What is considered standard occupancy in senior housing communities
A question often asked is, “What is considered the standard occupancy level in senior housing projects?” Occupancy and vacancy factors are analyzed by the “stabilized rate” or the rate once the property has reached through the initial lease-up period. Among senior active adult projects with no or few services, a 5% vacancy rate is considered market equilibrium, allowing for consumer choice and normal turnover/search times for rental units in the marketplace.
However as seniors require more services, a 7% vacancy rate is considered standard as turnover times are longer. Here in the Twin Cities and across the country, vacancy rates have increased in independent senior housing projects as seniors opt to stay in their homes with plummeting housing values and the ensuing recession. However, since assisted living and memory care are need driven, vacancy rates have remained stable and there continues to be demand for these product types.
According to the National Investment Center (NIC), occupancy rates across the country (as of 3Q 2009) averaged the following:
• Independent Living: 86%
• Assisted Living: 87%
• Nursing Homes: 84%
• CCRC’s: 88%
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