What is a retirement village? – Our Complete Guide

A couple of years ago, law firm, Shakespeare Martineau published a white paper titled ‘How we can make retirement housing aspirational and not a sign of a crisis.’ The report highlighted the significant gap between public perception of the retirement housing sector and the reality. It showed a poor understanding of the facilities, services, and activities that retirement villages commonly offer and a lack of awareness of the benefits to residents.

We believe it is these misconceptions that prevent some people from considering a retirement village as a positive and viable housing option.

The benefits of retirement villages

The benefits of living in a retirement village are, to us, obvious. But it seems the positives are still relatively unknown to a large proportion of the population, which isn’t the case outside of the UK. If you look to New Zealand or the USA, moving to a retirement village is an expected stage of later life. The difference is that here, it is too often synonymous with an ‘old people’s home’ or ‘care home,’ whereas over there, they are seen as something to aspire to!

The benefits…

• Safety and security – Retirement villages are secure communities that prioritise the safety and wellbeing of residents. With professional staff, controlled access, emergency response systems, healthcare services, and a strong sense of community, the goal is to make sure everyone has complete peace of mind.
• Facilities – Villages are not only located with great facilities on your doorstep, but they have a host of facilities onsite including bar and bistro, gym, hairdressers, hobby rooms (woodwork and craft,) IT suite, library, and village hall.

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The difference between retirement villages & care homes

It is true that care homes and retirement villages have some commonality. They are both designed for those who are older and there are some care facilities in a village, otherwise, they are starkly different. Residents in a care home generally have a bedroom, share communal areas, and everyone has varying levels of care needs, some around the clock.

Whereas retirement villages promote independent living for as long as possible, and at ExtraCare, only 20% of our residents are actually in receipt of care. Before new residents move in, we will establish any care needs through an assessment, but we must emphasise that we may not be able to facilitate extensive requirements.

Within retirement communities, everyone has their own apartments or bungalows, they can utilise the onsite facilities as they wish, all whilst no longer having to worry about the upkeep of their own home as the maintenance of the village is taken care of.

ARCO (Associated Retirement Community Operators), the main body representing the retirement community sector in the UK, wants to change this ‘care home’ perception. The vision is to house 250,000 older people in Integrated Retirement Communities (IRC’s) by 2030 – an ambitious target, but one we fully support here at ExtraCare.

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The ExtraCare way of living

Although there are now many Integrated Retirement Community developers within the UK, we are very proud of our unique model and our charitable status.

The ‘ExtraCare way of living’ has resounding health benefits for our residents and cost saving implications for the NHS. All of which was demonstrated in our research studies with Aston and Lancaster Universities. The full results are here but in essence, our residents are never or hardly ever lonely (86.5%), have a reduction in anxiety symptoms (23%) and depressive symptoms (14.8%), exercise more (increase of 75%), and have improved autobiographical memory (24%) and memory recall (17%).

As the UK’s leading not-for-profit retirement village developer, we don’t have shareholders and we don’t pay dividends. All our surpluses are invested back into the charity, helping us provide better services and support. Being efficient, delivering good value for money and generating surpluses is the best way of ensuring we remain successful and sustainable, now and in the future.

The charity relies heavily on the support of many individuals to help make our vision – ‘better lives for older people’ – a reality. Volunteering, donating, fundraising and our charity shops are all essential components of our model which supplement the sales, rental and other income we generate from our residents or usage of our facilities.

The cost of retirement villages

The cost varies massively depending on retirement village developers, but at ExtraCare, our principal aim is to ensure that we can offer our residents a truly rewarding lifestyle at a cost that is affordable and fair for all. Our property prices are representative of the area in which they are situated, meaning prices could fluctuate depending on the housing market at the time. Our diverse mix tenure makes us affordable for people from a range of backgrounds and circumstances and reflects the diversity of our communities.

• Outright sales: 40%
• Shared ownership: 40%
• Social rent: 20% (Please note we do not offer private rent)

In addition to the property purchase there are on-going monthly charges. These will also vary according to location and consist of:

• Service Charge
• Management Charge
• Amenity Charge
• Community Charge

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Retirement living before retirement

The name “retirement village” isn’t exactly all correct, as we do have a few residents living in our properties that are still working. Generally, these people are just doing bits and bobs part time, and are winding down slowly. There isn’t a rule book that states you can’t move in until you’re completely retired! 

What age can you move into a retirement village?

Retirement villages primarily welcome those over the age of 55 with no upper age limit. The age that people decide to move in is entirely up to them as it’s a very personal decision that suits different people at different stages of their life. One thing we will say, is that most of our residents say they wished they’d moved in sooner!

Which are the best retirement villages?

The answer to this question depends entirely on personal preferences, finances, location and many more factors. What might be a great choice for one, could be the complete opposite to someone else’s ideal. For example, some may prefer a larger village, or some prefer smaller housing developments.

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Are retirement villages a good investment?

Buying a retirement property means buying into the lifestyle, the community, the safety, the security and overall peace of mind that comes with retirement living.

Retirement villages provide a solution for the needs of people in later life, such as care if and when it’s needed, alongside a wealth of activities, facilities, communal spaces and a sociable likeminded environment that you simply don’t get if you stay in your home. A very worthwhile investment if you ask us!

Is it possible to get a mortgage on a retirement property?

At ExtraCare, residents generally cannot get mortgages on retirement properties due to the buyback clause in the lease (explained in more detail below.) Unfortunately, there aren’t any banks that will lend, so all of our buyers are cash buyers.

What happens when residents move out of a retirement village?

Many retirement village operators expect either the resident or their family to sell the property themselves, whilst still paying all of the service charges even if they’ve moved out!

However, with an ExtraCare retirement property (outright or shared ownership), we will buy the property back from the resident or their estate (minus some deferred fees and other charges) when they leave. A few things to make a note of:

• A long-term maintenance fee is taken out of the estate when the property is sold back to us.
• Nobody is allowed to leave their home to a relative or friend in the area who fits the age criteria – they would need to apply for a place separately.
• ExtraCare is able to terminate the lease if payments are missed or if any of the leaseholder covenants are breached.

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Can you put your name down for a specific retirement property?

Future residents will be asked to prioritise a selection of apartments, and our sales consultants will endeavour to meet their first choice, although we cannot guarantee this as our properties are not offered on a first come first served basis. However, if people are happy to sit tight and wait for their preference to become available, that is also ok.

How big are retirement villages?

Retirement villages can vary greatly in size, however they tend to be relatively large developments, hence the use of the word “village.” At ExtraCare, our biggest village is Lark Hill in Nottingham with 400 residents.

Do retirement villages have a shop?

If a village is relatively central in a town or a city, it may not have an on-site shop as there are so many close by. However, if a village is a bit out of the way, they are likely to have a little food shop stocking the essentials. At ExtraCare, any shops that we have on-site are independent shop owners that rent the space in the villages. The shop at Stoke Gifford Village recently won a BBC community award!

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Are residents allowed to make improvements or changes to a retirement property?

Retirement properties are built to a very good standard, with a high quality finish, making it unlikely residents will need to do anything to their home to modernise it or to make it suitable for their needs.

However, we do have about 2% of our residents change the décor, with a few choosing to paint or wallpaper the walls, but mostly we’ve found people just leave their apartments as they are.