Household numbers are rising faster than the population due to falling occupancy rates and that the gap is increasing over time (Fig.1).

There are several factors fuelling this trend but the most important and challenging is the impact of an ageing population. The differences might sound minor but projections imply one-person households will account for 1 in 3 of all households by 2040 – that is 11m, of which 6m will be aged 65 or over.

In the UK, it is conventional to measure housing size by the number of bedrooms. Typically this number fluctuates between two and three over a householder’s life, with some variation either way. Space is at a premium in young family households and least under pressure at older ages.

To illustrate: a property with three bedrooms occupied by four people would have a one-bed deficit and one occupied by two people would have a one-bed surplus, on average. Scale this up to the population and it is easy to see the depth of the housing crisis as it affects struggling first-time buyers.

The research estimates some 20.3m surplus bedrooms by 2040, 12.8m of which will be in households aged 65 or over. From age 60, when over-occupancy mainly occurs, the market for smaller homes is gridlocked by huge shortages in supply, high prices and high taxes. So reversing this would make a big difference. But 97% of housebuilding is going into the front end of the age spectrum, with only 3% at the back end. Although surveys show that many people want to downsize, the number of such housing transactions has been falling for a decade or so.

But whatever the solution, the number of age-appropriate developments saw a dramatic downturn after 1990 (Fig. 2). The segment grew rapidly in the 1980s thanks to statutory sector and voluntary (not-for-profit) organisations. But the NHS and Community Care Act 1990 switched the focus to keeping vulnerable adults in the community, handing responsibility to local authorities and coupling it with cuts in housing subsidies. After that, the pace of development shrank to less than a quarter of its peak.

Around 7,000 new retirement properties have been added annually since 2010, with a total of some 750,000 homes today. But this is minuscule compared with annual increases of 180,000 in the number of 65 or over households. Private provision today stands at 12.4% of the stock, but it now supplies as many new properties as the voluntary sector. With more households seeking a comfortable retirement by cashing in their housing equity, big institutional players such as L&G and Aviva are now heavily investing in retirement housing, but more is needed.

It is hard, however, to avoid the conclusion that older people are not a priority for many local authorities. On the planning front, the research finds that fewer than 10% of local authorities have clear policies on housing needs for older people, including the number of homes required and how to provide them. The research argues that the government should promote the benefits of downsizing but do so before social care is needed. This requires a national strategy with government departments, local authorities and the NHS to be held accountable.

Downsizing can be financially complicated, including questions about value for money and security of tenure. A typical purchaser requires the equity in their original property to be well above the average price of the new one, and for annual charges to be affordable. More flexible finance, including fee deferral for service charges until a property is sold, is becoming common. Aligning the charges with the outgoings of retirees on fixed incomes in this way helps avoid large unexpected costs. The research calls for independent guidance to cover all aspects of the purchase process.

Stamp duty is an increasingly significant part of a typical property transaction but at current rates it jams up the housing market. It is no surprise that the industry has welcomed its temporary abolition on properties valued up to £500,000, but many also hope that the policy will become permanent.

If more people lived in age-appropriate housing, their health and well being would improve. The silo mentality at all levels in government does not help in developing a better policy on retirement housing. A joined-up approach is needed, with cross-departmental collaboration to reconcile differences and identify policy gaps.