Senior living
Few new senior living buildings are going up, and a lender expects 2027 to stay tight
A Walker & Dunlop outlook describes a scarcity-driven market: occupancy above 90%, construction starts at about a third of normal, and rents rising more than 4% a year for over four years.
Key facts
- Senior living occupancy is above 90% and new construction is far below normal.
- Rents have risen more than 4% a year for 17 straight quarters.
What happened
Commercial real estate lender Walker & Dunlop released its 2026 senior housing outlook, which Senior Housing News reported on October 28. The firm says the industry has entered a "scarcity-driven cycle," with demand from an aging population growing while very few new buildings are being started.
The report cites data from NIC MAP showing occupancy at 90.4% in the third quarter of 2026. Over the past four quarters, construction started on about 5,100 senior housing units, compared with a long-term average of about 15,600. Rent growth was 4.7% in the second quarter, the 17th quarter in a row above 4%.
Investors are competing to buy existing buildings. Deals in the second quarter totaled $6.8 billion, up 44% from a year earlier, and sales over the past four quarters reached $32.2 billion, up 74%. Real estate investment trusts made up 36% of purchases, compared with 15% in 2023. Walker & Dunlop said it expects 2027 to look much like 2026, with demand continuing to outpace new supply.
What it means for families
When few buildings open and most units are full, families may find fewer openings and higher monthly rates, especially at popular communities. A change in ownership can also bring changes in rates or management, so it helps to ask.
For example: a family expecting to move a parent next spring may want to tour now, ask about wait lists and get rate increase history in writing.
Ask each community how much its rent rose in each of the last three years and what is included in the base rate.
What this means in New York: when comparing assisted living, ask whether the residence holds an Assisted Living Program (ALP) license, which can accept Medicaid, and how long its wait list is.
What to do this week
- Start touring before a move is urgent and ask about wait lists.
- Ask for the past three years of rent increases in writing.
- Compare what each community's base rate includes.
Sources
More from Assisted & senior living
- Senior living rents up about 30% in five years as new building slows
- Fire that killed two at Mississippi assisted living center was started by smoking materials, officials say
- New senior living buildings will stay scarce and pricey through 2030, forecast says