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Seniors Housing Actual Rates Report Shows Larger Discounts for Assisted Living than for Independent Living Properties

The NIC Map Data Service recently released national benchmark data through year-end 2016 for actual rates and leasing velocity.  Key takeaways include:

  • Average initial rates were below average asking rates for both independent living and assisted living properties, with monthly spreads larger for assisted living properties throughout the entire reported period.

  • As of December 2016, assisted living initial rates averaged 10.7% below the average asking rate, which equates on an annualized basis to an average initial rate discount equivalent to nearly 1.3 months. The discount for independent living was smaller at less than half a month rent.
  • Average initial rates for independent living properties have been trending higher for the past 12 months, and in December, were 2.9% above year-earlier levels. This was more than the 2.5% increase seen in average asking rates for independent living. While assisted living average asking rates also continued to climb, average initial rates for assisted living were 1.2% below year-earlier levels.
  • Average in-place rates exceeded average initial rates for assisted living in every month of the past year, and were 6.2% higher on average. In-place rates were also higher on average for independent living properties, but the differences were smaller than for assisted living at 2.0% for the past twelve months.
  • The pace of move-outs continues to be greater for assisted living than independent living. This demonstrates that resident turnover continues to be greater within assisted living properties than independent living properties. Move-outs have exceeded move-ins for six of the past twelve months for assisted living and five months for independent living.

The NIC MAP Seniors Housing Actual Rates Report provides national data from approximately 250,000 units within more than 2,500 properties across the U.S. operated by 15 to 20 seniors housing providers. This monthly time series is comprised of end-of-month data for each respective month.

About the Author

Beth Burnham Mace

Beth Burnham Mace is the Chief Economist and Director of Outreach at the National Investment Center for Seniors Housing & Care (NIC). Prior to joining the staff at NIC, she served as a member of the NIC Board of Directors for seven years and chaired NIC’s Research Committee. Ms. Mace was also a Director at AEW Capital Management and worked in the AEW Research Group for 17 years. Prior to joining AEW in 1997, Ms. Mace spent ten years at Standard & Poor’s DRI/McGraw-Hill as the Director of the Regional Information Service. She also worked as a Regional Economist at Crocker Bank, the National Commission on Air Quality, the Brookings Institution and Boston Edison.

Ms. Mace is a member of the National Association of Business Economists (NABE), the Urban Land Institute (ULI), ULI’s Senior Housing Council and New England Women in Real Estate (NEWIRE/CREW). In 2014, she was appointed a fellow at the Homer Hoyt Institute and was awarded the title of a “Woman of Influence” in commercial real estate by Real Estate Forum Magazine and Globe Street. Ms. Mace is a graduate of Mount Holyoke College (B.A.) and the University of California (M.S.). She has also earned The Certified Business Economist™ title (CBE) from the National Association of Business Economists (NABE). Ms. Mace is often cited in the Wall Street Journal, the New York Times, Seniors Housing Business, Seniors Housing News and McKnight’s Senior Living and has a bi-monthly column in the National Real Estate Investor.
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