Retirement Home

So what are Retirement Homes?

Retirement homes, the word might sound synonymous with old age home to many. But there is a strict line of difference between these two. The concept of retirement homes is well known in the developed markets but this is new to the emerging markets like that of India. Before we dig deeper into this let us take a look at what is the actual concept of these homes. 

What are retirement Homes?

Retirement homes are one where the senior citizens are only allowed. Confused! Well this is the concept. Here, the entire society or property that is being developed is only for the citizens above the age of 60 years. These are homes where a person can buy a property to spend the golden years after having a hectic work life. These homes can be put on rent also, but the beauty is that the tenant too needs to be a senior citizen. In the later part your heir can inherit the property but can use only after he ‘qualifies’ as a senior citizen. In these homes, each person or couple in the home has an apartment-style room or suite of rooms. Additional facilities are also provided to which we will come on the later part of the article. 

How are they different from old age homes?

We have mentioned earlier that the retirement homes are different from that of old age homes. Let us look at how they are different. An old age home is one where a senior citizen can stay after paying a fee either annually or on a monthly basis. However, in India, there are more than a thousand old age homes. Most of them offer free accommodation. Some homes work on a payment basis depending on the type and quality of services offered. Apart from food, shelter and medical amenities, old age homes also provide recreational activities for the residents too. Old age homes also provide access to telephones and other forms of communication so that residents may keep in touch with their loved ones. Some old age homes have day care centres. These centres only take care of senior citizens during the day.

On the other hand, retirement homes are one where you need to buy the property whichever is being offered ranging from 1 BHK to a cottage. Under this concept, there are two categories which are independent living and assisted living. In assisted living, you will get 24x7 services and this is meant for those senior citizens who need help. Independent living is for active senior citizens who can take care of themselves. Most retirement projects provide both the facilities in the same space. According to an April 2013 updated report titled, Senior Living Sector in India, by Jones Lang LaSalle India, currently there are 30 completed retirement or senior citizen projects in India. Bangalore has seven such projects, the highest in India, and there are 30 more such projects in the pipeline across the country.

Checklist for selecting right retirement home:

• Healthcare Accessibility
• Social Ecosystem
• Connectivity
• Crime Rate

Demand for retirement homes?

According to a report published by research firm JLL, it has mentioned that in an analysis of 135 urban cities / towns in India with a total population of 223 million and total 52 million households, the households with seniors represent 12.8 million (24.6 per cent). Of these 12.8 million senior households, the demand for formal senior living facilities from varying SEC and income typologies will be about 312,000 units. 
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The breakup of these 312,000 units per SEC, Income and geography is shown in Figure 10, 11, 12 and 13. Typically the ticket price for high-income senior units would be between INR 50 – 75 lakhs or above, mid-income will be INR 25 – 50 Lakhs, low-income between 10 – 25 Lakhs and BOP below INR 10 lakhs. 

Majority of these developments have 50-100 units in the form of residential complexes, with larger ones having over 400 units. The typology of units varies from 1 BHK-3 BHK units, villas and studio apartments. The size of these units range from 500 sq ft to 2,500 sq ft super built-up (saleable) area. These units are offered under various sale models such as outright sale, upfront deposit and lease. 

Most of the projects are at the affordable levels with figures less than INR 3,300,000 bearing the fact that the end consumers are senior citizens. However, there has been a recent shift with more mid and high-end projects being launched in the market showing signs of maturity of the sector and growing confidence among the developers to launch niche projects. The charts (Figure 14 and 15) show market segmentation based on pricing, unit sizes and financial model.

Facilities provided at retirement home? That goes the demand. Let us take a look at what are the facilities that are being offered at retirement homes. The first and foremost that comes is the person opting for retirement homes is of independent living (IL). An IL unit is not different from traditional housing but is better designed from an architecture standpoint with various design interventions taking care of seniors. Secondly and the most important part is the Skilled Nursing Care (SNC) which provides the residents with nursing care facility. It has provision for taking care of physical or mental disabilities and the residents are provided with physical, occupational and rehabilitative therapies. 

The Emerging Need for Senior Housing in India 

Although India is still younger than USA and Japan from a demographic standpoint, the process of ageing has begun in the country. It is anticipated that the elders in India would increase both in absolute numbers and relative strength, indicating a gradual swing to a senior population. As per Census of India projections, the percentage of elders as a percentage of total population in the country would jump from 7.4 per cent in 2001 to 12.4 per cent in 2026 and touch 19.7 per cent in 2050. 

In 2011, India had about 76 million seniors above the age of 60 years and it is expected that this figure will grow to 173 million by 2025, further increasing to about 240 million by 2050. This marked increase in elderly population would involve a change in an important sociological aspect, the ‘old age dependency ratio’. Interestingly, by 2050, it is estimated that the number of dependent adults in India will be at par with the number of dependent children. 

The population pyramid shows that the movement of the bulge in the population northwards to higher age cohorts with time. Besides growth in sheer numbers, seniors are also evolving as a customer segment and have needs and wants, which are different from seniors in earlier times. A significant section of seniors today are independent, financially stable, well-travelled, socially connected, and as a result have well developed thoughts of how they want to spend time after retirement. There is, today, a larger percentage of educated seniors than ever before in India.

(excerpts from “Senior Living Sector in India” report by JLL)