Number 3 in series of 10 from Market Watch,By: JIM RENDON.
“The housing crisis and the recession have had a significant impact on the assisted-living business. According to the National Investment Center for the Seniors Housing & Care Industry, occupancy rates are at 88.7 percent for 2012, down from their peak of 90.6 percent in 2006. Often, seniors move into assisted-living facilities after selling their homes, but with housing prices down — especially in retirement hot spots like Florida, California and Arizona — fewer seniors have the money to move. And in some of the softer markets, overbuilding too has taken a toll on the industry: The Chicago area’s vacancy rate is down to 83.7 percent, with 453 units under construction; St. Louis, with 84.7 percent vacancy, saw inventory grow by 8.2 percent last year, according to the National Investment Center.”
Everyone in the senior living world is seeing competition increase. More and more providers are entering the assisted living market all the time.
“Eager to lure potential residents, some places have begun enlisting marketing firms to help seniors sell their homes. Others have begun offering bridge financing to help people move into a facility while they wait for their house to sell, says Suzanne Modigliani, a Brookline, Mass., geriatric care manager. Furthermore, some communities are more competitive now than they were prior to the recession, and more are offering incentives such as discounts off the community fee or off the first few months’ rent. “Don’t assume that the listed rates are the rates they charge everyone,” says Nagaich. Depending on how many open spots a facility has, he says, potential residents may be able to negotiate the base rent down, or include a clause that bars raising prices for several years or even eliminates some of those pesky charges altogether.”
Even if you can’t negotiate a lower rate, you may be able to negotiate a “move-in special” such as free cable TV or phone service for a year. You may be able to negotiate the first month’s rent, or a moving van, etc. If the facility has vacant apartments, and other senior communities are offering specials and deals, you can always ask if the facility you choose will match the other facility’s offer. If the facility is full, you will not have much room to arrange for a lower rate or “deals”.