Senior Spotlight: A Surge For Senior Housing Expected In 2025
The most industry growth since the pandemic could be here this year!
Happy, Happy New Year! 2025 is set to be a big year for senior housing growth and development. As one of the sectors hit hardest by the pandemic, shifting economic factors and heightened demand are now driving industry momentum into an upward cycle. We’ve summarized the 3 key areas in which to expect progression below.
DEMOGRAPHIC SHIFTS
- In the next decade, the US population aged 80+ is projected to increase 47%.
- Pew Research reported in 2023 that 62 million adults, nearly 20% of the US population, is aged 65 and older. By 2054, that number is likely to be 84 million individuals or nearly one-quarter of the population.
- The number of centenarians (those aged 100+) is expected to quadruple in the next 30 years.
- 42,000 new senior housing units A YEAR will need to be created to meet the associated demand of an aging population.
CONSTRUCTION CONSTRAINTS ENDING
- Senior housing supply has hit a 14-year low, creating occupancy gains in existing communities.
- Decline of interest rates and a more favorable lending landscape should help the financing of new builds become competitive again.
- Senior living operators are finally able to shift from reactivity-based pandemic mode to a strategic mindset driven by consumer desires.
THE EVOLUTION OF NEEDS & WANTS
- While assisted living is seen as a necessity and not a choice, the growing ‘active adult’ market is focused on seniors looking for a lifestyle alternative vs. daily care.
- For those who are entering assisted living, the emphasis on aging in place means that their needs are higher by the time they need to transition into care-based facilities. This has led to an increase in regulatory changes in senior health care in over 30% of states.
- Popular markets for new senior housing communities are coastal areas, followed by secondary cities (cities that are not capitals or major cities – but surrounding urban hubs that still play a vital role in a region’s development). Secondary cities offer a blend of proximity and affordability.
- Dementia care is surging in demand; 7 million Americans are living with Alzheimer’s today – a number projected to reach nearly 13 million by 2050. 44% of assisted living residents had a dementia-based diagnosis in 2022.
- Like all fields, technology and AI will shape senior housing; examples include predictive analysis to estimate fall rates, hospitalizations and other medical events. Other applications include care integration, program efficiency, increased social engagement and recruitment of both staff and prospective residents.
Wow! The bottom line is that change is on the horizon! Let’s hope that its efforts to promote living longer and living meet, or better yet exceed, our expectations. You can count on us posting progress and updates of senior housing development as 2025 marches on.
Cheers,
Bobbi
Resources Used:
The Road Ahead: Senior Housing Trends to Watch in 2025 ;
‘Change in air’ for senior living and care industry in 2025
Bobbi Decker
DRE#00607999
Broker Associate
650.346.5352 cell
650.577.3127 efax
www.bobbidecker.com
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Bobbi Decker & Associates fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. For more information, please visit: http://portal.hud.gov/
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