The UK’s elderly care market is forecast to reach capacity by 2033 unless there is a wave of new development, according to Knight Frank’s Healthcare Development Opportunities Report 2026.
The report shows that the net supply of UK care beds grew over the past year to 480,000, with a 24% year-on-year uptick in new home completions offset by declines in supply in some areas and an increase in deregistration of older stock.
While the West Midlands recorded a net gain of almost 1,500 beds from 2017 to 2025, supply in the capital fell by around 2,000 beds over the same period.
Knight Frank’s analysis reveals that care home bed supply has expanded by just 2.4% over the past decade, lagging behind a 16.2% growth in the UK’s over-65 population.
The number of care home planning approvals granted in 2026 was also lower than in 2025, signalling a narrowing development pipeline and a widening gap between planning consent and completion of new properties.
Existing care home bed supply across the UK is also in urgent need of upgrading, Knight Frank reported; 79% of homes are more than 20 years old, rendering many functionally obsolete.
“The Covid-19 pandemic brought the UK care market into sharp focus, underscoring the critical need for an adequate supply of purpose-built [property] capable of meeting the complex needs of a rapidly ageing population,” said Julian Evans, global head of healthcare at Knight Frank.
“Despite a record year for UK healthcare investment in 2025, Knight Frank’s analysis demonstrates that supply is failing to keep pace with demand.
“Without a significant acceleration in both investment and development to upgrade standing stock and deliver new beds in core markets, the UK is fast approaching a crisis in care provision, with domestic bed capacity projected to reach saturation by the end of the decade.”
Ryan Richards, healthcare research associate at Knight Frank, added: “The critical undersupply of UK care home beds represents both a national imperative to deliver new stock and a rare opportunity for investors and operators.
“Strong demographic tailwinds and favourable supply-demand fundamentals underpin an attractive long-term investment case across the sector.”
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