Marcus & Millichap

Seniors Housing Report

National Report, Second Half 2019

Special Research Report

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Seniors Housing an Indispensable Investment Component; Powered by Massive Demographic Shift Over the Next Several Decades

Aging population paints a promising picture for seniors housing outlook. Demand-side pressures are building in the seniors housing market as the approximately 73 million baby boomers move further into retirement and their older years, when they might need assistance. The leading edge of this cohort is currently 73 years old and captures those as young as 55, pointing to a strong wave of demand in coming years as the typical seniors housing residents are in their early 80s. Over the next five years, the U.S. population of those 75 and older will grow by 5 million, a 22 percent increase, a much more rapid expansion than the 2.8 million people age 75 or older added over the previous five years. This massive demographic shift, coupled with the rise in medical services the aging population could require, ensures broad-based demand across all forms of seniors housing. The level of care needed in the older cohorts points to continued momentum for the seniors housing market as well, reflected by robust estimates for healthcare expenditures over the next decade. By 2027, healthcare spending will account for nearly 20 percent of the overall GDP, driven in large part by the boomer generation. High rates of Alzheimer’s and other dementia remain another factor fueling the need for more modern facilities with qualified staff, contributing to the bright outlook for the seniors housing sector.

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