The Health and Social Care Industry are currently worth in excess of £20 Billion. The increase in demand is very easy to understand when you consider the great advances in modern medicine and technology. The UK has an ageing population with government reports indicating that care homes need to double over the next 25 years. This asset class offers excellent defensive qualities in times of economic uncertainty.
With Higher returns compared to more traditional asset classes, Care home investments can be highly profitable, offering annual returns of up to 10% or more and the opportunity for capital growth. Care homes are operated by experienced and professional companies who are dedicated to provide an excellent level of care and facilities to residents, as well as ensuring that you receive hassle-free returns.
With years of experience we have found that care home investments are massively under-valued, with a mixed bag of off-plan, newly renovated or operating care-homes they can often offer investors a more instant income as they do not have to wait for the property to be built. Care homes are what we see as a mid-range investment coming in at an entry price of around £70k-£80k. Rental yields are also attractive at around 10% for many opportunities.
Care-Homes are a necessity in all areas of the UK, however as an investment certain areas do offer better prospects. Firstly we look at ratio of elderly people, so for example Manchester has a very high ratio of young people, meaning it is suitable for student accommodation and apartments for young professional but demand of care-homes is far lower.
As an experienced investor it is important to look at the demographics, for example locations far from the hustle of large cities, be it towns, villages and even the country-side will have a much higher retired population. It is these areas where the elderly wish to remain, therefore demand on care-homes is consistent. In addition to this these more remote locations are by nature cheaper than anywhere in or near a large city centre, therefore prices remain far lower, thus offering a better pound for pound investment with higher yields. Read why one should invest into a care home.