The beleaguered care home sector is increasingly polarised between well-performing homes commanding premium fees, and older style converted buildings that are reliant on social services, according to a South West property specialist.
Grace Hicks, (above) senior surveyor at commercial property consultancy Lambert Smith Hampton (LSH), said there has been a sharp rise in insolvencies in the care home sector.
“Our experience shows homes do not necessarily need to close. The good news is that now we are into the new financial year for local authorities, we can report that most are making increases in their fee rates and private payers don’t seem to be resisting increases of four to seven per cent.
“Our view is that this issue will be self-correcting quite quickly, if only because of the sheer volume of pent-up demand. It will be noted that domiciliary care – the main alternative to care homes – has suffered a greater relative impact from the National Living Wage.
“The current market appears to be increasingly polarised between well performing homes that command premium private and top up fees, and those often older-style converted buildings, reliant on social services that are facing increasingly difficult trading conditions.”