Care home costs rise to £1,400 a week – your funding options explained

Care home fees now average nearly £1,400 a week, having risen by more than a quarter since 2021-22. 

A report by market researchers Laing Buisson found that rising wages and employer National Insurance costs are driving fees up, with one in seven independent nursing homes charging more than £1,800 a week for new residents. 

Where you live also makes a difference. Fees are highest in London and the South East of England, while those in the Midlands and North of England pay far less. And if you're funding care yourself, you can expect to pay significantly more than council-backed residents.

Here, we take a closer look at what's happening to care home costs and outline some of the funding options currently available. 

Care home fees explained

Care home fees have surged in recent years, but where you live and the level of care you need make a big difference.

Residential care provides help with daily tasks such as washing, dressing and mobility but doesn't include round-the-clock medical support.

Nursing care offers the same support but with 24/7 care from registered nurses, suitable for those with ongoing medical needs or complex conditions.

Laing Buisson compiled the average fees charged by for-profit care homes for older people in 2024-25.

The average nursing care fee in England is £1,372 a week, while residential care averages £1,042 a week.

The table shows the average price that residents in England pay per week, by region: 

• Find out more: care home costs explained 

What's driving the increase in fees?

Care home fees have risen sharply in the past few years, and Laing Buisson attributes the increase to National Living Wage uplifts and inflation.

The report highlights that wage rises in the final years of the Conservative government were a key driver of higher staffing costs.

In 2022-23, high inflation pushed up costs further, adding to financial pressure on care providers.

By 2024-25, national weighted average nursing care fees had risen 27% since 2021-22, while residential care fees were 28% higher.

• Find out more: paying for care at home

Self-funders face higher costs

If you’re paying for care yourself, you’re likely to be charged significantly more than those who receive council funding.

Laing Buisson says councils pay £908 a week on average for residential care, while private residents are charged £1,278 – a £370 difference. For nursing care, councils pay £1,225 a week, compared to £1,594 for private residents – a £369 gap.

At the top end of the scale, private payers who need specialist nursing care face even steeper costs. One in seven nursing homes now charge more than £1,800 a week for these residents.

Report author William Laing explains: 'Local authorities are using their large purchasing power to drive prices down. This hasn’t changed. People are paying more for their nursing and residential care if they pay privately than if their spot is paid for by the local authority.

'This discrepancy between council and private payer prices can’t continue, but it’s difficult to see how it can be resolved. Operating costs will undoubtedly rise, and they’ll need to be covered by someone.'

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Will your council pay your care fees?

More than half of care home residents have their costs at least partially covered by their local council. 

If your assets are below £23,250 in England and Northern Ireland, £28,750 in Scotland, or £50,000 in Wales, your council must contribute to your care fees. However, whether you receive full or partial support depends on your savings and assets. 

Each country has capital limits:

• England and Northern Ireland: the upper limit is £23,250 and the lower limit is £14,250.
• Scotland: £35,000 (upper) and £21,500 (lower).
• Wales: the upper and lower limits are both £50,000, meaning anyone with less than this qualifies for council funding.

If your assets are above the upper limit, you’ll need to pay all of your care costs. If they fall below the lower limit, the council will pay, although you may still contribute from your income (such as a pension).

If your assets fall between the two, you’ll be expected to partly fund your care. You’ll contribute from your income, plus a ‘tariff income’ charge, where you pay £1 a week for every £250 in savings you have between the upper and lower limits.

• Find out more: expert tips on paying for care

What happened to the care cost cap?

Plans to limit how much individuals must pay towards personal care in their lifetime were scrapped in July 2024 after years of delays.

The proposed cap would have set a lifetime limit of £86,000 on personal care costs, including help with eating, dressing and medical assistance.

The plan also included raising the upper capital limit (including property value) you could have while still qualifying for council support, from £23,250 to £100,000 in England. 

The lower capital limit, below which councils cover care costs in full, was set to rise from £14,250 to £20,000.

The reforms would have only applied to England; Scotland, Wales and Northern Ireland set their own rules on care funding.

• Find out more: care cost cap axed

How can you fund care?

There are several ways to cover care home fees, depending on your financial situation and eligibility for support:

Local authority funding

If your assets are less than £23,250 in England and Northern Ireland, £28,750 in Scotland or £50,000 in Wales, your council may cover some or all of your care costs. 

You’ll need to undergo a financial assessment and - in some cases - a relative or friend can contribute extra through a top-up fee.

NHS Continuing Healthcare 

If you have severe ongoing health needs, the NHS may cover the full cost of your care, regardless of your financial situation. 

This is called NHS Continuing Healthcare (CHC), but it’s not automatically granted – you’ll need to meet strict medical criteria through an assessment.

Selling your home

If you own a property, its value will be counted as part of your assets after 12 weeks of living in a care home. At this point, you may need to sell your home to fund care, unless a spouse or dependent still lives there. 

Some councils offer deferred payment schemes, letting you borrow against your home’s value instead.

If you're receiving care at home, your house will not be considered as part of your assets in the funding assessment. 

If you want to unlock some of the value of the home to pay for care while you still live there, you could benefit from equity release – but if you move out to a care home, you'd then need to sell your home to pay back the equity release loan.

• Find out more: equity release explained 

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Investment bonds

Some financial providers offer investment bonds designed for long-term care funding. 

These usually require you to start investing at least 10 years in advance, making them more suitable for early planning rather than immediate care needs.

Annuities

An immediate-needs annuity provides a guaranteed regular income in exchange for an upfront lump sum. 

This can help cover care costs for life, but the risk is that you may pay more than you end up needing.

• Find out more: best annuity rates 2025

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