If the motto of the last few years was “survive until 2025,” then perhaps our new motto should be “moving forward with cautious optimism.” Although it’s not as catchy, it is reflective of the results of the 2025 Senior Living Outlook Report, the latest installment of Lument and Senior Housing News’ annual collaboration. With 87% of respondents indicating they are either somewhat or very positive about the months ahead, clearly many of us are ready for brighter days and accelerated growth.
The theme of cautious optimism that permeates this year’s report is a familiar one, as favorable demographics, improving fundamentals, and a less volatile market should positively impact debt proceeds, cap rates, and valuations. Will that lead to an uptick in deal activity? Our results suggest so, as 50% of applicable respondents said their company plans to buy seniors housing assets in the next year.
Optimism extends to operations as well, as respondents are confident occupancy rates will increase across all acuity types in 2025, with memory care the most cited to see rent growth (83%), followed by assisted living (68%), and independent living (65%).
Regarding new development, 58% of respondents believe the industry will see an uptick in construction starts in the year ahead, a significant increase from 2024 when only 22% predicted an increase. Only 10% of 2025 respondents predict a decrease, compared to 39% in 2024.
In addition, approximately half of the survey respondents believe we will see sidelined projects restarting and more M&A opportunities in the coming months. Despite the cautions optimism, the sector still faces substantial challenges in the immediate future. Staffing woes continue to be the greatest challenge, as indicated by 55% of respondents—an increase of 9% from 2024. Occupancy ranked as the second greatest challenge for respondents at 20%.
To read the complete survey results, download the report at Senior Housing News.
