Demand Still Pushing Senior Living Occupancy Higher As Community Openings Remain Low

Throughout this year, senior living demand has pushed average occupancy higher for operators as other challenges kept construction at or near record-low levels. In the third quarter of 2025, that trend didn’t change, according to new NIC MAP data.

Senior living occupancy in the top 31 primary markets in the U.S. reached 88.7%, indicating a 70 basis point increase from the previous quarter, when average occupancy registered at 88%, according to new data from the National Investment Center for Seniors Housing & Care (NIC) and NIC MAP. The gains mark the 17th consecutive quarter of occupancy growth for the industry.

Average occupancy in the third quarter of 2025 exceeded 85% in all 31 of the primary markets NIC tracks. At the top of the pack with regard to occupancy was Boston (92.6%), San Francisco (90.9%) and Baltimore (90.6%) while the markets with the lowest occupancy in the third quarter were Miami (85.3%), Atlanta (85.9%) and Las Vegas (85.9%).

The number of occupied senior housing units increased from roughly 623,500 in the second quarter of 2025 to nearly 630,000 in the third quarter of 2025 as the baby boomers moved into senior housing in “record numbers,” according to NIC.

Average independent living reached 90.2%, marking an increase of 50 basis points from the second quarter of 2025 and the first time the sector has exceeded 90% average occupancy since 2019. Average assisted living occupancy increased 90 basis points to 87.2% in the third quarter of 2025.

Average active adult occupancy dipped by 20 basis points to 92.1% in the third quarter of 2025, likely due to unit absorption from newly opened communities still in lease-up, according to Lisa McCracken, head of research and analytics at NIC.

“Overall, occupancy rates have ranged from 92% to 94% over the past five quarters since NIC MAP began tracking this data,” McCracken told Senior Housing News.

The senior living industry brought online fewer than 1,400 new units in the second quarter of 2025, and total senior living inventory grew just 70 basis points, in that period versus the same quarter in 2024. This follows the industry seeing record lows of new inventory in the previous quarter.

Development and construction costs are continuing to rise due to labor challenges, lengthening construction timelines and land acquisition costs. Another headwind is that the financial math needed to make senior living development work is not currently as compelling as the math driving acquisitions of newer, type A properties for prices lower than replacement costs. Capital providers are also limiting their equity and debt to “well-established, very strong developers and operators” as uncertainty about the future remains.

“For many, the terms for this construction capital still do not pencil out in terms of debt available and the equity commitment needed,” McCracken said.

Consumers continue to demand high-quality communities, making operations harder for competing functionally obsolete communities, McCracken said. That issue is only exacerbated by the slowdown in construction.

“It will take some time for that to show up in new units being delivered for the sector,” McCracken said. “For operators and owners, we fully expect continued growth in occupancies and future quarters of additional record-setting with total occupied senior housing units.”

The post Demand Still Pushing Senior Living Occupancy Higher as Community Openings Remain Low appeared first on Senior Housing News.