As home resale values continue to be strong and the time period to sell a home remains short, now is a good time for prospective senior living residents to consider selling their homes, according to a new report.
Sales and marketing consulting firm Love & Co. released a report taking a look at the first four months of 2024 in the real estate market. Not much has changed from trends that began in 2023, according to the findings, but the coming months could bring an increased supply of homes for sale, making the market more competitive from a pricing perspective and limiting the potential growth in home resale prices.
That means that now is the ideal time to sell prospective residents on the value proposition of senior living, including its cost effectiveness, quality of life, improved health outcomes and high resident satisfaction, according to the firm. That value was outlined in a 2023 white paper from Argentum, updated earlier this year to include information from a NORC at the University of Chicago report showing increased longevity for senior living residents compared with older adults living in the greater community. J.D. Power’s 2023 US Senior Living Satisfaction Study also showed high senior living satisfaction scores.
Potential senior living residents looking to downsize from a home in the greater community to a unit in a senior living community are entering a market where the median home resale values to be the highest ever, according to the Love & Co. report. But the supply of homes for sale continues to increase, and in April, the time it took to sell a home grew by just under 15 days compared with the beginning of the year.
But even the increased supply of homes on the market for resale has not dampened the annual rate of sales from 2023, according to the report. Month-by-month home sales in 2024 so far closely mirror that of 2023.
Although there was optimism earlier this year that federal interest rates would decrease, inflation continued to trend “hotter,” leading to uncertainty about decreases in the remainder of the year, the report states. And mortgage rates, instead of decreasing as expected earlier this year, have continued to increase. The average 20-year fixed mortgage rate was 6.62% in January. Although that rate is down more than 1% from its October 2023 peak of 7.79%, as of May 16 the average fixed mortgage rate sat at 7.02%.
Overall, the report states, the trends signal good news for the senior living sector with older homeowners in a good position to sell their homes, particularly those in the upper-end market, according to data from the National Association of Realtors. For homes priced at $1 million or higher, inventory and sales increased by 34% and 40%, respectively, from a year ago.
