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| 1 minute read

Is senior housing turning towards a golden era?

The senior housing market is experiencing a robust recovery, surpassing pre-pandemic performance levels, as highlighted in a recent report by Marcus & Millichap. Since spring 2021, over 103,000 units have been absorbed in the sector, more than double the number relinquished during the height of the pandemic. Memory care centers are leading the recovery, with occupancy levels surpassing pre-pandemic highs, and deficits in other senior housing types and continuing care retirement communities (CCRC) are narrowing. Year-over-year rent growth ranges from 6% to 6.7%, approximately double the pre-pandemic pace. Seniors housing has become more affordable than single-family homes, particularly due to the significant increase in mortgage rates over the past 19 months.

However, despite positive projections, the seniors housing sector faces challenges in investment activity and transaction closures. The number of assets changing hands is down about 25% compared to pre-pandemic levels. Development is also hindered by spikes in lending costs, preventing some projects from being financially viable, despite a strong long-term demand outlook. Operationally, staffing remains a concern, with the number of people working in senior housing decreasing by 1.9% since year-end 2019, even as the number of facilities nationally has expanded by 8%. 

Year-over-year rent growth is up between 6% and 6.7% based on type of care, roughly double the pre-pandemic pace.


real estate, senior housing, memory care, ccrc, covid-19, care homes