Senior Housing Crisis: Is Now the Time to Invest?

  • 👴 By 2030, over 73 million Americans will be 65+. This will greatly increase the need for retirement housing.
  • 🏘️ Builders are still making 60% fewer senior housing units than before the pandemic. This makes the supply shortage worse.
  • 📉 Assisted living did better than other asset types during past economic slowdowns. It shows strength.
  • 🌞 Clark County, NV expects over 20% growth in seniors by 2030. But there are still not enough places built there.
  • 💼 Big investors like Blackstone and Ventas have bought more assisted living properties.

More older Americans need housing. But there isn't enough of it. This problem is a big public health issue. It also gives smart real estate investors a chance to make money. In places like Las Vegas and other Sunbelt markets, investing in assisted living communities can be both good for money and good for people. We will look at the retirement housing crisis more closely. We will also see why more people are investing in senior housing. Then, we will talk about how investors can act now, before it's too late.

elderly couple walking in suburban neighborhood

1. The Boomer Bomb Is Here

The term “boomer bomb” talks about a huge change in how many older people there are. The U.S. Census Bureau says that about 10,000 Americans turn 65 each day. By 2030, this will make the senior population over 73 million people. That is more than 20% of all people in the U.S. This big change means one clear thing: there will be a lot of demand for senior housing.

Most of these people will get to a point where living on their own is too hard. They will need different levels of care. This ranges from places where they get some help to memory care communities for people with dementia and Alzheimer’s. This big group of older people means one clear economic fact: the need for senior housing is growing fast. It will stay steady and grow for decades.

empty construction site with cranes and dirt

2. The Retirement Housing Crisis: A Supply Shortfall in Motion

More people are getting older. But there are not enough new senior housing places. Builders are still making about 60% fewer senior housing units than before the pandemic (NIC MAP Vision, 2023). Developers stopped projects during the COVID-19 pandemic because things were unclear and materials cost more. They have been slow to start them again.

Also, many senior housing places are too old to work well anymore. They were built decades ago. They do not have the modern designs seniors want today. For example, they need easy-to-use common areas, private bathrooms, in-room emergency calls, and digital ways to stay in touch. This difference is getting bigger. There is a lot more demand, but old or not enough supply. This is making the retirement housing crisis worse.

Investors looking at big, long-term trends will not find a clearer problem. Building new senior housing or changing old buildings into senior housing does more than meet demand. It helps fill a very important national need.

modern assisted living facility exterior

3. Why Assisted Living Is Becoming a Financially Attractive Asset Class

Investing in assisted living is seen as a real estate choice that does well even when the economy slows down. Here are a few main reasons:

  • Demand based on need: Unlike luxury apartments or offices, seniors move into assisted living because they need to, not because they choose to.
  • Clear lease agreements: People often sign contracts for many years. Or they pay set monthly fees for their room, meals, and care.
  • Many ways to make money: Places can add to rent money with services. These include managing medicine, physical therapy, meal plans, and rides.

Multifamily and commercial real estate can change a lot when the economy slows. But assisted living keeps a steadier number of residents and net operating income (NOI). After problems from the pandemic, senior living got back to an 84.4% occupancy rate by mid-2023 (NIC, 2023). This shows a strong comeback.

What is more, long-term care insurance, veterans’ benefits, and Medicaid waiver programs help people pay. This makes assisted living even better for investors who want safety and to grow big.

aerial view of las vegas suburban homes

4. Las Vegas: A Sunbelt Magnet for Retirees

The Sunbelt has always brought in retirees. It has warm weather, tax benefits, and a lower cost of living. But Las Vegas offers special benefits:

  • No state income tax
  • Dry, arthritis-friendly weather
  • Lower costs for housing and healthcare than California or the East Coast
  • Close to good hospitals and medical centers

You can see these benefits in the numbers of people. Clark County, where Las Vegas is, will likely see over 20% more residents aged 65 and older by 2030 (Regional Transportation Commission of Southern Nevada, 2022). But still, there are few senior housing communities. This is especially true for assisted living.

Places like Summerlin and Henderson are already bringing in older residents. And more affordable neighborhoods like North Las Vegas give seniors who watch their money good choices. A senior housing investment put in the right place here is not just smart. It might become vital.

abandoned motel with vacancy sign

5. The Latent Equity in Converting Underutilized Properties

A growing trend in senior housing investment is changing old, unused properties into new ones. Instead of buying expensive land and building new, developers and investors are buying:

  • Empty motels
  • Closed office buildings (especially after the pandemic)
  • Low-rent, Class C apartment buildings
  • Empty retail strip centers

These properties have good basic structures. They also have existing systems like water, sewage, and zoning. This lowers both costs and how long things take. Las Vegas is known for its real estate markets that go up and down. It has many of these kinds of properties.

For example, older hotels near the Las Vegas Strip might not work for tourism. But they are perfect for assisted living. They have central halls, rooms with bathrooms, common areas, and kitchens that can be updated. Local experts like Steve Hawks can help investors find these good properties for changing. This is before others know about them.

elderly woman getting care in sunny room

6. Recession-Resilience: Lessons from Past Downturns

Some real estate sectors, like hotels, offices, and even apartments, have all been weak during recessions. But senior housing, especially assisted living, has shown to be strong in the past.

During the 2008 financial crisis, senior housing properties kept much more of their value and operating income. This was compared to other real estate, says the National Council of Real Estate Investment Fiduciaries (2010). The reason is simple: seniors still need a safe place with care. This is true no matter how the economy is doing.

COVID-19 was a clear challenge. But the pandemic also brought many good changes:

  • Controlling infection became the main goal.
  • Communication got better with video call technology.
  • Managing visitors, staff rules, and health care at the site got more modern.

These long-term changes not only make things work better. They also make people trust the sector more. This makes it a better place to invest than ever.

city skyline with construction cranes

7. Investor Demand Is Heating Up—But Supply Remains Tight

Big, experienced companies are showing they think the market will go up. In recent years, REITs like Ventas and Welltower, and big private equity firms like Blackstone, have put billions into senior housing (Bloomberg, 2022).

They often buy existing groups of properties or build new communities using development plans. They want to get a place in the market before cap rates get even smaller.

But even with more demand, there are few new building permits and construction starts. Not enough workers and materials, rising prices, and cities not wanting to approve high-density building are all slowing down new projects. This mix of strong demand and little supply means higher rent, fewer empty places, and higher property values. This is especially true in places like Las Vegas where there isn't enough supply.

financial charts on modern tablet screen

8. Financial Returns to Expect: NOI, Cap Rate, & Long-Term Stability

What can investors truly expect from assisted living investments?

  • Cap rates typically range between 5.5% and 7%.
  • Higher returns are often possible in smaller cities like Las Vegas.
  • Net operating income (NOI) gets better with money from services: health care, food, and wellness programs.

In projects where they add value, by building new or changing old places, investors might aim for Internal Rates of Return (IRRs) between 12% and 18%. This depends on how well they run things and who lives there. Not many types of assets offer this mix of steady cash flow, long-term population trends, and safe returns.

Even with interest rates changing, long-term demand will likely keep rents going up. It will also keep people from moving out too often. This protects investor returns through good and bad times in the market.

group of seniors sitting in park

9. Demographic Certainty = Investment Predictability

Many real estate areas follow cycles. Offices and stores do well when the economy does well. Apartments do well when there are jobs and good pay. But senior housing makes money from one sure thing: people get older.

The population of people 65 and older will surely grow for at least the next twenty years (Pew Research Center, 2020). At the same time, families are smaller. And there are fewer people to care for each older adult. This makes it sure that paid help, like assisted living, is not just a choice. It is a must.

Also, federal programs cover some long-term care costs. This is true for veterans or those who can get Medicaid. So, more people can afford these services. This means more people can qualify. And more properties can stay in business.

las vegas residential neighborhood aerial view

10. Local Insights: Where to Invest in Senior Housing in Las Vegas

Not all areas of Greater Las Vegas have the same demand for senior housing. Smart investors look at:

  • Summerlin: Has seniors with high incomes, good medical centers, and existing buildings and services.
  • Henderson: A fast-growing suburb with many communities just for older people.
  • North Las Vegas: Properties that cost less to get into. And zoning that helps new building projects.

Watching eviction rates, school closures, and how businesses change can show properties ready to be made into assisted living. Talking with service providers and operators can also help understand local demand for certain services. These include memory care or hospice support.

Steve Hawks and other local experts offer much market knowledge. They also have very detailed maps of city zoning laws. And they know about properties in trouble before they are listed.

caring nurse with elderly woman

11. The Moral and Economic Case for Investing in Senior Housing

Senior housing investment offers more than property value growth and steady money. It brings together making money and doing good. Today, environmental, social, and governance (ESG) ideas guide what investors choose. Making safe, good places for older people is both the right thing to do and needed.

More seniors live alone or apart from their families. So, the safety net for society is getting thinner. Investing in assisted living is not just a way to make money. It helps the long-term care system that is changing.

business team reviewing construction plans

12. Getting Started: What Investors Should Know

Investing in senior housing takes more work to run than apartments or storage places. Investors should do this with a team or partners. This team should have:

  • Licensed people who run things and have health care experience.
  • Developers who know ADA rules and building codes.
  • Lawyers who are good with elder care legal issues and contracts.
  • Property managers who know how to run regulated care places.

If you want to invest in assisted living in Las Vegas, talking to experienced local experts like Steve Hawks is more than just helpful. It makes things go faster, lowers risks, and brings in more deals.

13. Seize the Opportunity—Before the Wave Crashes

America’s retirement housing crisis is happening now. Not in five years. Demand is growing. Supply is not enough. Money is going to assets that do well in a slow economy. Senior housing, especially assisted living, gives a once-in-a-lifetime chance to make money. It also helps solve one of society’s most pressing housing problems.

Las Vegas is at an important point. Here, population numbers, how cheap things are, and unused properties make a special market for investors. If you see this chance, and the duty that comes with it, now is the time to act.

Ready to look at senior housing chances in Las Vegas? Talk to Steve Hawks. Get information on off-market deals, local knowledge, and partners ready to help you make money. And help meet an urgent need across the country.

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