Care Homes Construction Market Report UK 2026-2030
The 7th edition of the Care Home Construction Market Report delivers a comprehensive assessment of current and future development across the residential and nursing care home construction sector. Covering both private and not-for-profit sectors, it offers detailed insight into construction activity, market drivers, and long-term trends shaping the UK care landscape.
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The 7th edition Care Home Construction Market Report delivers a comprehensive assessment of current and future development across the residential and nursing care home construction sector. Covering both private and not-for-profit sectors, it offers detailed insight into construction activity, market drivers, and long-term trends shaping the UK care landscape.
Summary
The development of care homes is dynamic, and one of the more resilient areas of the entire construction market. That growth in demand primarily reflects an ageing population, along with greater life expectancy, increased complexity of health needs, and social factors that limit the capacity for home-based care. It is also, in part, impacted by legacy facilities that are less than optimal.
The adult care home sector is characterised by strong, rising demand that currently outstrips supply, with a significant, growing need for specialised care, particularly for dementia, which is expected to continue to rise. The complexity of the demand is furthered by financial considerations (both local authority and private wealth) and by individuals’ (as well as health service policies’) desire to preserve independent living where possible.
Report Overview
This report examines the size and performance of the care home new build market in recent years, market shares and places the care home sector in the wider context of residential care for the elderly. It examines key market trends and market drivers.
This report provides forecasts to 2030. The analysis is both qualitative and quantitative, with indications of key trends and views on the market prospects.
Market Size
The total market for contracts awarded for care homes in 2025 reached over £1.12bn, an increase of 43% year-on-year and continuing a long-term growth trend following the pandemic. Over £1bn of this was accounted for by care homes for the elderly, where the value of contract awards grew by 36%.
Market Trends and Influences
There is a vast array of growth factors impacting the adult care market and underlying the market development, including:
- Demographic changes – The number of people aged 85 years or more (the primary users of care homes) is projected to triple to nearly 5 million by 2050.
- Health factors and complexity of care – Along with the rising life expectancy, people are increasingly living longer with multiple, chronic, or complex health issues, further creating demand for care facilities.
- Economic and financial factors – A significant portion of care home demand is driven by individuals who can self-fund their care, often by selling their property or undertaking equity release. Significant past house price inflation has created a generation where some have substantial property assets that can be used to fund care.
- Operational and supply factors – Modern, well-maintained homes with specialised facilities (e.g., dementia wings) are in higher demand than older, less adaptable buildings. The replacement of legacy homes is also being hastened by new environmental and safety regulations. Potential residents also have increased expectations for modern facilities.
Constraining factors include: - Financial and economic pressures – High initial construction costs of care homes, while the running costs of adult care homes have also been subject to stronger inflationary pressures than other sectors.
- Workforce issues – A critical shortage of skilled staff makes it difficult to operate care homes, and this restricts expansion even by the chains.
- Planning and regulatory issues – Identifying land that is both suitable for development and located near necessary amenities (medical facilities, transport) remains challenging. Subsequently, gaining planning permission continues to be a slow process with major bottlenecks still being reported. Increasing inspection and reporting requirements from bodies such as the CQC place additional pressure on providers, particularly in proving quality and safety.
Product Categories
There are various types of care homes operating in the market offering short and long-term care to adult and elderly groups, including pure elderly care, dementia, mental health, learning disability, alcohol & drug dependence, and physical disability.
The main types of care homes are:
- Residential Home/Care Home – residential basis on either short or long term. They provide accommodation, meals, personal care (help with washing and eating).
- Nursing Home/Care homes with nursing – although these bear many similarities to care homes, they also have registered nurses to provide care for more complex health needs.
Some care homes may be registered as both ‘with nursing’ and ‘without nursing’, for example, if they take residents who need nursing care, and those who only require personal care.
Companies Mentioned
Many contractors active in the care home construction market are mentioned in the report.
Key companies include:
- LNT Care Developments
- Churchill Retirement Living
- McCarthy & Stone
- Lawrence Baker
- Kori Construction
- LNC Property Developments
- The Torsion Group
- Walter Thompson (Contractors)
- Deeley Construction
- Wynbrook Homes
- McGoff Construction Services
- Highwood Group
Regional Analysis
2025 saw particularly strong growth in contract awards in the South East and London, in line with the widespread strategy of the care home sector of targeting affluent areas for luxury properties to offset growing running costs. Nonetheless, year-to-year activity in the regions tends to vary quite strongly, though there has been an increase following the COVID-19 disruption.
Forecast
With capital availability not a substantial issue as the larger chains of adult homes gain external finance and often utilise sale-and-leaseback to fund future development, Barbour ABI expect continued growth in activity as the industry seeks to address demand issues. The major constraints are expected to be planning permission delays and operational issues, particularly revolving around staffing.
1 INTRODUCTION
- 1.1 Context
- 1.2 Sources of information
- 1.3 Abbreviations
2 MARKET SUMMARY
- 2.1 Market size
- 2.1.1 The established base
- 2.1.2 The care home industry structure
- 2.1.3 The care home construction activity
- 2.1.4 Contractor activity
- 2.2 Market drivers
3 MARKET SIZE AND SEGMENTATION
- 3.1 Market size
- 3.1.1 Great Britain
- 3.1.2 England
- 3.1.3 Scotland
- 3.1.4 Wales
4 CARE HOME SECTOR
- 4.1 UK
- 4.2 England
- 4.2.1 Introduction
- 4.2.2 North East
- 4.2.3 North West
- 4.2.4 Yorkshire and the Humber
- 4.2.5 East Midlands
- 4.2.6 West Midlands
- 4.2.7 East of England
- 4.2.8 London
- 4.2.9 South East
- 4.2.10 South West
- 4.3 Scotland
- 4.4 Wales
- 4.5 Northern Ireland
- 4.6 Major care home operators
- 4.6.1 Adult care
- 4.6.2 Child care
5 MARKET INFLUENCES AND DRIVERS
- 5.1 Overview
- 5.2 Political market influences and drivers
- 5.2.1 Care funding and the Independent Commission
- 5.2.2 Care home staffing
- 5.3 Economic market influences and drivers
- 5.3.1 The general economy
- 5.3.2 Self-funding costs
- 5.3.3 House price inflation
- 5.4 Social market influences and drivers
- 5.4.1 Population
- 5.4.2 Health
- 5.4.3 Care Home Demand
- 5.5 Technological market influences and drivers
- 5.5.1 Technology in care homes
- 5.6 Legal market influences and drivers
- 5.6.1 Design and building regulations
- 5.6.2 Energy Performance Certificates
- 5.6.3 Care home employment costs
- 5.6.4 Employment Rights Act 2025/Fair Pay Agreement
- 5.7 Environmental market influences and drivers
- 5.7.1 Net zero targets
- 5.7.2 Sustainability
6 CONTRACTORS
- 6.1 Industry structure
- 6.2 Market shares
- 6.3 Contractors
- 6.3.1 LNT Care Developments Holdings
- 6.3.2 Lawrence Baker
- 6.3.3 LNC Property Developments
- 6.3.4 Torsion Care
- 6.3.5 Kori Construction
- 6.3.6 Deeley Group
- 6.3.7 Walter Thompson (Contractors)
- 6.3.8 McGoff Construction Services
- 6.3.9 Wynbrook Homes
- 6.3.10 Highwood Group
7 MARKET FORECAST
- 7.1 Market issues
- 7.2 Market size and context
Table 1: Abbreviations
Table 2: UK Geographical Segmentation of Adult Care Homes, 2025
Table 3: UK Structure of Children’s Care Homes, 2025
Chart 4: Structure of the Adult Care Home Sector, by Provider Type, 2026
Chart 5: Structure of the Adult Care Home Sector, by Size of Group, 2026
Table 6: Leading Chains of Care Homes for Adults in the UK, 2026
Chart 7: Value of Contract Awards for Care Homes in Great Britain, by Type, 2020-2031
Chart 8: Analysis of Contractor Revenues from Care Homes and Sheltered Housing Activity, by Number of Contracts, 2020-2025
Table 9: Largest Contractors in the Care Home and Sheltered Housing Sector Activity, 2020-2025 (£m)
Chart 10: Value of Contract Awards for Care Homes in Great Britain, by Type, 2020-2025
Chart 11: Number of Contract Awards for Care Homes in Great Britain, by Type, 2020-2025
Chart 12: Number of Bed Spaces in Contract Awards for Care Homes in Great Britain, by Type, 2020-2025
Chart 13: Average Number of Bed Spaces in Contract Awards for Care Homes for the Elderly in Great Britain, by Type, 2020-2025
Table 14: Contract Awards for Care and Sheltered Accommodation, by Type, in Great Britain 2020-2025 (£m)
Chart 15: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in England, 2020-2025
Chart 16: Development of Elderly Care Homes Market in Wider Market Context in England, 2020-2025
Table 17: Regional Analysis of Contract Awards for Elderly Care Homes in England, 2020-2025
Chart 18: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in the North East, 2020-2025
Chart 19: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in the North West, 2020-2025
Table 20: Analysis of Contract Awards for Elderly Care Homes in the North West, by County, 2020-2025 (£m)
Chart 21: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in Yorkshire and the Humber, 2020-2025
Table 22: Analysis of Contract Awards for Elderly Care Homes in Yorkshire and the Humber, by County, 2020-2025 (£m)
Chart 23: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in East Midlands, 2020-2025
Table 24: Analysis of Contract Awards for Elderly Care Homes in East Midlands, by County, 2020-2025 (£m)
Chart 25: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in West Midlands, 2020-2025
Table 26: Analysis of Contract Awards for Elderly Care Homes in West Midlands, by County, 2020-2025 (£m)
Chart 27: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in East England, 2020-2025
Table 28: Analysis of Contract Awards for Elderly Care Homes in East of England, by County, 2020-2025 (£m)
Chart 29: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in London, 2020-2025
Chart 30: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in South East, 2020-2025
Table 31: Analysis of Contract Awards for Elderly Care Homes in South East, by County, 2020-2025 (£m)
Chart 32: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in South West, 2020-2025
Table 33: Analysis of Contract Awards for Elderly Care Homes in South West, by County, 2020-2025 (£m)
Chart 34: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in Scotland, 2020-2025
Table 35: Analysis of Contract Awards for Elderly Care Homes in Scotland, by County, 2020-2025 (£m)
Chart 36: Value of Contract Awards for Elderly Care Homes and Bed Spaces Added in Wales, 2020-2025
Table 37: Analysis of Contract Awards for Elderly Care Homes in Wales, by County, 2020-2025 (£m)
Table 38: UK Geographical Segmentation of Care Homes, 2025
Chart 39: Structure of the UK Residential Care Sector by Turnover, 2025
Chart 40: Structure of the Residential Care Sector in England by Turnover, 2025
Table 41: Regional analysis of Care Homes in England, November 2025
Table 42: Care Home Chains with More Than 10 homes in the North East, November 2025
Table 43: Care Home Chains with More Than 10 Homes in the North West, November 2025
Table 44: Care Home Chains with More Than 10 homes in Yorkshire and the Humber, November 2025
Table 45: Care Home Chains with More Than 10 homes in East Midlands, November 2025
Table 46: Care Home Chains with More Than 10 homes in West Midlands, November 2025
Table 47: Care Home Chains with More Than 10 homes in East of England, November 2025
Table 48: Care Home Chains with More Than 10 homes in London, November 2025
Table 49: Care Home Chains with More Than 10 homes in South East, November 2025
Table 50: Care Home Chains with More Than 10 homes in South West, November 2025
Chart 51: Structure of the Residential Care Sector in Scotland by Turnover, 2025
Chart 52: Structure of the Residential Care Sector in Wales by Turnover, 2025
Chart 53: Development of Adult Residential Care homes in Wales, 2021-2025
Chart 54: Structure of the Residential Care Sector in Northern Ireland by Turnover, 2025
Chart 55: Structure of the Adult Care Home Sector, by Provider Type, 2026
Chart 56: Structure of the Adult Care Home Sector, by Size of Group, 2026
Table 57: Leading Chains of Care Homes for Adults in the UK, 2026
Chart 58: Development of Barchester Healthcare, 2020-2024
Chart 59: Development of HC-One, 2020-2024
Table 60: UK Structure of Children’s Care Homes, 2025
Table 61: Children’s Care Home Development in England by type, 2021-2025
Table 62: Largest Companies Active in Children’s Care Homes in England, 2024
Table 63: Children’s Care Home Development in England by type, 2021-2025
Table 64: UK Care Homes Construction Market PESTLE Summary, 2026
Chart 65: Proportion of Care Home Residents State and Self-funding in England by Region, 2022-2023
Chart 66: Proportion of Care Home Residents State and Self-funding in England by Care Home Type, 2022-2023
Chart 67: Proportion of Care Home Residents State and Self-funding in England by Care Home Size, 2022-2023
Chart 68: Analysis of Care Homes with Self-funders in England, 2022-2023
Chart 69: Source of funding by Care Home Enquiries, 2024-2025
Chart 70: International Recruitment Trends in the Independent Adult Social Care Sector, 2020-2021 to 2025-2026
Chart 71: UK Quarterly GDP development, 2024 and 2025
Table 72: UK Bank Base Rate, and Dates of Change, 2020-2025
Table 73: Comparison of Forecasts for Key Economic Variables 2025 – 2029 (published November 2025)
Table 74: Monthly Costs of Self-Funding Residential and Nursing Care, 2025
Table 75: UK Estimated and Projected Population, by Country, Mid-2022-Mid-2025
Chart 76: UK Population Aged 65 Years or More, 2022-2032
Chart 77: Variation in Demand Change for Care Homes, By Region, 2025
Table 78: Design Changes in New Build Care Homes
Chart 79: Estimated Proportion of Care Workers on the NLW and On or Under the Wage Floor (NLW+ 10 pence) in the Independent Sector, 2016-2025
Chart 80: Comparison of NMW/NLW with CPI Inflation and Average Wage Growth, 1999-2026
Chart 81: Care Workers Nominal Hourly Pay and NLW in the Independent Sector, 2016-2025
Chart 82: Zero-hours contract status by selected job role (local authority and independent sectors), 2024/2025
Table 83: Structure of UK Contracting for Public Commercial and Industrial New Construction, by Size of Contractor, 2020-2025 (£m)
Table 84: Structure of UK Contracting for Private Commercial New Construction, by Size of Contractor, 2020-2025 (£m)
Chart 85: Analysis of Contractor Revenues from Care Homes and Sheltered Housing Activity, by Number of Contracts, 2020-2025
Table 86: Largest Contractors in the Care Home and Sheltered Housing Sector Activity, 2020-2025 (£m)
Table 87: Contractors in the Care Home and Sheltered Housing Sector Activity Undertaking Between 5 and 9 projects, 2020-2025 (£m)
Table 88: Contractors in the Care Home and Sheltered Housing Sector Activity Undertaking Between 2 and 4 projects, 2020-2025 (£m)
Table 89: Profile of LNT Care Developments Holdings, 2023-2025
Table 90: Turnover Segmentation of LNT Care Developments Holdings, 2023-2025 (£m)
Table 91: Profile of Lawrence Baker, 2023-2025
Table 92: Profile of Torsion Care, 2022-2025
Table 93: Profile of Kori Construction, 2023-2025
Table 94: Profile of Deeley Group, 2023-2025
Table 95: Turnover Segmentation of Deeley Group, 2023-2025 (£m)
Table 96: Profile of Walter Thompson (Contractors), 2022-2024
Table 97: Profile of McGoff Construction Services, 2023-2025
Table 98: Profile of Highwood Group, 2022-2024
Chart 99: Forecast Value of Contract Awards for Care Homes in Great Britain, by Type, 2026-2031
Table 100: Forecast Contract Awards for Care and Sheltered Accommodation, by Type, in Great Britain 2026-2031 (£m)
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Care Homes Construction Market Report UK 2026-2030
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