2025 Senior Housing Market Update

January 28, 2026

Check out our report on the latest market fundamentals, sourced from NIC MAP data.

The senior housing sector continues to demonstrate resilience and recovery, with occupancy improving for the 18th consecutive quarter, reaching 89.1 percent in the fourth quarter of 2025. Over the past two quarters alone, occupancy has risen by 120 basis points, underscoring sustained consumer demand. Compared to the same period the previous year, occupancy is up by 220 basis points—a clear indicator of the sector’s upward trajectory.

This quarter also marks the 18th consecutive period where absorption—the net change in occupied units—has outpaced inventory growth. While absorption dipped slightly from the previous quarter, a typical seasonal trend, six of the last seven quarters still saw over 4,800 units filled in primary markets. On average, nearly 5,800 units have been absorbed per quarter over the past fifteen quarters, with twelve of those quarters exceeding 4,000 units absorbed. These figures highlight the sector’s ability to meet and sustain demand.

Inventory growth remains historically low

New inventory growth has remained subdued, with fewer than 1,900 senior housing units added to primary markets in the last three months of last year. This marks the seventh time in the last nine quarters that inventory growth has stayed below 2,000 units—a stark contrast to the pre-pandemic average of nearly 5,000 units per quarter. Developers appear to be exercising caution, likely in response to market conditions and construction cost pressures.

The number of senior housing units under construction has also declined for sixteen consecutive quarters, with fourth-quarter activity down 20 percent compared to the same period last year. Currently, just over 16,000 units are under construction in primary markets—the lowest level since 2012. To put this in perspective, construction activity peaked in late 2019 with nearly 50,000 units underway. Today, construction represents just 2.3 percent of existing inventory, down from 2.8 percent a year ago.

Rent growth stabilizes after rapid acceleration

While occupancy rates are climbing, rent growth appears to have stabilized. The average asking rent for senior housing in the fourth quarter exceeded $5,700, reflecting a 4.4 percent year-over-year increase. This marks the fourth consecutive quarter of rate deceleration from its peak of 6.2 percent in the second quarter of 2023. Over the past seven quarters, annual rent changes have ranged from 4.0 percent to 4.5 percent, suggesting a return to more predictable growth patterns.

However, it’s worth noting that the current 4.4 percent annual increase remains above the pre-pandemic norm of 3 percent to 3.5 percent. Over the last 14 quarters, annual rent changes have fluctuated between 4.0 percent and 6.2 percent, with the most dramatic shifts occurring between the first quarter of 2021 (1.3 percent growth) and the second quarter of 2023 (6.2 percent growth). This period of rapid acceleration and subsequent normalization is unprecedented in the history of NIC MAP data collection.

Key takeaways for industry stakeholders

The senior housing sector is navigating a changing landscape of rising occupancy, stabilizing rents, and declining construction activity. While demand remains robust, the cautious pace of new inventory growth and construction suggests that developers are carefully balancing market opportunities with economic uncertainties.

As the sector continues this movement, stakeholders should focus on leveraging these trends to benchmark performance and identify opportunities for strategic adjustments. Whether it’s optimizing NOI through strategic pricing or aligning development pipelines with demand, the data equips stakeholders with the clarity needed for today’s market dynamics.

Commentary provided by Arick Morton, NIC MAP CEO

—Posted on Jan. 29, 2026

In the third quarter of 2025, the Seniors Housing sector occupancy improved to 88.7 percent, it’s seventeenth consecutive quarter of improvement. Seniors Housing occupancy has increased by a staggering 150 basis points in the last two quarters. Twelve of the last seventeen quarters have seen the highest volumes of absorption in the history of NIC MAP data collection, a strong indication of consumer demand for seniors housing. Seniors housing occupancy is up 70 basis points from the previous quarter and 230 basis points above the third quarter of last year.

The third quarter marks the seventeenth consecutive quarter in which absorption, the net change in occupied units, has exceeded inventory growth, the net change in operational units, which has led to continued occupancy growth across the sector. Absorption increased from the previous quarter with five of the last six quarters exceeding 5,700 units filled in Primary markets.

The pace of new inventory growth slightly increased after a historically low second quarter. However, inventory growth overall remains near all-time lows, as the third quarter saw fewer than 1,500 Seniors Housing units added to Primary Markets. This now marks six of the last eight quarters with inventory growth at less than 2,000 units per quarter. By comparison, the eight quarters prior to the pandemic averaged nearly 5,000 units added in Primary Markets per quarter. Moreover, the number of seniors housing units currently under construction has declined fifteen straight quarters as the third quarter is down 17 percent compared to the third quarter of last year.

Construction activity in the third quarter continues its slow downward trend, currently above 17,000 Seniors Housing units in Primary markets. This is the lowest number of Seniors Housing units under construction since the fourth quarter of 2012. This downward trend started in late 2019 prior to the COVID-19 pandemic when there were just under 50,000 Seniors Housing units under construction. Construction represented 2.4 percent of existing inventory in the third quarter, down from 2.9 percent a year prior.

While Seniors Housing occupancy is increasing, the reported annual rent change, measured against the previous year, appears to have fully stabilized. The average asking rent for Seniors Housing in the third quarter exceeded $5,650. This is a 4.3 percent increase compared to the previous year. After four consecutive quarters of rate deceleration from its peak of 6.2 percent in the second quarter of 2023, annual rent change has normalized and ranged from 4.0 percent to 4.5 percent year-on-year increase over the last six quarters.

Senior housing is poised to be one of the most profitable real estate asset classes, according to NIC MAP data in its Senior Housing Market Outlook.

—Posted on October 30, 2025

Senior housing sector occupancy improved for the 16th consecutive quarter to 88.1 percent in the second quarter. The 80-basis points occupancy improvement over the previous quarter was the highest in the last six quarters. Eleven of the last 16 quarters have seen the highest volumes of absorption in the history of NIC MAP data collection, a strong indication of consumer demand for senior housing.

The second quarter marks the 16th consecutive quarter in which absorption, the net change in occupied units, has exceeded inventory growth, the net change in operational units, which has led to continued occupancy growth across the sector. Absorption increased from the previous quarter with three of the last four quarters exceeding 6,000 units filled in primary markets. Furthermore, 10 of the last 13 quarters have resulted in at least 4,000 units being absorbed per quarter for an average of over 6,000 units being absorbed per quarter.

The pace of new inventory growth has decreased for two consecutive quarters, as inventory growth declined 68 percent compared to the second quarter of last year. An inventory growth of less than 1,000 senior housing units across primary markets had previously never happened in the history of NIC data collection.

Inventory growth in the second quarter was just over 800 units added. By comparison, the eight quarters prior to the pandemic averaged nearly 5,000 units added in primary Markets per quarter. Moreover, the number of senior housing units currently under construction has declined fourteen straight quarters as the second quarter is down 23 percent compared to the second quarter of last year.

Senior housing construction low

Construction activity in the second quarter continues its slow downward trend, currently below 18,000 senior housing units in primary markets. This is the lowest number of senior housing units under construction since the first quarter of 2013. This downward trend started in late 2019 prior to the pandemic when there were just under 50,000 senior housing units under construction.

Construction represented 2.4 percent of existing inventory in the second quarter, down from 3.2 percent a year prior. Of the NIC primary 31 markets, there are three markets without a single property under construction and another five markets with only a single property under construction. Only eight of the thirty-one primary markets have at least five active development projects.

Occupancy and rent change

While senior housing occupancy is increasing, the reported annual rent change, measured against the previous year, appears to have fully stabilized. The average asking rent for senior housing in the second quarter exceeded $5,600, the highest average rent in history. This is a 4.1 percent increase compared to the previous year.

After four consecutive quarters of rate deceleration from its peak of 6.2 percent in the second quarter of 2023, annual rent change has normalized and ranged from 4 percent to 4.2 percent year-on-year increase over the last four quarters.

Senior housing is poised to be one of the most profitable real estate asset classes, according to NIC MAP data in its Senior Housing Market Outlook.

—Posted on July 24, 2025

Senior housing occupancy improved for the 15th consecutive quarter to 87.4 percent in the first quarter of 2025. More importantly, first-quarter absorption increased for three consecutive years, up from 6 percent last year. In fact, this is the highest number of senior housing units absorbed in the first quarter in nearly a decade. This means more seniors than ever are moving into senior housing.

The first quarter marks the 15th consecutive quarter that absorption has exceeded inventory growth which has led to continued occupancy growth across the sector. Absorption increased by 6 percent, compared to the first quarter of last year and is expected to remain strong, as demand from the 80+ population is expected to expand over the next two decades. In the near term, occupancy will continue to increase as demand is expected to continue to outpace new supply.

The pace of new inventory growth decreased in the first quarter to less than 1,900 units, a decline of 32 percent compared to the previous quarter and slightly, 1 percent, compared to the first quarter of last year. Moreover, the number of seniors housing units currently under construction has declined thirteen straight quarters as the first quarter is down 8 percent compared to the previous quarter and down 24 percent compared to last year.

Construction activity in the fourth quarter continues its slow downward trend, currently below 20,000 seniors housing units in primary markets. This is the lowest number of senior housing units under construction since the second quarter of 2013. Historic inventory growth, both short and long term, is required to keep pace with current and anticipated demand.

Rents reach record highs

While seniors housing occupancy is increasing, the reported annual rent change, measured against the previous year, has continued to decelerate over the last seven quarters from its all-time peak high in the second quarter of 2023. The average asking rent for seniors housing in the first quarter exceeded $5,500, the highest average rent in history. This is a 4.0 percent increase compared to the previous year. After nine straight quarters of rate acceleration, we have now seen seven consecutive quarters of deceleration from a 6.1 percent peak in the second quarter of 2023, to 3.9 percent this quarter. While year-over-year rent growth has slowed, it still represents a pace well-above historic norms.

The collective impact of these trends points towards a continued expansion of senior housing market fundamentals. The combination of historic high demand growth, historically low supply growth, and rent growth slightly outpacing inflation positions senior housing to be one of the most profitable real estate asset classes in the future, according to NIC MAP data in its senior housing market outlook.

Commentary provided by Arick Morton, NIC MAP CEO

—Posted on April 29, 2025

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