As many of you reading this may already know, care home investments can be extremely profitable. The sector is one of the fasting growing in the property investment industry which can be accredited to both a growing and aging UK population. Consequently, it is predicted that the demand for care homes in UK will rise by around 60% by 2023. This level of demand supports the profitability of investments in this sector. In today’s blog, we will explain how to identify care home opportunities, what expenses to be aware of when converting a property, what regulations to look out for and how to go about housing your care home.
How to identify a care home opportunity: You may look to invest in an individual studio within a care home. This kind of investment is easy to come across these days. Doing so, will save you money on having to purchase and convert a standard residential property but won’t provide anywhere near the same kind of profits. Alternatively, if you’re looking to identify bigger opportunities with greater returns on your investment then you should look to purchase and convert a standard residential property with the potential of becoming a care home. This is initially a more costly method but provides the opportunity for much greater profits in the future. If you choose to go down this route, you should first ensure the area in which you are looking to invest has enough demand for care homes. With the UK’s ever-aging population, this should become more and more common over time. Additionally, as with any property investment, you should try to ensure the property doesn’t have any hidden issues.
What regulations and expenses to look out for: If you choose to purchase and convert a property into a care home then there are some things to look out for. As with all properties which require developments, planning permission is required. Additionally, it’s quite likely that building control regulations will also need to be met. Both requirements will come at a cost as you will need to hire an architect to draw up the plans for the development to ensure the development is cleared by the council.
Looking more specifically at care homes, the sector is highly regulated and contains lots of legislation. An example of this is the health and social care act 2008, which states that the premises must be secure, suitable for purpose, properly used and maintained. Without delving too deep into the law, this effectively means that the development will most likely incur additional costs that you probably never even considered initially. And this is just one piece of a wide range of laws and regulations that you must consider before jumping head first into the care home sector.
How to market your care home: It can be difficult to market your care home because despite the increased demand in the market, there has been a subsequent increase demand in supply due to likeminded individuals such as yourself. As most people know, social media is an essential tool in modern day advertising and the care home market is no different. Utilising Facebook, Instagram and Twitter amongst other sites is important when marketing your care home. This method will attract the interest of potential residents’ friends and family. However, as most of the older generation don’t primarily use social media, more traditional forms of advertising are still just as effective and shouldn’t be overlooked in this technological era. It would be a more suitable idea to leaflet drop and advertise the home in magazines and newspapers, to reach elderly people directly.
No matter what type of advertising you choose to use, you must ensure that you focus on your target audience in order to make sure your advertising is effective. For example: are they situated nearby? Can they afford the price? Do you offer the facilities they need? You must consider all these factors to ensure you’re appealing to the right people so that your marketing budget doesn’t go to waste.
To summarise, investing in care homes can be tough and isn’t for those new to the property scene. But if you’re up the task then the rewards can be extremely lucrative.
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