High Demand, Low Number Of Community Openings Push Senior Living Occupancy Past 89%

Rising demand and low rates of new construction are pushing average senior living occupancy up as the industry creeps ever-closer to a supply crisis down the road.

Occupancy across the 31 primary markets the National Investment Center for Seniors Housing and Care (NIC) tracks grew to 89.1% in the fourth quarter of 2025, representing a 0.4 percentage point increase compared to the third quarter of the year.

Average independent living average occupancy exceeded 90% and assisted living reached 87.7% in the fourth quarter of 2025. Active adult reached an average occupancy rate of about 92% in the fourth quarter.

The total number of occupied units increased from an estimated 630,000 in the third quarter of 2025 to nearly 635,000 in the fourth quarter, according to the report, representing a nearly 20,000-unit, or 3%, increase compared to 2024.

Across the 31 markets NIC tracks, seven exceeded 90% occupancy rates in the fourth quarter, up from five in the third quarter of 2025. The highest performing markets were Boston (93.1%), San Francisco (91.9%) and Baltimore (91.9%). Additionally, San Francisco, Los Angeles, Dallas and Chicago are approaching their highest occupancy levels since NIC MAP began tracking the data in 2005.

Only five markets had occupancy below 87%, with the bottom three being Miami (85.4%), Atlanta (85.5%) and San Jose (86.1%).

Occupancy is trending high enough that residents may start having trouble finding a unit of their choice in the months and years ahead, , according to Lisa McCracken, NIC’s head of research and analytics. Without more options available, other companies outside the industry may try to serve older adults in similar ways.

“We anticipate that the occupancy gains will continue. The fourth quarter occupancy growth was a little smaller than anticipated, but the absorption levels remained high and we feel that the demand will be with us for the foreseeable future,” McCracken said. “This will be interesting to monitor in subsequent quarters.”

New inventory growth remained below 1% of total inventory for the third consecutive quarter and only 1,900 new units opened in the fourth quarter, according to the report.

The report also notes middle-income older adults are the most impacted by current supply-demand dynamics, as newly developed communities lean toward higher-income residents due to increased construction and development costs.

“A 200 basis point gain in one calendar year is a solid rate of growth that shows no signs of slowing,” Arick Morton, CEO of NIC MAP, said in the release. “Absent new supply entering the market, it’s likely that many markets will begin to register all-time highs in the near- and medium-term.”

The post High Demand, Low Number of Community Openings Push Senior Living Occupancy Past 89% appeared first on Senior Housing News.