About one-third of the top 99 US metro markets showed penetration rates that contradicted conventional income-based forecasting models, according to research released by the National Investment Center for Seniors Housing and Care in February and discussed during a June 25 webinar, according to Senior Housing News.
TL;DR: NIC research found market penetration rates depend more on cultural alignment, affordability perception, workforce availability, and policy factors than on income levels or older adult poverty rates alone—challenging standard market-entry models for operators.
The analysis examined how factors beyond household income and poverty rates determine whether older adults enter assisted living communities. Omar Zarhaoui, NIC Senior Principal, presented the findings during the webinar, noting that some markets with lower activities-for-daily-living prevalence still demonstrated higher penetration rates.
Cultural and Perception Barriers Override Economic Indicators
Markets with high incomes, more married couples, and lower older adult poverty can show strong potential demand but fail to convert that demand into actual occupancy, the research showed. Zarhaoui said cultural awareness and consumer perception of assisted living create measurable impacts on penetration outcomes—multi-generational caregiving traditions delay transitions in some markets, while product misconceptions limit adoption in others.
“Need alone does not determine adoption,” Zarhaoui said during the webinar. “Some markets with lower [activities for daily living] prevalence still demonstrated higher penetration, which suggests that even assisted living can sometimes be a proactive decision shaped by awareness, planning, consumer preferences and market position, not just a reactive response to decline in health.”
David Mills, president and chief operating officer of AgeWell Senior Living, said consumers often don’t understand what senior living is or who it serves, representing one of the industry’s largest barriers. The sector must improve public education efforts, including media outreach, according to Mills.
Gaurie Rodman, vice president of real estate strategy with Direct Supply, told webinar attendees that many consumers view senior living as a “Band-Aid solution” rather than recognizing communities can measurably improve quality of life and maintain vitality. She defined the consumer base broadly—adult children, workforce, regulators, and public policy makers all shape market outcomes.
Affordability Perception Shapes Demand More Than Actual Cost
Fee Stubblefield, founder and CEO of The Springs Living, described an instance where one of the operator’s communities switched to private-pay assisted living offerings years ago, resulting in leasing activity “drying up”—a shift attributed to changes in affordability perception among prospective residents.
Rodman said the industry should reframe cost conversations around wellness benefits rather than leading with care expenses. “We need to switch the conversation to a wellness conversation around living in isolation in your home or having home health come for an hour or two,” Rodman said. “What happens when you’re alone and not connecting with human beings … There is scientific evidence about the fact that that fundamentally changes your opinion, and brings vitality and hope.”
Assisted living residents relying on Medicare and Medicaid face particular affordability challenges, according to webinar participants. Markets where operators successfully communicate the wellness-to-cost value proposition appear to sustain higher penetration rates regardless of raw income levels, the research indicated.
Workforce Availability Acts as Penetration Constraint
Staffing availability functions as a “quiet engine behind future penetration curves,” Zarhaoui said, with markets maintaining strong caregiver and nursing assistant pipelines better positioned to support higher penetration over time. Regional workforce development programs and licensure requirements create variation in operators’ ability to staff new units, independent of resident demand signals.
The research suggests operators must understand evolving consumer preferences and engage families earlier in the decision process to make assisted living a proactive choice rather than a crisis-driven response, Zarhaoui said. Earlier engagement correlates with stronger penetration rates in markets where operators deploy family caregiver education campaigns, according to the findings.
Context and Outlook
The NIC findings challenge standard market-entry models that weight median household income and older adult poverty rates as primary penetration predictors. Senior living marketing leads planning geographic expansion now face a more complex assessment framework—cultural acceptance, workforce density, and affordability perception may override traditional economic indicators in determining whether a metro market can sustain new inventory. Operators entering markets with favorable demographics but low historical penetration should budget for multi-year consumer education campaigns to shift awareness before expecting absorption rates matching higher-penetration comparables.
The research aligns with broader industry moves toward family decision journey mapping and earlier-stage engagement. Operators that treat assisted living as a proactive wellness decision rather than a late-stage care intervention report stronger referral conversion and lower move-out rates, according to industry benchmarking data. Zarhaoui noted that many penetration-limiting factors can be addressed through targeted consumer education, workforce development partnerships, and transparent cost-comparison tools—variables operators and state associations can influence through coordinated marketing and policy advocacy rather than waiting for organic market evolution.
