Seniors Housing Weekly Update - The Looming Seniors Housing Bubble
December 10, 2013
The Looming Seniors Housing Bubble
For subscribers to The SeniorCare Investor, my lead story this month concerns the possibility of a looming seniors housing bubble. It is a combination of high asset values in the acquisition market, where we are in the fourth year of the current bull market, but more importantly, the increasing amount of new development in assisted living and memory care. A year or two ago, it was the experienced operators who were kick-starting their development teams. Now, it seems that it is becoming the sector de jour for anyone in the real estate business. And that is when the real mistakes start to happen. The state of seniors housing is quite good right now, which is good and bad news. Bad news because that means that every Tom, Dick and Harry will want to get into it, and that creates the problem. Good news because it will be a growing industry for years to come. But will there be a mismatch between the demand and the supply as more developers enter the market? Time will tell. But I would like to hear from any and all of you as to whether you think we are approaching bubble time in seniors housing, why you think so, or not, and whether it can be avoided. Thanks.