Published 26 June 2026. Analysis by Jacob Whitmore. Free to cite with attribution.
A self-funded residential care place in the UK now costs an average of £1,298 a week, or £67,496 a year. To work out what care really costs families in 2026, we combined the latest regional fee data with the official means-test thresholds, benefit rates and average house prices. The figures show wide regional gaps and a state safety net that meets only a small share of the bill.
Seven things our analysis found
- Care now costs more than the average salary. The average self-funded residential place runs to £67,496 a year and nursing care to £79,820, before any dementia premium. Full dementia nursing care averages £81,328 a year.
- There is a postcode penalty worth about £25,000. The same nursing care costs £1,759 a week in London against £1,264 in the North East. That 39% gap adds up to £25,740 a year for identical care, and residential fees show the same spread.
- The state pension barely touches the bill. The full new State Pension of £230.25 a week covers just 17.7% of an average residential placement. The remaining £1,068 a week, close to £55,500 a year, has to come from savings, property or other income.
- The average home buys roughly four years of care. At £270,080, the average UK house funds about 4.0 years of residential care, 3.4 years of nursing care or 3.3 years of dementia nursing care. After that the means test takes over.
- Home care is cheaper, but only up to a point. At the £32.14 an hour benchmark rate, a care home works out cheaper once someone needs more than about 40 hours of home care a week, or roughly 5.8 hours a day. Below that, staying at home usually costs less.
- Self-funders subsidise everyone else. The Competition and Markets Authority found self-funders pay around 40% more than councils for the same bed, which works out at roughly £10,000 to £19,000 a year per resident.
- Fees are rising far faster than inflation. Self-funder fees jumped 10% in a single year, adding about £6,750 to the annual bill. The main causes were the rise in employer National Insurance, from 13.8% to 15%, and successive minimum-wage increases.
The Cost of Care Index, by region
We indexed each region’s self-funder residential fee against the UK average, which we set at 100. An index of 119 means care there costs 19% more than the national average. London and Scotland top the table at 119, while the North East (86) and North West (88) are the most affordable places to fund a care home.
| Region | Residential /wk | Nursing /wk | Dementia nursing /wk | Index | Residential /yr |
|---|---|---|---|---|---|
| London | £1,548 | £1,759 | £1,767 | 119 | £80,496 |
| Scotland | £1,539 | £1,646 | £1,656 | 119 | £80,028 |
| South East England | £1,446 | £1,706 | £1,721 | 111 | £75,192 |
| East of England | £1,359 | £1,606 | £1,573 | 105 | £70,668 |
| South West England | £1,339 | £1,595 | £1,627 | 103 | £69,628 |
| UK average | £1,298 | £1,535 | £1,564 | 100 | £67,496 |
| West Midlands | £1,202 | £1,426 | £1,453 | 93 | £62,504 |
| East Midlands | £1,197 | £1,380 | £1,415 | 92 | £62,244 |
| Yorkshire & The Humber | £1,170 | £1,422 | £1,462 | 90 | £60,840 |
| Wales | £1,156 | £1,394 | £1,440 | 89 | £60,112 |
| North West England | £1,143 | £1,422 | £1,470 | 88 | £59,436 |
| North East England | £1,112 | £1,264 | £1,296 | 86 | £57,824 |
Annual self-funder cost by care type (UK average)
What the state actually pays
Support depends heavily on where you live, and the thresholds have not kept pace with fees. In England and Northern Ireland you must fund your own care in full once your assets pass £23,250. In Scotland the upper limit is £35,000, and in Wales a single £50,000 threshold applies. The proposed £86,000 lifetime cap on care costs was scrapped in July 2024, so there is currently no ceiling on what a self-funder can pay.
A few payments are available regardless of savings. Attendance Allowance is worth up to £114.60 a week. NHS-funded Nursing Care in England pays £254.06 a week, rising to £267.68 from April 2026. Scotland’s free personal care payment is £254.60 a week, with a further £114.55 if nursing is needed, and Wales pays a nursing care contribution of £221.80 a week. Even at their most generous, these payments cover only a fraction of a typical bill.
Who pays, and why fees keep climbing
About 137,480 care-home residents in England, or 37%, fund themselves entirely, and the share rises to almost half (48.9%) in homes for older people, according to the Office for National Statistics. Because councils pay providers less than the true cost of a placement, those self-funders end up subsidising state-funded residents in the same home. In cash terms, that is what the Competition and Markets Authority meant when it found self-funders paying around 40% more.
The 10% jump in self-funder fees over 2025 came from real cost pressure on providers. The employer National Insurance rate rose from 13.8% to 15% in April 2025, which the Nuffield Trust estimates added £940 million to English care homes’ costs. On top of that came back-to-back rises in the National Living Wage, with another increase due in April 2026.
The cap is gone, and that changes everything
Start with the fact that reframes the whole subject. In 2021 the government announced an £86,000 lifetime cap on what anyone would pay for care, along with a rise in the capital limit to £100,000. Families planned around it. Then in July 2024 the incoming government cancelled both. As things stand in 2026, there is no upper limit on care costs in England at all. If you need years of care, there is nothing in the system that stops it consuming most of what you have.
The lifetime cap that was supposed to stop care from taking everything was scrapped in 2024. There is no ceiling now. You are the ceiling.
That sounds bleak, and financially it is. But it makes the case for learning the rules early far stronger, because the difference between a family that knows the funding routes and one that does not can run into six figures over the length of a care journey.
The means test, in plain numbers
England runs on two capital thresholds that have not moved since 2010. Above £23,250 in assessable capital you pay for your own care in full. Below £14,250 your capital is ignored, and the council assesses you on income alone. In the band between, you are charged £1 a week of assumed “tariff income” for every £250 of capital. That is the whole architecture, and it is worth knowing precisely, because a lot of anxious decisions are made by people who assume they are self-funders when a proper assessment would show otherwise.
One thing the numbers hide: this is England. Scotland provides free personal and nursing care through fixed weekly payments, and Wales caps what you pay for care at home and uses a much higher capital limit for residential care. Where you live changes the sums enormously, so never take an England figure as the last word if you are north of the border or in Wales.
You very often do not have to sell the house
Here is the belief that causes the most needless panic and the most rushed sales. Your home is not counted in the means test at all if a spouse, a partner, or a dependent relative still lives in it. And even when a house would otherwise have to be sold to fund a care home, you can ask the council for a Deferred Payment Agreement, which lets the fees be settled from your estate later instead of forcing a sale while you are alive. It is not automatic and it is not free of interest, but it exists precisely so that nobody has to sell the family home in a hurry during a crisis.
Before you sell anything, get the free needs assessment and ask about a Deferred Payment Agreement. The house does not have to go while you are still living.
The three levers almost everyone misses
If the index has one job, it is to point you at these before the money starts moving.
First, the needs assessment. Everyone is entitled to a free care needs assessment from their local authority, whatever their savings, and it is the gateway to almost everything else. Skipping it, or paying privately without ever having one, is how people miss support they were owed.
Second, Attendance Allowance. This is worth around £110 a week at the higher rate, it is paid to people over State Pension age who need help with daily living, and crucially it is not means-tested. You can have a house and savings and still claim it. It is one of the most under-claimed benefits in the country, and for a self-funder it is money straight off the cost of care.
Third, NHS Continuing Healthcare. If someone’s need is primarily a health need rather than a social one, the NHS pays the entire cost of their care, fees and accommodation and nursing included, regardless of how much capital they have. Around 60,000 people in England receive it. It is deliberately hard to qualify for and easy to be steered away from, and it is worth fighting for, because it is the difference between paying everything and paying nothing.
The one rule this index gives you
Do the paperwork before the panic. Get the free needs assessment, claim Attendance Allowance the moment daily living gets hard, and ask the hard question about NHS Continuing Healthcare if health needs are involved. Understand where you sit against the £23,250 line before you assume you are on your own, and ask about a Deferred Payment Agreement before anyone mentions selling a house. The care itself matters enormously, but the funding is where families win or lose the most money, and the rules reward only the people who learned them in time.
Cite this study
This research is free to reproduce for editorial and educational use, with a credit and link to lookinto.co.uk. Suggested citation:
lookinto.co.uk Research (2026), The UK Cost of Care Index 2026. https://lookinto.co.uk/care/uk-cost-of-care-index/
Journalists and researchers: for the full regional dataset or a comment, contact us through the site. Figures may be quoted directly.
Methodology and sources
The Cost of Care Index brings together publicly available data in a single comparative framework. We did not run a survey or collect new fee data. The underlying weekly fees are sourced and dated below, and all index values, annual figures and ratios were calculated by lookinto.co.uk Research.
- Weekly care fees, UK and regional, self-funder basis: carehome.co.uk, dated 9 September 2025.
- Index calculation: each region’s residential fee divided by the UK average (£1,298), times 100. Annual figures are the weekly fee times 52.
- Means-test thresholds, Personal Expenses Allowance and the cap: GOV.UK Local Authority Circular on charging for care 2025 to 2026, Care Information Scotland, and GOV.WALES.
- Attendance Allowance and State Pension rates for 2025/26: DWP and GOV.UK.
- NHS-funded Nursing Care and devolved care payments: NHS England, mygov.scot and Age Cymru.
- Home-care hourly benchmark of £32.14: Homecare Association Minimum Price for Homecare, England 2025/26.
- Self-funder population: ONS, Care homes and estimating the self-funding population, England.
- The 40% cross-subsidy figure: Competition and Markets Authority care homes market study.
- Average UK house price of £270,080: HM Land Registry UK House Price Index.
- Year-on-year fee rise and cost drivers: carehome.co.uk Caring Britain report and the Nuffield Trust.
Figures are averages and will vary by provider, individual need and exact location. This page is general information, not financial or legal advice. Last updated 26 June 2026.
Frequently asked questions
- What is the average cost of a care home in the UK in 2026?
- The average self-funded residential care home costs £1,298 a week, or £67,496 a year, and nursing care costs £1,535 a week, or £79,820 a year. Dementia nursing care averages £1,564 a week, which is £81,328 a year.
- Which region has the most expensive care homes?
- London and Scotland are the most expensive, both about 19% above the UK average. The North East is the most affordable, at roughly 14% below average. The gap between the dearest and cheapest region is about 39%, worth up to £25,740 a year for the same nursing care.
- How much can you have in savings before you pay for care?
- In England and Northern Ireland you fund your own care in full above £23,250 in assets. In Scotland the upper limit is £35,000 and in Wales it is £50,000. There is currently no lifetime cap on care costs, as the planned £86,000 cap was scrapped in July 2024.
- Does the state pension cover care home fees?
- No. The full new State Pension, £230.25 a week in 2025/26, covers only about 17.7% of an average residential care bill. That leaves roughly £55,500 a year to be met from other income, savings or property.
- Is home care cheaper than a care home?
- Usually, up to a point. At the £32.14 an hour benchmark rate, residential care becomes cheaper once you need more than about 40 hours of home care a week, or around 5.8 hours a day.
Sources: carehome.co.uk care home costs (Sept 2025 data); GOV.UK charging for care 2025/26; Homecare Association minimum price 2025/26; ONS self-funding population; HM Land Registry UK House Price Index.