Author Topic: Senior Care/Assisted Living Real Estate & Business?  (Read 674 times)

jeromedawg

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Senior Care/Assisted Living Real Estate & Business?
« on: May 22, 2018, 12:08:27 PM »
Hey all,

So the idea of this has slowly been marinating in my mind as a meshing of my interest in real estate and my wife's concern for the elderly. I've been wanting to get into a more 'hands-on' form of real estate versus investing in REITs (in which case I'm not really invested all that much), and I've been subscribing to MLS listings via my realtor. I've seen several properties that have come up as assisted-living homes for sale where the owner is selling either the property or business or both. This is in SoCal BTW so pricing is pretty high in general. But I am curious to know more about the business and wondering if any of you here have done or are doing this, or if you are familiar at all. My wife has expressed to me that she enjoys spending time with and caring for the elderly - it's one of her passions. I think she would have been great if she had gone into nursing (she got her degree in Math and Accounting). In any case, I realize that just because you like to do something doesn't necessarily mean that it would be great to do as a job. At the same time, if you can get paid for something you don't consider "work" all the better right?! I feel like it is sort of a glass half-full/glass half-empty kind of thing...

Anyway, just wanted to get some input/feedback on these kinds of opportunities and some of your experiences or experiences that you've heard of directly/indirectly. We have two small kids and may try for one more. So this isn't something immediately on the radar in the near-term. Possibly more of a longer-term idea that could lead to supporting us more 'passively' in the future and long-run.

jeromedawg

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Re: Senior Care/Assisted Living Real Estate & Business?
« Reply #1 on: May 22, 2018, 01:06:43 PM »
I know of franchises too that provision this (like Home Instead). I'm just not quite sure about the business model - for franchises like that it seems you buy a 'region' (is it a physical location?) and then you hire a team of caregivers who then go out to make in-home visitations and provide care in the immediate area.

profnot

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Re: Senior Care/Assisted Living Real Estate & Business?
« Reply #2 on: June 03, 2018, 08:44:22 PM »
I've been following this sector of real estate for over 4 years.

The Assisted Living market is overbuilt at the moment.  More rooms than residents.

CCRCs take big bucks.  Not for the beginning investor unless you are part of a pool

More nursing home beds are needed.  This is more of a medical industry than a real estate industry.  Very complicated business to run.

What is very high demand and low supply is affordable 55+ apartments for seniors who are independent or need a bit of caregiving.  Properties must have elevators, panic buttons, grab bars, etc. 

This is the industry sector I have been studying.  "Affordable" will always be in high demand and low supply.  I won't make 20% ROI, like in regular apartments but I'm happy with getting 15% and helping the elderly.  Just rent to people getting social security checks so you have dependable rent payers.

Look to the BiggerPockets website for real estate info. 

If interested in senior housing, start studying that industry.  There are some terrific free newsletters.


Or you and your wife might want to focus on the caregiving end.  HUGE shortages nationwide with almost all nursing homes nationwide.  Perhaps you could start a low-cost training and certification program for caregivers and then pay them top dollar for in-home care.  They would never leave high paying work and you would make a margin on their in-home service gigs.

LOTS of opportunity in this sector.  Good luck!

lhamo

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Re: Senior Care/Assisted Living Real Estate & Business?
« Reply #3 on: June 03, 2018, 08:53:44 PM »
It looks to me that what you are talking about is Adult Family Homes (at least that is what they are called here in WA).  One of the reasons we decided against that model when our mom was looking for an assisted living situation is that in a small family-based setting it is really hard to predict who the other patients will be.  If you get a house full of kind, relatively alert folks like my mom, you are golden.  But chances are there will be at least a few with dementia, and sometimes that can create problems.  Yes, mom ended up with a few people with milder dementia in her assisted living facility.  But there were enough alert folks around that she made some friends.  One of the dementia patients who got violent was asked to leave immediately -- risk to staff and other residents.

Caregiving is hard work, and here in Seattle most CNAs are recent immigrants.  Lots of people job hop pretty regularly.  And you have to keep up with the legal staffing requirements, so having a way to get people in quickly is important.