The total price per bed for nursing homes jumped nearly 22% during the first quarter of 2021, increasing after four straight years of year-over-year losses, according to a new housing survey by JLL Valuation Advisory, a professional services firm that specializes in real estate and investment management.
The average price per bed rose to $90,700 during the first quarter, which is the second-highest annual price point for nursing homes on record, according to the report. Gains are largely attributed to government stimulus funds, including about $4.9 billion sent to nursing homes from HHS and $100 billion sent to qualified healthcare providers from the CARES Act, which helped operators maintain cash flows, the report said.
"Investors remain bullish on seniors housing and care investments," Zach Bowyer, JLL managing director and head of alternatives asset sectors, valuation advisory, said in a statement. "We anticipate market fundamentals to steadily improve and the market to re-stabilize between two and four years, depending on the location."
Nursing care volume was buoyed by government support and came in at $3.5 billion in 2020, a decrease of 35% year-over-year, compared with a 46% decrease in the seniors housing sector, according to JLL.
More than half of survey respondents said the plan to increase their exposure in the sector.