Helping clients navigate park home life: Insights for brokers

More and more people across the UK are opting into the residential park home lifestyle. Whether it’s the appeal of a quieter pace of life or the opportunity to free up equity, park home living offers a fresh start. But while the lifestyle has its perks, it also comes with unique considerations – especially when it comes to insurance.

For brokers, understanding the motivations behind this move, as well as the challenges residents might face, is key to offering the right advice and cover.

Our team have worked in the industry for several decades, providing quality cover for park homes to hundreds if not thousands of brokers and their clients. Over the years we have noticed various trends and as park homes are on the rise, we wanted to share.

While our team are not placed to advise directly on all of the areas noted in this article, we wanted to highlight them to brokers who may wish to check any specific legal or regulatory details that could affect their clients.

Who is embracing the park home life?

Although rules will vary between operators, most residential park home sites in the UK have an age restriction of 50 years and over for new residents. This age threshold allows park operators to foster a quieter community that is retirement friendly, where residents share similar lifestyles.

Typically, it includes retirees, “empty nesters”, and people navigating major life transitions such as divorce or bereavement, who may be seeking a fresh start in a more manageable and affordable setting.

From a broker’s perspective, it’s useful to understand these life transitions so you can offer more empathetic and relevant advice. It’s also good to understand the demographic that park homes sites are aimed at so that you can tailor your communications when advising your clients on insurance solutions.

Why would your clients downsize to a park home?

There are many reasons why people are choosing to downsize to a park home. Park homes offer a unique blend of benefits that appeals to a growing number of people across the UK, including:

1. It’s safer - Park home sites are said to have lower crime rates, thanks to on-site security and watchful neighbours.
2. It’s a close-knit community - Residents of park sites often develop strong connections. They participate in organised activities and enjoy living in a more sociable environment.
3. It’s lower maintenance - Smaller homes mean less upkeep. Compared to a traditional property, park homes are much easier to manage and maintain.
4. It’s more accessible - Park homes are single-storey, meaning they are easier to move around – especially as you get older or if you have mobility issues.
5. It’s cheaper - With compact layouts and centralised utilities, residents can often benefit from lower monthly expenses.
6. It can help you free up equity - Downsizing can help release capital that was previously tied up in an old home, meaning residents can enjoy other things they enjoy, like travelling, pursuing hobbies or simply saving for the future.
7. It’s scenic - Many park home sites are situated in lovely, picturesque locations and often go hand in hand with a slower pace of life.
8. It can improve your wellbeing - A tranquil setting, supportive community, less financial stress and crime rates. It makes sense that the move can improve resident’s mental and emotional health. 

Understanding the challenges park homeowners face

Despite the benefits owning a park home can present several challenges that brokers need to be aware of: 

1. Land ownership

Park homes tend to operate in a similar way to how leasehold flats work, meaning residents own their home but not the land it sits on. Because of this, traditional mortgage options are generally not available. Instead of paying for a mortgage, residents pay ongoing pitch fees to the park owner for the right to live on their land. Pitch fees are not static payments and can increase over time. 

Key takeaway for brokers: Ensure your clients are aware of the implications of not owning the land and help them create a plan for long-term costs.

2. Maintenance risks

All park homes should meet the BS3632 construction standards and come with a 10-year structural warranty, ideally. To ensure that these homes are kept up to these standards, regular maintenance is necessary. As a broker, you should take into account the age of the property and the condition when advising your clients. 
One of the downsides for park homeowners and insurers, is getting contractors the access they need to come on site to do repairs. This could result in repairs being delayed and costs increasing.

Key takeaway for brokers:Every site will have different management practices, which can significantly affect the risk involved. Assess each site and evaluate if they are in flood zones, and if they have access issues for contractors.

3. Utility complexities

Typically, all park home utilities are managed by the park rather than individually by residents. And while this can simplify bills and payments, it can also leave questions surrounding responsibility.
For example, if flooding occurs or the roof collapses, who is responsible for the repairs? Is the homeowner or the park owner liable?

As a broker, you should clarify responsibilities to ensure there are no grey areas which might impact the insurance cover. Make sure that your clients know exactly what their policy does and does not cover.

Key takeaway for brokers: Ensure policies cover structural issues, liability disputes between residents and park owners, and loss of use if the home becomes uninhabitable.

4.    Financial considerations

Unlike a traditional bricks-and-mortar home, park homes typically depreciate in value over time. They can also be challenging to resell, due to park rules and limitations on who can buy, which then restricts the potential market. Both of these factors can make purchasing a park home less attractive from an investment perspective.

In order to budget effectively for the long term, it’s important that your clients don’t just focus on the initial purchase, but also factor in pitch fees, maintenance costs, and any potential upgrades to the property. 

Key takeaway for brokers: Some of your clients may not fully understand the limitations of moving into a park home. Help them by explaining their responsibilities and what they can expect from life on a park home site. This will help your clients make more informed decisions.

5.    Rules and restrictions

Park home sites can often have quite specific rules in place that can restrict residents. This can include limitations on home modifications, visitors, and even pets.
It is also worth considering privacy limitations as park homes are typically positioned quite close together which might not suit everyone. 

The majority of park sites often prohibit sub-letting and the park home must be the resident’s primary address and main residence. 

Key takeaway for brokers: As a broker, you should encourage your clients to read the fine print before purchasing.