National occupancy rates for senior housing, which change in response to different factors than those that affect the rest of the residential housing market, registered a small drop in the first quarter of 2010, according to the National Investment Center for the Seniors Housing and Care Industry (NIC).

This increased housing availability reflects a decline of approximately 0.3% in occupancy for both independent living and assisted living facilities nationwide. Rental prices continued to grow, but at a slower rate than before, undoubtedly influenced by the increased availability of space.

The NIC expects the decline in occupancy rates to reverse in the near future, as reduced construction puts a cap on the supply of senior housing. [For more information on current construction in California, see first tuesday’s Market Chart, CA Single- and Multi-Family Housing Starts.]

first tuesday take: The demand for senior housing is primarily determined by one single factor: the number of senior citizens. Unlike factors affecting demand for other forms of real estate, this factor is always both quantifiable and predictable.

As a result, the senior housing market is rarely subject to the violent rises and falls that beset the housing market at large. As this news item shows, however, even the senior housing market is influenced by the state of the economy. The drop in occupancy rates is a temporary setback for a constant market, but you can expect it to be quickly reversed by the unstoppable forces of demographics.

The boomers are on their way to these facilities, and their dis-savings to pay for assisted living with be felt more by a stock market decline than a real estate sales decline. Savvy agents will be on hand to get those listings from the boomers as they shed their current residences and move to be closer to their grandkids.  Anticipate that trend correctly, and you may get rich on broker fees.

Re: Seniors housing occupancy falls, rent growth continues,” from the National Investment Center for the Seniors Housing & Care Industry