The survey found 48,000 people currently living in care homes in 2009 were forced to sell their homes to pay for long-term care, 3,000 more people year-on-year.
This represent 31 per cent of the 155,000 self-funders who are currently in residential care.
Since 2005 the number of people in care who have been forced to sell their homes has increased 23 per cent, an extra 9,000 people, the survey shows.
Lib Dem shadow health secretary Norman Lamb says: “This Government’s treatment of older people is its shameful legacy. Ministers have turned their backs on thousands of older people who are forced to sell their homes each year to pay for the costs of care.
“The recent Social Care Green paper was the perfect opportunity to sort this problem out, but yet again Labour has kicked this issue into the long grass.”
Lamb says a complete overhaul of the current “unfair” system is needed so that people’s homes are no longer considered fair game to cover care bills.
He adds: “Whoever wins the next election cannot avoid the fact that we’re facing a crisis in funding for care. What we need is a long-term solution where the state pays its fair share and individuals are encouraged to save for later life.”