Question Mark and Many Arrows - Choices

Occupancy rates at traditional, full service care homes has, on the whole, been decreasing since 2006/07.

Upon closer analysis of this decline, the situation does not look like changing any time soon. Reduced occupancy coupled with increasing staff, property and medicinal costs has led to reduced profitability for care home providers.

It is this sustained reduction in profitability that has not only seen the number of care homes entering some form of insolvency increase, but also a genuine shift towards alternative forms of elder care. The most popular of which is domiciliary care, or care at home.

The huge advantage of domiciliary care is, not only is it cheaper, but it also removes the need to move from ‘home’ into a completely new environment which can be immensely daunting for vulnerable elders.

On the flip side to this however is that some elders seek company and are very willing to move into residential care where this need will be satisfied.

Source: Knight Frank


However, this market shift provides a number of opportunities. First, the increasing number of insolvencies gives Insolvency Practitioners and turnaround professionals an opportunity to enter into, what is, a burgeoning market. Traditional care homes, although reducing in number, will never cease to exist.

As mentioned earlier, one of the huge draws of domiciliary care is that it removes the need to leave ‘home’. If the right prospects are sought out, there is a huge opportunity.

Another opportunity lies in the diversification of residential care homes into specialist nursing care homes which house elders who require 24/7, round the clock, specialist medical care.

Although these homes have huge costs, due mainly to the requirement to employ medically trained doctors and nurses and to provide medical equipment, the average weekly fees that can be charged are significantly higher to a traditional care home which presents a viable option for a restructure compared with the route of formal insolvency.

This post was edited by Ashley Neville. For more information, email

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This blog is intended only as a synopsis of certain recent developments. If any matter referred to in this blog is sought to be relied upon, further advice should be obtained.