India as a market for retirement homes
There was a time when senior care in India meant charitable old age homes run for Destitute. But things have started to change. With shrinking family size and children no longer living with their parents, most elders find themselves lonely.
The concept of retirement community or housing for seniors although still carries a social stigma; is fast catching up. It started in Southern states like Kerala, Coimbatore, Tamil Nadu etc. but is fast spreading its wings across India. Retirement homes are no more old age homes for destitute. They are thriving communities with state of the art facilities and present a vibrant and fun environment for their residents.
Other than the need, it’s also a lifestyle choice for many to move into a retirement community. These communities are generally fully services and allow you to maintain your independent lifestyle without the hassles of managing the daily chores. For a retirement community, the real estate is just an enabler; their forte is the level and quality of services they provide. Almost all the retirement communities in developed countries have specific programs and activities to keep their residents engaged and give them a happy and healthy lifestyle.
A significant section of seniors today are financially stable, well-travelled and have a good idea of how they want to spend their time. Moving into a retirement community is a natural choice for them.
While India is much younger than Japan, china or United States, the number of people over age 60 is expected to more than double to 173 million by 2025. The country’s overall population is growing at 1.8% annually, but the ranks of senior citizens are swelling at a much faster clip at 3.8% every year.
According to a report by Jones Lang LaSalle, the current demand for senior housing in India is about 300,000 units, as compared to a supply of 10,000 to 15,000 new homes now in pipeline. Even senior NRI’s who are used to such facilities in developed countries are now looking at such options in their hometowns.
Most of India’s retirement homes are targeted towards urban middle and upper income buyers who value and understand the lifestyle provided at these communities. Retirement housing in India starts between 30Lakhs for a basic level and goes up to 9 Crore for the ultra-luxury properties. These are still cheap by western standards.
Unlike the west where retirement housing is typically rented, in India people prefer to own. This suits the developer also as well because it means less tied up capital.
Investing in Indian retirement homes generates better returns than that is typical for comparable ordinary housing in the country. This is primarily because of the huge Demand supply gap.
Moving into a retirement homes takes some convincing but residents are generally happier and more comfortable once they do.