The elderly as well as the young suffer from housing shortage
The UK government and media are both overlooking the serious shortage of suitable, affordable housing for older people, wrote Claudia Wood, the CEO of think-tank Demos. She warned the shortfall added to health and social care costs, cancelling out any savings made by the Department for Work and Pensions, while planning rules and bureaucracy have made it harder for developers to build sheltered or supported accommodation. Wood also criticised the government's plan to extend the housing benefit cap to take in supported homes (which it since dropped) and said sheltered housing saved health and care services £486m ($635m) annually.

Britain’s housing shortage is never far from the top of the political agenda. But the narrative focuses almost entirely on first-time buyers when there is an even more serious and overlooked shortage in suitable housing for older people.

This paucity affects both older homeowners stuck in unsuitably large family properties and unable to find smaller homes, and people renting social housing when they need sheltered or supported accommodation. In both cases, government policy is stifling the supply of the kind of housing older people want and need, while at the same time increasing the bill for health and social care.

Developers specialising in housing for older people have to grapple with a planning system that works against them. These homes tend to have higher build costs, more communal facilities and support services to arrange, making it hard for developers to bid against mainstream house builders for plots of land. There is little recognition of the need for older people’s housing in local planning rules, and the outcome of planning applications varies from local authority to local authority. It’s a bureaucratic, volatile system that leaves developers and their investors uncertain about the future and struggling to expand.

To make matters worse, the government is set to draw supported housing into the quagmire of universal credit by extending a blanket housing benefit cap to everyone receiving it, regardless of whether they live in private, social or supported homes. This means that from April 2019, those living in supported housing, 70% of whom are older people [pdf], will have their housing benefit capped at local housing allowance levels. A ringfenced, top-up fund is intended to cover costs that go above this – likely to be about a third of the total amount. “Ringfenced”, however, is no guarantee of sustained funding. The previous supporting people fund lasted all of six years before the ringfence was removed [pdf] and some housing schemes lost 50% of their funding within a year. That experience has taught providers to be wary of promises of sustained financial support that are vulnerable to the whims of new governments and changes in priorities.

Less sheltered housing is being built, with the current shortage of 17,000 properties set to double by 2020. The uncertainty generated by the LHA proposals have exacerbated this, putting the brakes on investment and planned developments. Yet we know sheltered housing saves health and care services some £486m a year [pdf] by reducing falls, shortening inpatient stays and so on. Denying older people access to this type of housing makes it likely that whatever the Department for Work and Pensions saves in welfare spending will be outstripped by the increase in NHS and social care costs.

Any housing policy that looked beyond the plight of first-time buyers would recognise the self-defeating nature of the LHA policy. There have been reports that the government is considering a U-turn on plans to cap housing benefit for people in supported housing. But we seem a long way from tackling the chronic shortage of older people’s housing.

Claudia Wood is chief executive of the thinktank Demos and gave evidence to the Commons communities and local government committee inquiry on housing for older people on 22 October.

This article was amended on 24 October 2017, following a government announcement that it has dropped plans to cap housing benefit for social housing and supported accommodation

Sign up for your free Guardian Housing network newsletter with comment and sector views sent direct to you on the last Friday of the month. Follow us: @GuardianHousing

Looking for a housing job, or need to recruit housing staff? Take a look at Guardian Jobs.