Senior living operators slowed down rate increases in the first quarter of 2024 compared with in the past, and discounts are highest right now in independent living.
That’s the latest snapshot from NIC MAP Vision, released on June 6.
According to the NIC data, independent living operators had grown resident rates 4.2% on average by March of this year compared with the previous year. That represents a decrease compared to March 2023, when those operators grew rates by 8.1% versus the prior year.
Assisted living operators increased resident rates by 4.4% in March, a decrease compared with 8.8% resident rate growth seen in the same month in 2023. Memory care operators grew resident rates by 4.7% in March, which was lower than the 7.7% increases those operators passed through in March, 2023.
“The pace of growth in initial rates for all care segments decelerated in the first quarter of 2024,” wrote Omar Zahraoui, principal at NIC.
Lisa McCracken, NIC head of research and analytics, told Senior Housing News year-over-year price escalation has come down compared to 2022 and 2023.
“While expenses related to wages, product costs and utilities remain high, those increases are at reduced levels against the past few years,” McCracken said. “Operators also need to remain price competitive and be in-line with how much the market and prospective customer is willing to pay. We need to consistently look for additional revenue streams and ways to be more operationally efficient.”
Senior living operators are still enacting discounts to attract new move-ins in the first quarter of 2024,with the greatest average of discounts seen in independent living at 12.7%. In March, the average independent living discount was $507. Operators haven’t enacted discounts below $400 on average since June of last year, according to NIC.
The average discount in assisted living and memory care in the first quarter of the year was 8.8% and 8.9%, with average amounts of $506 and $778, respectively.
Operators in all three care segments are seeing a “strong” pace of move-ins, according to Zahraoui. Memory care operators averaged move-ins totaling 3.7% of inventory in the first quarter of 2024, compared to 3.4% in the fourth quarter of 2023. Assisted living operators averaged move-ins totaling 3.2% of inventory in the first quarter 2024, compared to 3.0% in the fourth quarter of 2023.
Independent living operators in the first quarter of 2024 averaged move-ins totaling around 2.2% of inventory, compared to an average of 2.1% in the fourth quarter 2023. Those operators also saw move-outs averaging at about 2.1% in the first quarter of the year.
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