Analysts are trying to find out why the senior-housing occupancy rate is in decline. Many think work-at-home changes play a part – and perhaps fear of another pandemic.
NEW YORK – Real estate analysts are trying to figure out whether remote work is negatively impacting senior housing.
The occupancy rate for senior-housing facilities was 83.7% in the second quarter of 2023 – an increase from the pandemic’s low-point but still below the 87.1% rate in the first quarter of 2020.
Plus given the age of baby boomers, senior-housing demand should be growing rather than shrinking, according to the National Investment Center for Seniors Housing & Care, and it’s no longer difficult to visit family members after Covid protocols have eased.
Why the change? Analysts cite a lack of demand, and wonder if remote and hybrid work schedules keep many older Americans from moving into senior-living communities. For the increasing number of adults who worked remotely during the pandemic, it became easier to check in on aging parents during typical workdays. That greater flexibility in caring for aging parents may have caused a delay in transitioning older adults to expensive senior-housing accommodations, says John Pawlowski, an analyst at Green Street.
Other analysts think remote work could be having some impact, but point out that seniors have seen their home values decline from their pandemic peaks. That could make some reluctant to sell and move into senior-living communities.
The age when people enter senior housing is also increasing, another sign that people are choosing to delay the transition, says Vikram Malhotra, an equities analyst at Mizuho Securities.
For some caretaker adults, however, it could be the fear of separation based on memories of the pandemic, which highlighted media photos of older adults staring out windows, unable to see their families for extended periods of time.
Source: Wall Street Journal (07/11/23) Parker, Will
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