Summary: The senior housing industry needs more private pay properties that are within reach of the middle/low-middle income segment. I want to start a conversation on how to fill this need, and hope you will add your thoughts.
Current Situation: The senior housing industry does a good job providing care and housing for the wealthy in high-end, luxury communities of all types i.e., independent living and assisted living, and for the poor in Medicaid-oriented skilled nursing facilities. However, 33% of 75+ households land in the middle of the earned income spectrum, earning between $20,000 and $40,000 per year; this group has few attractive options. They can’t afford the high end and prefer not to live in public-pay homes.
Current development activity has focused on the high end, with costs per unit ranging from $200,000 to $350,000. The construction costs in upper-end assisted living properties mean that rents need to be $4,000 to $6,000 per month (including care charges) to be viable. Independent living rents for new construction range from $2,500 to $4,000 per month. These monthly rates squeeze the middle/lower-middle class.
Next Steps: The industry needs to generate a solution for what promises to be a large wave of seniors stuck in the middle. I want to be part of the solution. This blog will explore current thinking and highlight innovative approaches related to affordable private-pay senior housing. I will post additional content as I explore this topic and want to spark a conversation. Please use the comments section to point out resources, direct me to people doing innovative things, and share your ideas.
Related links:
United States Census Bureau www.census.gov
National Investment Center for the Seniors Housing and Care Industry www.nic.org
