Retirement Village penetration – stalled or going forward?

We revisit the PwC/Retirement Living Council Census of members, capturing 56 operators and 70,000 village homes.

Giving an insight into optimism, the above graph shows that operators are pulling back on development pursuit.

It shows that across the 56 operators, only 820 new homes in new villages will be delivered this year, compared to a forecast 1,063 homes made just 12 months before.

820 homes equates to eight new villages being built by the 56 operators.

 At the same time those 56 operators are delivering 758 new homes in existing villages. This is down from 1,217 that have been planned just 12 months earlier.

Included in the 56 operators are the big operators, Lendlease, Aveo and Stockland.

The historic penetration of 7% for the 75+ age group by retirement villages requires that we are building 5,500 new village homes a year. In FY20, the most being built is 2,500.

The FY21 forecast is 2,542 new homes, still well short.

Demand remains high with 110,000 people every month searching for a village home on our website villages.com.au.

The banks tell us they are positive in providing capital. So, it must be cautious executives that are not prepared to go hard on new development.

Do you agree?

Article Source: PwC/Retirement Living Council

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