Rob Kinsman, Regional Director for Care at Christie & Co, highlights the growing interest from first-time buyers in a range of UK care homes, including older, converted stock that offers an accessible entry point into the sector.
While modern, purpose-built care homes remain in high demand, smaller converted care homes continue to attract buyers. This trend is driven by a sophisticated pool of new entrants who recognize the sector’s resilience, the ageing population, and the shortage of bed spaces. Reflecting this, 9% of Christie & Co’s stock sold to first-time buyers in 2024, more than doubling from 4% in 2023.
Who are these buyers and what are they looking for?
Many new entrants have backgrounds in medicine (e.g., doctors, pharmacists, nurses) or finance. They are open to relocation and generally seek care homes priced under £2 million, typically period conversions with fewer than 30 beds.
Why has appetite increased and what does it mean for sellers?
Several factors are driving this growing appetite. Occupancy levels have fully recovered from the pandemic, exceeding pre-COVID figures in some areas. Demand for beds is high, reliance on agency staff has decreased, and banks have renewed interest in financing care home acquisitions, particularly for new entrants.
For sellers, this is an encouraging trend. Owners of smaller care homes now have greater opportunities to retire while selling their businesses as going concerns, ensuring continuity of care for residents and job security for staff. Additionally, successful sales at strong trading values enable sellers to reinvest in larger care facilities, further stimulating sector growth. Given the ongoing shortage of new builds in some areas, this trend is expected to continue.
Can first-time buyers get the necessary funding?
Despite sector challenges, lenders remain open to financing first-time buyers who can demonstrate competence, transferable skills, and a clear operational plan. A strong example is the sale of Ty Ceirios Nursing Home in Pontypool, sold through Christie & Co in early 2024. The buyers, though new to the sector, leveraged their business acumen to secure funding via Christie Finance. Their long-term ambition is to build a portfolio of quality care homes, with Ty Ceirios as their foundation.
Christie Finance reports that 29% of the deals it financed in 2024 were for first-time buyers, with an average loan size under £1 million—suggesting ideal acquisition prices between £1 million and £2 million. However, economic pressures and regulatory complexities mean new entrants will need substantial capital to secure funding. While high debt costs present challenges, the underlying demand for well-run, profitable care homes makes them a solid investment for both new buyers and banks.
Advice to anyone considering selling in 2025
For owners of smaller, converted care homes looking to sell, careful preparation is key. Here are essential steps to ensure a smooth sale:
- Start planning early – The process can take longer than expected.
- Appoint specialist advisers – Experienced professionals can guide you through valuation and sales.
- Prepare key documents – Ensure financials and operational records are in order.
- Determine confidentiality levels – Decide how much market visibility you want.
- Showcase your business – Highlight strong occupancy and financial performance.
- Set realistic expectations – Understand market trends and likely timelines.
- Consider your ideal buyer – Ensure a smooth transition for staff and residents.
With the right approach, sellers can capitalize on strong buyer interest while ensuring the continued success of their care home businesses.
Image depicts Rob Kinsman, Regional Director for Care at Christie & Co