Although the senior housing sector in India is at a nascent stage, it presents huge opportunities for real estate developers, service providers, healthcare players and operators. According to a report by the PHD Chamber of Commerce and Industry, titled ‘Senior Housing: A Sunrise Sector in India’, developers felt that this sector has the potential to reach USD 7.7 billion by 2030, from USD 1.26 billion in 2016, on account of the conducive framework in our country.
According to the survey, around 78 per cent of senior housing projects in India are operating in the western and southern regions, while only 22 per cent exist in northern India. The key cities that emerged as a retirement-friendly destinations in the northern region are NCR, Chandigarh, Dehradun, Lucknow, Jaipur and Amritsar. In the north-eastern region, the emerging retirement cities are Guwahati and Shillong. In the eastern region, Ranchi, Jamshedpur, Kolkata and Patna are the emerging cities. Mumbai, Pune, Nasik, Ahmedabad, Vadodara, Panaji and Surat are the cities opted by residents in the western region. Bengaluru, Chennai, Hyderabad, Coimbatore, Mysore and Puducherry are the key cities in the southern region, which have emerged as preferred post-retirement destinations. The key factors that contributed to cities being considered as retirement-friendly destinations, include better connectivity, being native places, familiarity with the area, climatic familiarity, better employment opportunities for children, etc.
Most of the respondents (about 70 per cent) opined that the top five places that will emerge as retirement-friendly destinations, were Bengaluru, Hyderabad, Mumbai, NCR and Chandigarh. About 52 per cent of the respondents expressed their interest in post-retirement employment assistance in areas like education, teaching, administrative, NGOs, etc. Further, about 57 per cent of the residents opined that they would like to opt for loan facilities for purchasing senior living homes. The study focused on the senior housing sector in India, the views of key players or stakeholders operating in this sector, including consumers. A survey of about 30 senior housing project developers, 486 senior housing residents and 2,598 prospective consumers, was undertaken.
Senior housing developers in India
According to the survey, around 30 per cent of the developers have been operating senior housing projects in India for about 2-5 years, 25 per cent for around 1-2 years and 5-7 years each and only 20 per cent for more than seven years. The survey highlights that around 60 per cent of the companies operating senior housing projects in India are of Indian origin, 30 per cent are operating through joint ventures with Indian companies and only 10 per cent are companies are of foreign origin. Around 80 per cent of the developers have developed less than five senior housing projects on an average, whereas, 15 per cent of the developers have developed more than five projects and only five per cent of the developers have developed more than 10 projects. This may be attributed to the hurdles faced by the developers, related to land acquisition, financial assistance and regulatory framework, etc., while undertaking senior housing projects.
Ankur Gupta, joint managing director, Ashiana Housing Limited, which has developed several senior housing projects in India, maintains that there is a need to better understand senior living in India and it should be taken up seriously, in the times to come. Gupta emphasised that the government of India should lay more emphasis on senior housing, in terms of land availability throughout the country and make senior housing attractive for developers, by giving some kind of benefits on GST or through RERA.
Senior housing projects in India: Rates and timelines for completion
The survey found that the per sq ft rates for senior housing projects in the western region, varied from Rs 9,000-10,000, while in the southern region it was Rs 4,000-8,000 and in the northern region it was Rs 5,000-7,000. The average price range of senior housing projects varies across India, with 1-BHKs ranging between Rs 25 and 40 lakhs, 2-BHKs in the price range of Rs 40-80 lakhs and 3-BHKs in the range of Rs 80-150 lakhs.
The survey reflected that the average time to complete all the procedural formalities to start senior housing projects in India, varied from three months to more than 12 months. While 55 per cent of the developers are of the opinion that it takes 6-12 months to complete the procedural formalities, 35 per cent feel that the time varies from 3-6 months and 10 per cent believe that the time taken is more than 12 months. This is due to various cumbersome formalities, related to land registration, obtaining of construction permits, electricity connection and various other formalities.
Around 60 per cent of the developers offer the complete sale model, 30 per cent offer only lease deposit model and only 10 per cent of the developers offer a pure rent model. About 30 per cent of the developers provide post-retirement employment assistance programmes to their residents and 70 per cent of the developers provide loan facilities to the buyers of senior housing flats/apartments.
Preference of senior citizens
According to the residents’ survey, about 65 per cent of the residents have purchased their apartment/flat/independent house in senior housing projects. The income levels over the past years have risen and provided scope for increased savings. Therefore, savings at the time of retirement, supported them to buy property. Around 25 per cent of the residents opted for ‘Lease Deposit Model’ and around 10 per cent of the respondents opted for a ‘Pure Rental Model’. The survey revealed that a large percentage of residents (43 per cent) purchased 2-BHK apartments, followed by 1-BHK apartments (26 per cent), 3-BHK flats (21 per cent) and the remaining 10 per cent purchased independent villas. All respondents unanimously opined that with rising age, the inclination towards healthcare facilities and food requirement increases, while the requirement for shelter tends to remain minimal. Therefore, small apartments fulfil their need.
The top ten priorities of residents, while choosing a senior housing project
- Location of the project
- Size and space of the project
- Comfort and design features
- Quality of life
- Price of buying a unit
- Cost of maintenance
- Healthcare services
- Facilities offered by service provider.
Reasons for opting for senior housing projects
According to the prospective consumers survey, 78 per cent of the total respondents expressed their interest in opting for senior housing, owing to various factors such as ease of living with support facilities like assistance in day-to-day activities, healthcare facilitates, recreational activities for remaining socially connected, etc. A large share of the respondents (33 per cent) preferred to opt for senior housing between the age group of 65-70 years, followed by 29 per cent in the age group of 60-65 years and 19 per cent ion the age group of 70-75 years.
Key challenges and opportunities for the senior housing sector in India
Rising nuclear families and the working population of our country, are pushing seniors to prefer living separately, while simultaneously remaining socially connected and fit. Seniors, today, prefer to remain independent, financially stable, well-informed, socially connected and therefore, the demand for senior housing is likely to grow. The growing senior housing sector is likely to push growth, productivity, investments and employment in other sectors of the economy such as healthcare, construction, hospitality, etc.
The key challenges for the senior housing sector in India, are lack of availability of skilled manpower, lack of affordability, social stigma, lack of awareness and high cost of marketing. The size of the elderly population in India, i.e., persons above the age of 60 is growing rapidly. For a developing country like India, this may put pressure on various socio-economic fronts, including pension outlays, healthcare expenditure, fiscal discipline, savings, etc. Hence, there is an urgent need to pay attention to ageing-related issues and promote holistic policies and programmes.
There is a need to introduce a single-window mechanism for the elderly, to enable them to obtain all facilities including life insurance, health insurance and information about senior living apartments under one roof. The government can also facilitate developers, by setting up hospitals, police stations, health camps, etc., near senior housing projects to boost its acceptability, the study added.
Rajeev Talwar, vice-president, PHD Chamber, points out that it is necessary to recognise that senior citizens are a valuable resource for the country. Hence, we need to create an environment that protects their rights, provides them with equal opportunities and enables their full participation in society. Going ahead, senior housing projects, will be vital, to meet the needs of the elderly population and promote their welfare and livelihood, he sums up.