Key challenges for adult social care in Portsmouth

Portsmouth's adult social care market is relatively easy to misunderstand.

The city is ageing. Care needs are becoming more complex. Care-home occupancy is high. Extra care has a waiting list. Supported living is a strategic priority.

Those facts can make Portsmouth look like a straightforward growth market.

It is not.

The current Market Position Statement shows several very different market conditions operating at the same time.

Standard domiciliary care is oversupplied.

Care-home capacity is tighter, but much of the existing estate is constrained by older buildings.

Extra care has one of the clearest documented shortfalls.

Supported living is preferred for many people with learning disabilities and mental-health needs, but the opportunity depends on the right housing and support model.

The workforce is more stable than in many neighbouring areas, but the services with the strongest demand require specialist skills.

The central challenge for providers is therefore not finding evidence of need.

It is separating real market gaps from areas where supply already exceeds demand.

1. Standard homecare is currently oversupplied

Portsmouth's 2025–27 Market Position Statement is unusually direct.

The Dynamic Purchasing System had 62 providers, with 47 actively supplying care. Most referrals attracted more than one provider response, which supports the council's assessment that ordinary homecare capacity currently exceeds demand.

62

Providers

47

Active providers

Most referrals were receiving multiple offers of care.

The DPS was therefore closed to new providers.

This is a significant market constraint.

A new agency can be perfectly compliant, well staffed and well managed and still struggle to win enough packages if it enters a market with excess capacity.

2. Future homecare growth does not solve today's oversupply

Portsmouth expects homecare demand to rise over time.

The ageing population and the drive to keep people at home are projected to increase commissioned hours significantly.

But future growth and current market entry are different questions.

A provider starting now still needs to compete in today's market.

The business cannot rely on 2030 demand to cover 2026 payroll.

3. Homecare providers are already under viability pressure

The council says existing providers have raised concerns that oversupply is threatening viability.

This is important.

Competition can fragment packages across too many agencies, reducing visit density, paid utilisation, workforce efficiency and margins. Apparent choice for commissioners can therefore coexist with increasingly difficult operating conditions for providers.

A market with many providers can look healthy from the commissioner's perspective while being commercially difficult for individual businesses.

4. The commissioning rate is changing

Portsmouth has also been redesigning how it pays for domiciliary care.

The historic fixed hourly rate was £24.40, while the 2025 decision envisaged market-led prices between £21 and £24.40, with adjustments from 2026/27. Providers should verify the currently applicable mechanism and actual achievable fees rather than treat the previous rate as guaranteed.

This creates further uncertainty for providers.

A business model built around the previous fixed rate may no longer be valid.

5. Quality assurance is becoming more formal

The redesigned domiciliary-care procurement includes stronger use of PAMMS.

Annual monitoring may draw on feedback from people using services, the workforce and providers, alongside responsiveness and wider quality information. This makes demonstrable standards and effective governance important to continued access to commissioned packages.

This raises the competitive bar.

A provider should not treat market access as a one-off tender exercise.

Quality performance will increasingly affect continued access.

6. Complexity is rising even while standard supply is high

Portsmouth says the average domiciliary-care package size has been increasing.

The average package was 17.9 hours per week in the current MPS evidence.

The council links that growth partly to people leaving hospital with more complex needs.

This creates a market tension.

Standard care is oversupplied.

Higher-complexity homecare may still be difficult to deliver.

The opportunity therefore sits in capability, not simply capacity.

7. Homecare providers need to support dementia and multiple conditions

More residents receiving care at home are expected to have dementia, behaviours that challenge, several long-term conditions or higher dependency. The delivery model must therefore extend beyond routine personal care.

This can require closer clinical liaison, robust medication processes, behavioural support, safeguarding, supervision and continuity from staff familiar with each person's needs. These capabilities must be built into costs and rotas.

8. Extra-care supply is significantly below projected need

Portsmouth has four extra-care schemes with 243 units.

The council has nomination rights to 211.

In September 2025 there were no vacancies in those units and a waiting list of 10.

243

Apartments

211

With council nomination rights

10

People on the waiting list

The long-term model shows a much larger shortfall.

After adjusting for sheltered-housing capacity, the council estimates a need for around 400 affordable extra-care units by 2030.

That is materially above current nominated supply.

9. Extra care has high barriers to entry

The demand signal is strong.

The development challenge is equally strong.

A scheme depends on a viable site and planning consent, significant capital, housing and landlord expertise, commissioning arrangements and sustainable long-term operation. The strong demand signal does not make extra care as straightforward to launch as a small domiciliary-care service.

A standard care provider cannot simply decide to "open extra care" in the same way it might launch a homecare agency.

10. Affordable extra care is different from retirement housing

Portsmouth's message is specifically about affordable extra care.

Premium retirement flats, luxury later-living schemes or housing without an adequate care model do not necessarily address the council's requirement. Portsmouth is seeking affordable provision suitable for residents with support needs and potentially public-sector funding.

The council wants schemes that can serve people who need care and may rely on publicly supported housing and care arrangements.

11. Care-home occupancy is high

Portsmouth reports care-home occupancy generally between 93% and 95%.

• 93%Lower end of the range
• 95%Upper end of the range

That is a strong indicator of utilisation.

It also reduces flexibility.

When occupancy is consistently high, finding the right bed quickly becomes more difficult.

A vacancy may be unusable when the resident needs nursing, advanced dementia support, suitable bariatric equipment, specialist behavioural care or a particular location. High occupancy compounds that difficulty, so headline beds alone cannot establish local sufficiency.

A city can have nominal beds available but still lack suitable capacity.

12. Portsmouth has fewer care-home beds per population than neighbouring areas

The council says Portsmouth has materially fewer residential and nursing beds per 1,000 residents than neighbouring authorities.

Portsmouth has 507 registered residential beds and 461 nursing beds, relatively little provision for its population compared with nearby authorities. The limitation is more pronounced when the suitability of older premises for complex care is taken into account.

507

Registered residential beds

461

Registered nursing beds

That creates a stronger supply pressure than in homecare.

But bed numbers alone still do not define the opportunity.

13. Much of the care-home estate is physically constrained

Many care homes operate from converted Victorian properties.

Converted Victorian buildings may have narrow corridors, limited ground-floor access and difficulty accommodating large equipment or people requiring bariatric care. A registered bed in an unsuitable environment may not be viable for the higher-acuity residents increasingly needing support.

As care needs increase, building design becomes part of service capability.

A nominally available bed may not be operationally suitable.

14. People are entering care homes with higher acuity

Portsmouth says residents are entering care homes later.

Their needs are more complex.

Residents may require support with catheter management, insulin administration or PEG feeding. These tasks demand clear competencies, appropriate clinical delegation and oversight, putting more pressure on recruitment and governance.

This creates a workforce and governance challenge.

The market may require more nursing capability even where the service is not formally a nursing home.

15. Nursing demand is expected to increase

Portsmouth's planning model projects nursing placement requirements rising from approximately 124 in 2025 to 153 in 2030, 174 in 2035 and 185 in 2040. These are projections rather than confirmed future purchases, but they indicate the type of capacity that warrants further investigation.

124

2025

153

2030

174

2035

185

2040

These are planning projections rather than guaranteed placements.

But the direction is clear.

Nursing is one of the stronger future growth areas.

16. Developing new care homes is economically difficult

The council explicitly recognises that new residential and nursing developments are hard to make viable in Portsmouth.

Portsmouth's compact, densely developed urban geography leaves relatively few larger sites and raises construction costs. New care-home provision must reconcile planning, capital and property requirements with achievable commissioning fees, even where demand appears clear.

This means a clear demand gap can exist without an easy development solution.

17. Portsmouth has relatively limited self-funding power

The Market Position Statement notes that deprivation reduces the number of self-funders compared with some neighbouring areas.

That affects the economics of new care-home development.

A premium private-pay model may have a smaller addressable market than in affluent parts of Hampshire or Surrey.

Public-sector fee assumptions therefore matter more.

18. Other councils also use Portsmouth care-home beds

Portsmouth highlights another constraint: beds are sometimes spot- or block-purchased by neighbouring local authorities.

That means local supply does not serve only Portsmouth residents.

A new home may attract demand from outside the city.

For Portsmouth commissioners, however, external purchasing can reduce the capacity available locally.

19. Under-65 residential need is becoming more visible

Many Portsmouth care homes are registered primarily for people aged 65 and over.

The council reports increasing admissions of people under 65 who need residential care.

Younger adults may need specialist support related to neurodivergence, mental-health conditions, physical disability, substance misuse or behaviours that challenge. Such needs may not fit standard older-person residential environments or their staffing models.

A standard older-person home may not be suitable.

20. Supported living is preferred for learning disability

Portsmouth has already shifted substantially away from residential care for people with learning disabilities.

Existing provision includes 272 people in supported living, 22 using Shared Lives and 34 living in residential or nursing care. These figures reflect the council's direction toward personalised, community-based services where that approach meets individual needs.

272

People in supported living

22

Using Shared Lives

34

In residential or nursing care

The policy direction is clear.

New provision should generally support independence rather than recreate institutional models.

21. Fifty-five learning-disability placements remain out of city

Portsmouth reports 55 people with learning disabilities living outside the city.

Not every placement should be repatriated.

Some people are placed outside Portsmouth through personal choice, specialist need or legal considerations. Others may have needs that suitable local supported living could address. Providers need to distinguish between these groups before counting an out-of-city placement as potential demand.

But the number demonstrates that local capacity does not meet every need.

Providers should investigate which cohorts commissioners actually want to support locally.

22. Supported-living property design is a major constraint

A scheme must be small enough to support independence and avoid institutionalisation, yet sufficiently viable to staff. It should provide personal space and meaningful access to community life.

This is a difficult balance.

Property choice also needs to reflect the compatibility and risks of future residents, the staffing model and its surrounding environment. An available six-bedroom house is not automatically a suitable supported-living service.

23. Learning-disability respite does not suit everyone

Current short-break provision includes Russets, a small independent service, Shared Lives and personal assistants.

The existing mixture of Russets, limited independent residential provision, Shared Lives and personal-assistant support may not suit people with high complexity, sensory or environmental sensitivities, or needs that affect other residents. This points to demand for more carefully designed specialist short breaks.

That creates a specific respite gap.

But it is a specialist one.

24. Day services are being pushed toward outcomes

Portsmouth is redesigning day opportunities.

The intention is to support employment, participation in community life, skills, social enterprise and independence rather than simply attendance at day centres. That creates a different performance expectation for providers considering community opportunities.

Providers that simply replicate traditional building-based day care may be less aligned with future commissioning.

25. Mental-health residential care has limited growth potential

This is another area where the headline need can be misleading.

Portsmouth says current residential capacity for highly complex mental-health needs is broadly sufficient.

Some providers experience high void levels.

That is negative evidence for a generic mental-health care-home business case.

26. Mental-health supported living has a stronger direction

The council wants more flexible accommodation, timely hospital step-down, recovery-focused support, social inclusion and housing suitable for higher needs. This is a stronger signal for suitably designed supported living than generic mental-health residential capacity.

This is a stronger market signal than residential care.

27. The housing specification is unusually detailed

Portsmouth's current MPS sets out the type of mental-health accommodation it wants.

The published brief includes self-contained flats in the same block, shared accommodation for people needing more intensive support, staff sleep-in space, accessible and safe layouts, separate step-down options and usable outside space. Transport links and locations within PO1–PO6 are also important. These constraints make the property specification part of the commissioning case.

When a council specifies property characteristics this precisely, it signals that the gap is not merely support hours.

It is suitable accommodation.

28. Void risk remains real in specialist housing

Portsmouth also warns that larger mental-health schemes may be difficult to fill.

Its current view is that more than six units may create a higher void risk unless the property can be subdivided.

This is commercially important.

A specialist need can be genuine while a large scheme remains financially risky.

29. Workforce numbers look good but capability remains the issue

Skills for Care estimates around 5,000 adult social care posts, with 4,800 filled and 200 vacant. Low headline vacancy and turnover rates of 4.1% and 17.8% are encouraging, but they say little about the availability of specialist staff.

• 4.1%Vacancy
• 17.8%Turnover

5,000

Adult social care posts

4,800

Filled

200

Vacant

The 4.1% vacancy rate and 17.8% turnover rate are both comparatively low.

That is positive.

But the market gaps require workers with more specialist skills.

30. Nursing recruitment can still constrain growth

Portsmouth's care-home market increasingly needs clinical capability.

An operator planning nursing or other high-acuity care must establish the supply of nurses, overnight coverage, expected agency reliance, clinical leadership and staff competencies. A favourable city-wide vacancy rate does not remove these operating risks.

The overall labour market does not answer those questions.

31. Portsmouth's compact geography intensifies competition

The city covers only around 40 square kilometres.

Three quarters of the population lives on Portsea Island.

This helps homecare providers build efficient rounds.

It also means many agencies compete in the same small operating area.

Geographic efficiency is therefore both an advantage and a reason for oversupply.

32. Hospital discharge increases complexity

Portsmouth plays a major role in the wider urgent-care pathway.

People increasingly leave hospital when medically optimised rather than fully recovered.

That means community providers are supporting higher needs.

Providers able to mobilise rapidly, coordinate with NHS teams, respond as conditions change and support reablement may align more closely with Home First pathways than a service built entirely around predictable long-term rounds.

33. Reablement is central to commissioning

The council wants providers to support people to regain independence wherever possible.

This means success is not always measured by how many care hours remain in place.

A provider may be expected to help reduce the package over time where appropriate.

That changes the economics of outcome-focused care.

34. Technology will increasingly affect delivery

The council encourages care technology, virtual visits, remote prompts and monitoring to support independence and operational efficiency. Providers will still need to show that each intervention is appropriate, accessible and integrated with safe human support.

This can improve productivity and independence.

But providers need to understand when technology substitutes for a visit and when it cannot.

A business based entirely on commissioned physical visits may need to adapt.

35. Procurement access is becoming more important

Portsmouth is moving several markets toward more structured commissioning.

Domiciliary care is being recommissioned.

Residential and nursing care may move onto a framework or other procurement vehicle.

Supported-living and mental-health accommodation opportunities are also expected to be tendered.

A provider should therefore research procurement before registration.

What do these challenges mean for a new provider?

Portsmouth has genuine opportunities.

They are highly specific.

Stronger propositions

Better-supported propositions include affordable extra care, more complex domiciliary and nursing care, accessible purpose-built residential services, specialist learning-disability supported living, mental-health accommodation, respite and day opportunities measured by independence and outcomes. These markets have different property, workforce and commissioning barriers.

Weaker propositions

The evidence is weaker for generic homecare in an oversupplied market, undifferentiated mental-health residential provision, large specialist housing schemes without verified referral volume or premium private models dependent on substantial local self-funding. A specific unmet need is a better starting point than a broad sector category.

If one of these pressures is close to the service you are considering, the Should I Start? Market Report can test your specific plan in Portsmouth against the same local demand, supply and commissioning evidence rather than relying on the headline market picture alone.

Questions to answer before entering the Portsmouth care market

A prospective provider should be able to answer:

1. Does current supply already exceed demand?
2. Is the opportunity driven by complexity, housing or total capacity?
3. Which commissioning route applies?
4. Is the relevant procurement route open?
5. Who is the payer?
6. Is the service viable at realistic public-sector rates?
7. Does the property match the client group?
8. Can specialist staff be recruited?
9. Is there enough referral volume to avoid voids?
10. Does the model support reablement and independence?
11. Can technology improve the model?
12. Will the service integrate with health and neighbourhood teams?
13. What existing providers already serve the need?
14. What evidence would cause the provider not to proceed?

If the local market case looks strong enough to proceed and you are moving towards CQC registration, you can get a proposal comparing specially selected and verified CQC registration specialists for the service you plan to register.