News & Press Releases
Release: Seniors Housing Rent Growth Continues to Accelerate
Seniors Housing Rent Growth Continues to Accelerate
NIC MAP Data Also Shows Stable Occupancy Rates
FOR IMMEDIATE RELEASE: July 27, 2011
Contact: Renee Tilton, (410) 626-0805 or rtilton@crosbymarketing.com
Annapolis, Md. – The pace of rent growth for seniors housing continued to increase in the second quarter of 2011, while occupancy rates remained the same as the previous quarter, according to NIC MAP, a data analysis service of the National Investment Center for the Seniors Housing & Care Industry (NIC).
Overall, the average occupancy rate for seniors housing properties in 2Q11 was 88.0%, identical to that in 1Q11. The seniors housing occupancy rate is up 0.5 percentage points from 2Q10 and up 0.7 percentage points from its cyclical low of 87.3% in 1Q10.
The occupancy rate for independent living properties in 2Q11 was 87.7%, and the occupancy rate for assisted living properties was 88.5%. These are essentially unchanged from the 1Q11 occupancy rates of 87.7% and 88.4%, respectively. Independent living occupancy is 0.6 percentage points higher than its cyclical low of 87.1% in 1Q10, while assisted living occupancy is at its highest level since 3Q08 when it was 88.8%. “While occupancy rates are currently trending sideways, they have moved from beyond their recent cyclical lows,” says Charles Harry, director of research & analysis, NIC.
Year-over-year rent growth for seniors housing increased to 1.4%, from 0.9% in 1Q11 and 1.2% in the second quarter of 2010. “This annual pace of rent growth is the highest we’ve seen in the past five quarters, and is on par with core inflation for this same time period,” says Harry.
For seniors housing properties, annual absorption was 1.6% in the second quarter of 2011, compared to 2.1% in 1Q11 and 1.9% a year ago. “Absorption remains positive, but it is reflecting the continuing softness in both the economy and the housing market,” says Harry.
In 2Q11, seniors housing annual inventory growth was 1.1%, which is down from 1.3% in 1Q11 and 2.1% in 2Q10. This is the lowest level seen in the current market cycle. The construction vs. inventory level for seniors housing remained unchanged from the previous quarter at 1.9%.
The nursing care occupancy rate also remains stable at 88.4% in 2Q11, only a slight decrease from 88.5% in 1Q11. This stability has been reported since 2Q10 in this sector.
Nursing care annual inventory growth was -0.1% in 2Q11, illustrating the established trend of slightly declining inventory growth. Private pay rents annual pace for this sector grew 3.3% this quarter, which is the same increase reported in the first quarter of 2011.
About NIC
For 20 years, the National Investment Center for the Seniors Housing & Care Industry (NIC) has been committed to advancing the quality of seniors housing and care by facilitating informed investment decisions for investors, lenders, owners, operators and developers through groundbreaking research, actionable data and dealmaking events. NIC is the leading provider of historical and trend data on the industry through its NIC MAP® Data and Analysis Service that tracks more than 12,000 properties on a quarterly basis in the 100 largest metropolitan markets. Proceeds from its annual conference and other events are used to fund data and research on issues of importance to lenders, investors, developers, operators, and others interested in meeting the housing and care needs of America’s seniors. For more information, visit www.NIC.org or call (410) 267-0504.