back

186   Breaking the Cycle (Social Exclusion Unit, 2004). Back


 
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