Over the last few weeks we have talked about the current state of the senior housing industry, namely the fact that it is truly thriving. Along these same lines, a report was just published by the market intelligence firm Reis on independent living communities rent prices. According to the report, rents are steadily rising amongst senior living communities in the many U.S. cities. Reis studied 112 metro areas throughout the U.S. and found that many are experiencing relatively high increases in rent. Columbia, South Carolina topped the list as the city with the highest increase in rent from 2015 to 2017, with a 10% gain. Fort Myers, Florida came in second with a senior housing rent growth of a little under 10%.
Other cities of note include Charleston, South Carolina; Portland, Oregon; Fresno, California; and San Jose, California. It is important to point out that not all cities experienced a substantial rise in rent. In fact, Jackson, Mississippi; Daytona Beach, Florida; and Buffalo, New York all saw independent living rent growth rates at around 2%, which is far below the 10% mentioned above. Albuquerque, New Mexico reported a shocking 1.2% rent growth, and some cities even saw independent living rents fall between 2015 and 2017.
Given the broad range of rent growths in senior living throughout the United States, it leaves us wondering what some of the main factors are in rent growth. There are numerous factors driving demand in senior living markets across the nation, including demographics. However, demographics aren’t the only driving force. In fact, many cities that house aging populations do not reflect this in their rent growth rate. On the other hand, metro areas that do not have as strong an aging population within the senior community posted average or above average rent growth rates. This makes it difficult to predict what exactly is happening within the independent living market and what the future holds. For more insight on this, please do not hesitate to contact Shep Roylance of The JCH Group.