As you might expect of a Stockholm suburb on a Sunday, not very much is happening in Gärdet. Despite its staunchly liberal values Sweden is a Christian country, and the shops and cafés near the station are almost aggressively shut. Aside from one elderly man puffing on a pipe, the streets are empty. An expanse of identikit 80s apartment block screams “Nordic noir” but doesn’t so much as whisper “gay”. Certainly there is nothing to suggest that this is the setting of Europe’s first LGBT retirement community.

“People want security in old age,” says Christer Fällman, 55, the chairman and youngest resident of the Regnbågen (rainbow) housing project. “They want closeness to other people, and not to be so lonely.”

The warmth and liveliness in the common room of the Regnbågen block is certainly a contrast to the reserved scene outside. In spite of being immaculately clean, it feels lived in. The white walls are dotted with paintings and, in one corner, a rainbow-coloured kite stands as a small “here be gays” reminder.

Before Regnbågen opened, the demand for LGBT senior housing had already been recognised outside Europe, with homes existing in the US, Canada and Australia. A gay retirement village is due to open in Sallèles-d’Aude, in the south of France, next spring, and it seems likely that other European nations will follow suit. What lies behind this surge in accommodation for elderly LGBT people?

Studies have shown that retirement home residents are reluctant to open up about their sexuality. A report by Stonewall showed that older gay and bisexual people in the UK are much more likely than their hetero counterparts to live alone and to lack family support. The charity found that older gay men are three times more likely to be single than straight men, and that 41% of elderly LGBT people live alone.

Caroline Abrahams, charity director of Age UK, said that there is cause for concern over mistreatment of older LGBT people in the care system. “We are worried about a hidden minority of residents who may be experiencing homophobic care,” she says. “Our concern is that some older people will feel they have to hide who they are because they are scared of how people will react.”

In the Regnbågen common room, Fällman sips coffee and explains how this wonderful anomaly of a community came to be. The idea came to him in 2009, at a conference on care for the elderly held during Stockholm Pride. With no money and a fairly utopian vision, Fällman set about building a great concrete nest for elderly gay Swedes. Through his background in social care and links to Stockholm council, he found funding and the project gathered momentum. Regnbågen finally opened in November last year and now has around 100 residents from all over Sweden and even other European countries. Residents are, on average, in their mid- to late 60s, but the oldest are in their 80s. Each has a private apartment, along with use of a common room and roof terrace. The community has attracted so much interest that there is a waiting list of 60. The home has even started a trend. The city council is now receiving requests from elderly firemen and policemen for their own dedicated housing communities.

A place to call home: Regnbågen founder Christer Fällman, 55, is also its youngest resident. Photograph: Johanna Frenkel for the Observer. Photograph: Johanna Frenkel/Observer

But why are older LGBT people so keen to surround themselves with fellow non-straights?

“People our age are a little afraid to get back in the closet,” says Björn Lundstedt, 73. Lundstedt, a former commercial pilot, says he is reluctant to assimilate with the predominantly heterosexual lifestyle expected of people from his generation. Like many other Regnbågen residents, he was born in the 40s, when homosexuality was illegal in Sweden. Although gay sex was legalised by the Swedish government in 1944 (23 years before the UK followed suit), homosexuality remained classified as a mental illness until the late 70s. It’s understandable that having lived through so much discrimination, gay people of Lundstedt’s age are wary of entering a care system largely inhabited by old heterosexuals.

But, in the open-minded Sweden of 2014, is homophobia still a common problem for the elderly? Lars Mononen, 64, seems to think not. For him, LGBT elderly care is more about a sense of community and belonging than escaping bigotry. “Sweden is a very inclusive and tolerant society,” says Mononen. “It’s about sharing common values and understanding each other’s backgrounds.” Mononen speaks with a nervous energy and has an Alec Baldwin-esque glint in his blue eyes.

“I’m not entirely sure if that’s true,” interjects Björn Gate, 72. Gate, bearded and thoughtful, speaks about an “invisible discrimination” that pervades even this most liberal of nations. According to Gate, homosexuality is often accepted but not understood. And, as is the case for many elderly people in care, to be surrounded by those who tolerate you but find your sexuality eccentric at best, abnormal at worst, must be an isolating experience. The same is true of those from religious or ethnic minorities, argues Gate. When these people reach old age, they’re in danger of losing their culture and identity to assimilation.

Cultural isolation is something that many Regnbågen inhabitants have known. Most residents, Fällman explains, grew up with a sense of shame. He was brought up in a small town about 600km north of Stockholm. As a teenager, he dreamed of becoming a figure skater. “But I wasn’t allowed. That was for girls.” When his parents discovered that he was gay, they took him to a doctor. “They wanted to heal me,” he says.

Lundstedt’s experience of coming out was similarly gruelling. He was 20, and although his mother (who claimed she had known all along) said that she would love him no matter what, his father sought medical attention for his “condition”. One doctor’s words are permanently etched onto Lundstedt’s memory. “He said, ‘If you can’t do what your parents want, isn’t it better to castrate yourself?’”

Thankfully, his father was intelligent enough to ignore that advice. But he still couldn’t accept that his son was gay. “I never got the love that I wanted from my father,” he says. When he came out to his younger brother it was a different story. “He has always been there for me,” says Lundstedt.

Remembering their past is clearly vital to particular Regnbågen residents. “We have an important job to do,” says Fällman, “to reach out to young people and tell them about our history.” The community welcomes visits from schools and universities, and some members are keen to share their stories. In taking on this responsibility, the collective is setting itself up as a sort of living museum of gay history.

The stories aren’t all sad. Gate explains that while he was bullied a little at school, he never faced prejudice from those closest to him. He came out to his mother when he was about 18. A few weeks later, he was approached by his father. “He patted me on the shoulder and said, ‘Let’s go for a walk, Björn.’” Gate says that his father, although he didn’t truly understand his sexuality, supported him. “He said: ‘The only thing I understand is that I’m always behind you and I will always love you, and I’m proud of you as my son.’” Gate recognises that, even today, many young people’s experiences of coming out aren’t as easy as his was, more than 50 years ago.

Similarly, Mononen’s family never had trouble accepting his sexuality. As a young man, he had boyfriends. “Then I met a girl,” he says, “And she…” “Hooked you,” Fällman cuts in. Both men laugh. So for 12 years, Mononen was happily married to a woman. They had three children and he worked for Volvo. In many ways, he did the “typical Swedish man” thing for a bit. Is he bisexual? Perhaps. But he’s only interested in men for now. Whichever way, his brothers and sisters are behind him.

Personal histories aside, what is life like at Regnbågen? “People who have moved here say: ‘Finally, I’m at home,’” says Monomen. The room resounds with agreement. Although around 70% of the residents are men, backgrounds and sexualities are mixed. Fällman says that it was always his aim for those on average pensions to be able to afford the rent. There are only a handful of couples, and so far no romantic relationships have formed. But there is plenty of flirting. “If you walk the corridors at night, you will see a lot of exciting things,” jokes Mononen. On Saturday mornings, residents gather for coffee in the common room. One of the women has started a knitting circle. In many ways, Regnbågen is a typical retirement community.

While most of the women in the complex chose not to speak to me, I did have an email conversation with one of them, who preferred not to be named. She told me that before moving into Regnbågen, she was very quiet about her sexuality. She joined the community in an effort to “restart” her life – a brave step at 69. “We are from different walks of life,” she says. “Coming to Regnbågen has brought us together.”