Why Seniors Housing?
Seniors housing demand is driven by the population of seniors over the age of 75. Exceptional growth in this segment is expected to drive strong demand for seniors housing and specialized care programs in North America for years to come, especially as the Baby Boomer generation enters the market in 2021.
In Canada, the population of seniors over 75 years of age is expected to increase by 100.9% between 2011 and 2036, while the total population is expected to increase by only 21.9% over the same period. (Statistics Canada)
Other factors driving strong demand for seniors housing include:
- Undersupply of Long-Term Care Facilities: Pressures on the public healthcare system have resulted in an undersupply of Long-Term Care facilities. From 2005 to 2007, the waiting list in Ontario increased by 75%, while supply only increased by 3%.
- Increased Willingness to Pay: As compared to their parents, the Baby Boomers have a far greater willingness to pay for additional services and amenities. The Baby Boomers are also familiar with the cost of seniors housing as they have been through the residence and care selection process for their parents.
- Increased Life Expectancy: As the diagram on the left illustrates, life expectancy is increasing. This is expected to extend the average length of stay of residents in seniors housing properties, and therefore increase overall demand.
CBRE, the world’s premier full-service real estate company, estimates that the Canadian seniors housing market needs:
- 50,000 new suites (425 new residences) over the next 10 years.
- 325,000 new suites (2,700 new residences) over the next 50 years.