According to the Bureau of Labor Statistics, people 55 or older will spend more on housing than any other type of expenditure. After analyzing data from people who moved into senior living between 2017 and 2018, A Place for Mom (APFM) found cost growth changed as follows:
Independent living rates for seniors grew by 2.6 percent from 2017 to 2018, bringing median monthly costs to $2,552 in 2018. Assisted living costs for seniors grew slightly by 2.4 percent from 2017 to 2018, bringing median costs to $3,942 in 2018, and memory care costs grew 3.2 percent from 2017 to 2018, bringing median costs to $5,003 in 2018.
“These findings are significant, especially when viewed in comparison to increases in healthcare costs, which were up approximately 5.3 percent from 2017 to 2018 according to Centers for Medicare & Medicaid Services National Health Expenditures fact sheet,” said Charlie Severn, vice president of brand marketing with APFM. “The cost of senior housing is growing at a much slower rate than healthcare overall. To make it easy for families to find the cost of senior living in their city or town, we have created a robust interactive map on our website.”
The Index – the only free data source of its kind – draws on APFM’s large database of families that have moved into senior living and assisted living homes between 2012 and 2018. In addition to the growth trends and median costs noted above, the Index has detailed information on growth by region, as well as expenditure growth and median rates in top Metropolitan Statistical Areas (MSAs).
For instance, APFM found that the Western part of the U.S. had the highest increase: 4.3 percent from 2017 to 2018. While the Northeast saw a 3.1 percent increase, the Midwest came in at 2.6 percent, and the Southern region actually dropped 1.5 percent.
APFM also examined median monthly costs in the top 15 metro areas for population age 55 and older. In 2018, Boston overtook New York City for the highest monthly senior living rates for independent living, assisted living and memory care, while Tampa, Fla., continues to offer the lowest rate on senior living for the same categories.
The fastest growing metro markets for independent living included: Portland, Ore., 11.2 percent cost growth; Los Angeles, 5.6 percent; and Chicago, 5.3 percent.
In the assisted living category, the top five fastest growing markets were: Portland, Ore., 13.9 percent cost growth; Charlotte, N.C., 10.1 percent; Seattle 10 percent; Minneapolis, 9.6 percent; and Sacramento, 8.7 percent.
Memory care costs grew fastest in Los Angeles, 11.6 percent; Phoenix, 6.3 percent; New York, 4.7 percent; Minneapolis, 4.6 percent; and Riverside, Calif., 4.1 percent.
Finally, APFM’s Index spotlights that many consumers are finding greater value today over two years ago at every level of the market.
“The growth of senior housing construction over the past few years has led to price stability for families seeking long-term care even in a competitive real estate market. This increased capacity has led to significant competition for residents, providing improved options for consumers, whether they’re at the low, middle or high-end of the market,” explains Sue Johansen, vice president of partner services with A Place for Mom. “Communities of all types and sizes are offering amenities or unique programs to provide even greater value to seniors.”
For instance, American House Senior Living Communities has been increasing its technology platform to not only provide its residents real-time updates on community events, but to also assist with keeping residents and their families connected. Vi offers residents an impressive array of amenities from golf courses to fully equipped fitness centers and engaging social programs such as continuing education classes, tai chi lessons and writing workshops designed to help residents lead a healthy and enriching lifestyle.
Other communities provide a commitment to offering unparalleled service and hospitality to families through high-quality dining, and award-winning programs. Enlivant is preparing for next-generation residents who desire high-quality food, smaller portions and exemplary dining room service. Finally, there are luxury communities like those offered by Atria, one of which has a 15,000-square-foot rooftop retreat with stunning views of the Laguna Niguel hilltops in Orange County.
The Senior Living Cost Index is based on actual rent and care charges collected from referred family move-ins to A Place for Mom community partners. National and regional median costs and growth estimates are based on communities with at least one move-in for a given care type, two years in a row. The Index reports the median cost and annual changes across communities based on their annual median move-in charges for each care type. Cost and cost growth estimates are available at various geographic levels on more than 3,500 cities, as well as data at the ZIP code, county, metro, state, regional and national level.
ZIP code, city, county, metro, and state estimates are based on a proprietary machine learning algorithm that models inflation-adjusted move-in charges (in 2017 dollars) during 2017 and 2018. ZIP codes with a small number of move-ins borrow information about costs from other ZIP codes with similar median household income, similar proportion of adults 55 or older and geographic proximity. Cost estimates in each location are a weighted average of ZIP code-level estimates. ZIP code weights are based on 2017 American Community Survey population counts of persons over age 55.
Median household income and older population counts are based on the 2017 five-year estimates from the American Community Survey.
Housing rent growth is based on the annual average Zillow Rent Index. Inflation estimates are based on the monthly Consumer Price Index for All Urban Consumers – all items, available from FRED, with inflation adjustment factors calculated relative to the average index value for 2016.
Texas and Oklahoma estimates are unavailable, as APFM does not collect monthly care and rent charges due to state regulations.
Cost estimates are available at the ZIP code and county level for interested parties, although ZIP code estimates may not be as accurate. Estimates are also available by request for smaller senior living communities most often located in private homes in residential neighborhoods and known variously as Residential Care Homes for the Elderly (in California), Adult Family Homes (in Washington State), Assisted Living Homes or Assisted Living Centers (in Arizona), Residential Care Facilities (in Oregon), and as Residential Care Homes or Group Homes in other areas.
A Place for Mom
A Place for Mom, Inc. is North America's largest senior living referral service with more than 400 senior living advisors providing resources and personalized assistance in finding senior living services. Using its nationwide network of over 18,000 provider communities, APFM helps families find options based on a loved one's stated needs, preferences and budget. This includes independent senior housing, home care, residential care homes, assisted living communities and specialized Alzheimer's memory care. The service is offered at no charge to families as providers pay a fee to APFM. For more information, visit www.aplaceformom.com, call 1-877-311-6099 or visit one of APFM's social networks on Twitter, Facebook, APFM’s Senior Living Blog or Pinterest.