Key Factors Affecting Valuation for Senior Apartments
by Jonathan A. Wiley and David Wyman,
published in the Journal of Real Estate Research
The objectives of The Appraisers Research Foundation (TARF) are to facilitate the research, testing and report development of new methodologies, techniques or procedures to best serve the publics who use, own or control property interests. TARF does not warrant or express an opinion of the analysis or conclusions expressed in the research articles found on the TARF website. TARF does not verify the underlying data, procedure(s) or methodology used by the various authors of the research articles found on the TARF website. Reliance on the information found on the website is solely upon the user of the information.
The following article has been included in the TARF website with permission from The American Real Estate Society. The article, Key Factors Affecting Valuation for Senior Apartments by Jonathan A. Wiley and David Wyman, was published in the Journal of Real Estate Research in Volume 34, No. 2, 2012. Author contact information is found at the end of the article.
The value of senior apartments is estimated relative to traditional apartments in 34 markets in the United States. In some markets, senior apartments transact at higher prices than predicted; in others, at a discount. Market differences in the valuation of senior apartments are examined. Several attributes are found to have a significant impact and become capitalized into differential values for senior apartments including the supply of apartments per senior resident, housing prices, market size, education, and life expectancy. Other variables appear to have no effect, including rent and income, suggesting that the price impact is symmetrical for senior and traditional apartments.