Increased demand has propelled senior housing occupancy higher for four consecutive quarters. That’s among the findings resulting from data discovery and analysis undertaken by The National Investment Center for Seniors Housing & Care (NIC).
According to NIC MAP Vision, occupancy in senior housing grew 0.9 percentage points from 80.5 percent in Q1 to 81.4 percent in Q2, marking the fourth straight quarter of occupancy growth. Occupancy has risen 3.4 percentage points this quarter vis-a-vis the pandemic trough of 78.0 percent in the second quarter of last year.
Of senior housing units vacated during the pandemic, approximately 78 percent have been reoccupied within NIC MAP’s Primary Markets. These are represented by the 31 U.S. metropolitan markets for which NIC MAP Vision has collected data since 2005.
Demand is outstripping supply on a continuing basis, which has driven occupancy higher. In Q2 2022, the number of units under construction reached its lowest level since 2015, a fact attributable to 2020’s pandemic-driven slowdown in construction starts. Meantime, quarterly demand in Q2 reached its highest level since NIC MAP Vision started reporting the data in 2005. In a prepared statement, an NIC official attributed delays in new construction to high inflation, increasing prices for materials, shortages of construction industry labor and the Federal Reserve’s policy change toward higher interest rates, contributing to low inventories and boosted occupancy.
Within NIC MAP’s Primary Markets in the second quarter, those with the highest senior housing occupancy rates were Boston (86.3 percent), Minneapolis (85.1 percent) and Portland (85.0 percent). Houston (76.1 percent), Atlanta (77.8 percent) and Cleveland (78.2 percent) brought up the rear as metros with the lowest occupancies. Several months ago, a report on senior housing predicted robust demand recovery in 2022.