We previously mentioned the “incoming Silver Tsunami” this summer when we discussed the housing market, in reference to how many seniors are downsizing or exiting the housing market altogether. Many of those baby boomers are choosing to move into senior housing facilities, which some investors have dubbed “recession-resilient investment opportunities.” So today, let’s talk about the senior housing market.
An aging population
According to the U.S. Census Bureau, the population age 65 and over has already grown “nearly five times faster than the total population” between 1920 and 2020 and is expected to rapidly rise in the next few years as the last of the baby boomers turn 65 in 2029. This leaves ample opportunities for businesses to invest in this consumer base, starting with where they choose to live.
The longevity economy
This rapidly growing population has resulted in a growing interest in what is referred to as the “longevity economy,” which simply refers to the economic contributions of Americans aged 50 and over. Investors, in particular, are looking toward the senior housing market as a safe bet that is likely to pay off big in the next few years. As CNBC put it, senior living communities, for both active adults and those who need assistance, are on the edge of a boom – a baby boom to be exact.
The CEO of one investment company told CNBC that they expected demand for senior living to grow 28% over the next five years and were investing heavily in the industry. The investment group has already acquired over 850 senior living communities and is seeing occupancy rates increase, in part due to a lack of new developments. This mirrors a national trend that has seen senior living occupancy rates return to pre-pandemic levels, as high construction costs and interest rates limit the construction of new facilities. The increase in demand and limited supply has resulted in a nearly 5% annual average rent increase across the sector, which has investors jumping in.
In the Phoenix area alone, “$535 million worth of senior housing facilities have traded hands thus far in 2025,” which is already more than double the value of properties sold in 2024. Other healthcare real estate investment trusts are racing to acquire as many properties as they can while the economic and demographic factors are in their favor. A Toledo-based company has already acquired $900 million in properties in the U.S. and another $3.3 billion in Canada this year.
Global impact
The United States isn’t the only country dealing with an aging population. Many other countries, such as Japan, Italy, and Greece, already have an even larger proportion of citizens aged 65 and over than the United States and are grappling with similar issues resulting from this demographic shift. Additionally, immigration from other countries can have an impact on the senior housing market in unexpected ways.
On January 21, 2025, the Department of Homeland Security rescinded a general policy of not conducting immigration enforcement activities in and around certain “protected” areas such as churches, schools, service centers, and healthcare facilities. And last month, a group of lawmakers sent a letter to the Health and Human Services, Labor, and Homeland Security departments, highlighting the impact the administration’s new immigration policies would have on healthcare workers, including those working in assisted living facilities. Many experts are concerned about the ripple effect this will have on the senior housing market.
For example, an assisted senior living facility in Virginia reported that 65 of its staff members are legally working under Temporary Protected Status and would likely lose their jobs with new policies terminating those statuses for some countries, leaving residents without the care they need.
