New Report Reveals The Forces Beyond Economics, Demographics Shaping Senior Living Penetration Rates

Senior living penetration rates are influenced by more than demographic and economic trends, according to a new study from the National Investment Center for Seniors Housing and Care (NIC).

Senior living penetration rates have hovered on average between 10% and 11% nationally for years, but NIC MAP data shows they can widely differ from one market to another. For example, Minneapolis, Minnesota, carried an average penetration rate of 10.1% as of the fourth quarter of 2025 while Las Vegas carried an average penetration rate of 1.9%.

NIC data shows that markets with higher income levels, greater homeownership and wealth among prospects along with deeper workforce capacity typically carry higher penetration rates. But these aren’t the only factors that play into penetration rates, the study’s authors found.

“For operators, this research serves as a strategic roadmap. It shows that penetration rate growth requires education, pricing transparency, workforce investment and policy engagement,” NIC Senior Principal Omar Zahraoui told Senior Housing News. “The biggest takeaway is that penetration is not determined by demographics or socioeconomics alone. Markets with strong wealth and income profiles among adults aged 75 and better do not automatically achieve higher penetration.”

Penetration rates reflect “a macro-level measure of how well the entire senior housing ecosystem enables adoption,” the NIC researchers wrote.

“Unlike occupancy for example, which reflects performance at the asset level, penetration captures the collective success of an industry in reaching, educating and serving older adults,” they wrote.

According to the researchers, one-third of the top 99 markets in the U.S. defy the long-held assumption that higher care needs lead to higher penetration rates, “showing that elements shaping individuals’ stability, upward mobility and peace of mind define a market’s potential, but other forces ultimately shape the penetration outcome.”

In fact, the NIC researchers found that markets where prospects had fewer care needs had higher penetration rates, “an unexpected result suggesting that assisted living can be often a proactive choice and not purely a reactive decision.”

Another potentially underlooked factor influencing penetration rates is culture, awareness and perception. According to the researchers, cultural norms around aging and senior living “remain powerful differentiators” in penetration rates. For example, Lancaster, Pennsylvania, a market with multiple non-profit senior living communities, has historically carried a higher penetration rate than other markets.

Affordability also plays into penetration rates, both actual senior living community rates and what residents expect to pay.

“The affordability challenge in assisted living is often less about absolute cost and more about perception, confidence in planning, delays in decision-making and alignment with available options, all of which can outweigh actual financial capacity in many markets,” the researchers wrote. “A number of markets have unoccupied units priced within reach of a large portion of older adults, based on median income and net worth metrics. This suggests that confidence in assisted living and disconnects between current lifestyles and future plans for aging can be more significant barriers than just cost.

Workforce is also a big factor in penetration rates. Markets with“stronger” nursing assistant (CNA) staffing pipelines “achieve higher penetration rates, those that cannot stabilize their workforce may limit their own penetration growth, regardless of demographic need or demand,” the researchers wrote.

State or policy decisions also can influence local penetration rates by setting rules and regulations related to Medicaid waivers, discharge rules, certificate of need processes and policies that increase access, supply and affordability of services.

Researchers wrote that in order to improve penetration rates, it is going to take coordination “across all stakeholders,” including operators, investors, policymakers, educators and advocates.

“The broader takeaway is simple: Penetration is a product of alignment. Market penetration grows when structure, culture, affordability, workforce and policy move in the same direction,” they wrote. “They stall when even one of these components falls out of sync.”

Operators can use the study as “a market diagnostic framework to assess whether their market structural fundamentals, workforce pipeline, consumer awareness, affordability positioning and policy environment are aligned, or working against each other,” Zahroui said.

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