Senior Living

Senior Living in India: A 10-Point Comprehensive Guide to Market Expansion, Demographic Shift

With a current population of over 100 million seniors, India stands at the threshold of a significant demographic transformation. The senior living sector in India holds immense potential for investment and development, as highlighted in JLL’s latest report, “The Rise of Senior Living Market in India.” This report forecasts a notable increase in the senior population share from 10% to 20% by 2050, accompanied by an age dependency ratio of approximately 34%. As India prepares for this demographic shift, the senior living sector emerges as a pivotal area for growth and innovation.

Factors Driving the Need for Senior Living

Several factors are driving the demand for senior living communities in India:

1. Rise of Nuclear Families

The traditional joint family system in India is gradually giving way to nuclear families. Increased mobility for career opportunities often leaves elderly parents living alone, creating a need for safe, supportive living environments.

2. Increased Mobility for Career Opportunities

As younger generations move across cities and countries for better career prospects, the elderly are left to fend for themselves. This mobility highlights the importance of reliable senior care services.

3. Growing Demand for Senior Care Services

There is a growing demand for comprehensive senior care services that include medical care, wellness programs, and social bonding opportunities. This demand has paved the way for bespoke senior living communities that cater specifically to the needs of seniors.

4. Changing Views Towards the Asset Class

The perception of senior living is evolving. Once considered a last resort, senior living communities are now viewed as viable options offering a higher quality of life, independence, and social engagement.

Key Statistics in the Senior Living Market

The senior living market in India is poised for significant growth. Some key highlights from recent research include:

The senior population share is expected to rise from 10% to 20% by 2050.

The age dependency ratio is projected to reach approximately 34% by 2050.

Independent living units dominate the existing supply, with an 84% market share.

The market size is anticipated to grow from the current USD 2-3 billion to approximately USD 12 billion by 2030.

Estimating the Demand for Senior Housing

The demand for senior housing is set to rise with the increasing aging population. Factors such as higher life expectancy, nuclearization of families, and rising income levels contribute to this growing demand. 

Snehil Yadav, a luxury real estate influencer says, “The current demand for senior housing is estimated at 18-20 lakh units, with expectations for significant growth in the next five to six years. This presents a lucrative opportunity for real estate developers and institutional investors.”

Supply and Demand Dynamics

Despite the rising demand, the supply of senior housing in India remains limited. With close to 20,000 units in the organized sector, the current availability translates into a 1% penetration rate, indicating a substantial demand-supply gap. In contrast, countries like the US, UK, and Australia have more mature senior living markets with 6-7% penetration rates.

Rise in Targeted Offerings for the Aging Population

Senior living in India is being offered through various formats, including independent living and assisted living. Independent living facilities cater to seniors who can manage their daily activities independently but prefer the convenience of community living. Assisted living, on the other hand, provides additional services such as housekeeping, medical coordinators, physiotherapists, and on-premise nursing attendants.

Road Ahead for the Senior Living Segment

The senior living segment is gaining traction in tier II cities due to their slower pace of life and less population-related infrastructure stress. Cities like Ahmedabad, Surat, Coimbatore, Kochi, and Panaji are becoming preferred destinations for senior living accommodations. The demand is also rising in pilgrimage places such as Vrindavan, Ayodhya, Dwarka, and Rameswaram.

Challenges and Opportunities

While the senior living market shows immense potential, it also faces challenges. The high cost of construction and project profitability targets make it difficult for developers to cater to the low and mid-income segments. However, advancements in construction technology, such as Building Information Modelling (BIM), 3-D printing, and the use of robotics and Artificial Intelligence (AI), can help reduce costs and make senior living projects more accessible.

Financing and Policy Support

Potential end-users often face financing challenges when investing in senior living housing. Banks and financial institutions play a crucial role in providing funding schemes tailored for older citizens. Lower interest rates and refinancing options can facilitate the purchase of age-appropriate dwellings.

Enhanced policy support can further encourage developers and investors to enter the senior living market. Government schemes like Atal Vayo Abhyuday Yojana (AVYAY) provide financial assistance for the maintenance of senior citizen homes, improving the quality of life for seniors. Tax incentives, relaxation in development charges, and inclusive land use permits can also boost the development of senior living projects.

Integrating Senior Living in Larger Communities

Some leading developers are considering dedicating portions of apartment towers within townships for senior living housing. This integration creates vibrant and lively communities for the elderly while increasing feasibility and profitability for developers.

The Role of Institutional Investors

Institutional investors are increasingly recognizing the untapped potential of the senior asset class. With the rising population, the demand for these projects will continue to grow, attracting global players to the Indian market. This influx of investment is likely to bring significant innovation in terms of offerings, business models, and pricing strategies.

The rise of these projects in India is a result of multifaceted factors, including changing family dynamics, economic empowerment, and technological advancements. These projects offer a unique blend of independence, community, and convenience, making them a compelling choice for both residents and investors.

As India’s population continues to age, this sector presents a smart and promising investment opportunity. By addressing the evolving needs of senior citizens and ensuring their well-being, such projects are set to play a crucial role in the future of Indian real estate. The ascent of senior living projects marks a significant step towards creating a supportive and vibrant environment for India’s elderly population.

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