When it comes to Southern California—“there are no markets better than that,” Will says. However, it’s a region with high barriers to entry and a tighter labor market—which could translate into higher rents that can be justified to higher-end tenants. Rothschild singles out San Diego, with its ideal location on the coast and near other top communities, as a strong market. While it can take years before construction can start on a development there, it is that difficulty that can make it more attractive. “Because of that, it’s a good marketplace,” he says. Further north, San Francisco is a city that is always in strong demand—if there is space available. “If you have a piece of dirt or if you have a building, you can get a deal done,” Rothschild says. NIC ranks San Jose as having the highest occupancy in the country.
Arizona, also well-known as a top locale for seniors, ranked third on MoneyRates.com’s ranking of the top states for retirees. One of the state’s draws is its abundant sunshine. It’s also a market that has already seen a lot of supply, Rothschild says, but its absorption rate has also been strong.
“Some of the Florida markets have seen a tremendous amount of supply,” in particular cities including Tampa and Orlando, Will says. Still, the Sunshine State—known for its good weather—is regarded as one of the top retirement destinations in the country. Florida landed fourth on MoneyRates.com’s ranking of the top five states, largely because it has the highest over-65 proportion in the U.S., and because life expectancy at age 65 there is the third-highest in the union. One concern to watch for is that a lot of new development in prominent retirement markets is more expensive, and a lot of seniors saw a drop in their wealth after the recession, Binder says.
States in the Northeast have seen a lot of seniors housing development on or near university campuses, which appeals to alumni seeking the amenities college towns can offer, Binder says. Maine specifically was recently ranked as one of the top five states in the country for retirement by MoneyRates.com, given its low crime statistics and the fact that it has the second-highest proportion of population over the age of 65 in the country. “[That] says something about the quality of life that people tend to find there,” says Richard Barrington, a personal financial expert for the website. Binder says Maine could appeal to those seeking to live in a cultural and outdoors-y state that is also within driving distance of other major East Coast cities. Vermont and New Hampshire also made MoneyRates.com’s top 10 list.
Seattle, in particular, is a city undergoing a lot of construction, thanks to the tech giants who house their offices there, and it may be a good market for seniors housing, says Rothschild. “People are looking at urban markets a lot more, and there seems to be opportunity there,” he notes.