Senior living market trends can have a huge impact on your organization, especially as you plan for development.
For our mid-year publication, Plante Moran Living Forward is providing construction and senior housing market data in four regional reports:
- East North Central Region (i.e., the Midwest), encompassing markets across Michigan, Illinois, Indiana, Wisconsin, and Ohio
- Mid-Atlantic Region, encompassing markets across Kentucky, Maryland, North Carolina, South Carolina, and Virginia, as well as Washington, D.C.
- Northeast Region, encompassing markets across Connecticut, Massachusetts, Maine, New Jersey, Pennsylvania, and Rhode Island
- West North Central Region, encompassing markets across Iowa, Missouri, Minnesota, Nebraska, and Kansas
Our reports focus on data from the regions’ primary markets benchmarked against comparable markets in the nation.
While these snapshots can help provide a pulse on the market, we encourage you to reach out to our team before you make any decisions about your plans for growth or repositioning. Your local market, the condition of your assets, your strategic plan, and your operational health should all be considered holistically.
Highlights from the year-end Market Snapshot reports
Construction trends
Construction costs remain elevated. The Construction Cost Index and Materials Cost Indices, which help us understand how the cost of building projects is changing over time, are up 1.58% and 1.15%, respectively, over last year. The Producer Price Index (PPI), which measures the change in costs for raw materials, shows an increase for concrete and lumber compared to this time last year. However, steel has seen a significant drop since its peak in December 2021 and is down significantly compared to last year.
Concerns about inflation and the impact of current and expected tariffs are causing many to brace for potential material price increases.
Senior housing trends
Demand for senior living remains strong across all four markets we assessed. Occupied units hit all-time highs this quarter in all four regions.
Across every region we assessed, independent living (IL) and assisted living (AL) occupancy rates continue to climb as absorption outpaces inventory growth. IL and AL occupancy rates in the West North Central Region currently sit below the national averages for their product type, while the Northeast Region’s IL and AL occupancy rates sit above. The Mid-Atlantic Region’s IL occupancy is above benchmarks, while its AL occupancy is below. The East North Central Region is just the opposite, with IL occupancy sitting below the national average and AL sitting just above.
The combination of strong occupancy, increasing number of occupied units, and strong absorption is a positive indicator of market vitality. Owners should be careful to evaluate their local markets, however, as senior living demand can vary by locality. In some markets, overbuilding could become a concern.
Read the full market report for more senior housing market trends
Download the year-end reports for insights into each region’s senior housing supply, demand, and construction trends.
