People age. And as those people age, they will need a place to call home. Our aging population’s demand for homes may make residential assisted living investing an attractive addition to your portfolio.
As Isabelle Guarino-Smith, COO of Residential Living Academy, notes, 76 million Baby Boomers are entering the marketplace for assisted living. As a result of the Boomers' entrance into the market, Guarino-Smith argues that now is an ideal time to invest in residential assisted living.
The world is in flux, but the more things change, the more they stay the same.
People will still get old and still need a place to stay. Consider this, the fastest growing demographic is people aged 80 and older. We have better medicine, technology, and healthcare. And it's making people live longer.
Those longer-living people may need some help with their day-to-day life or medical attention to preserve their quality of life. Our aging mothers and fathers still need a safe place to call home.
In this article, we'll discuss the following:
A residential assisted living is a group home that helps with the activities of daily living for the seniors who live there.
Instead, a RAL is a residential home in a single-family home residential neighborhood. Typically, an owner or operator renovates these homes with age-appropriate furniture and furnishings, especially the rooms and bathrooms.
There are three primary ways you can get involved in residential assisted living investing.
You would be known as a preferred real estate provider. You would need to purchase a home, renovate it, and get it licensed and ready for the operator.
Some advantages of going this route include the following:
You work in the home and operate the business. Being an owner-operator means you'll help each senior with their day-to-day activities, including but not limited to:
You can save money by doing this, but you will invest a lot of sweat equity.
As a private lender, you provide the capital for an interested borrower who wants to operate a residential assisted living facility. Private lending is the most hands-off approach to breaking into the RAL market.
For these education examples, we will use an assisted living facility's average monthly cost of $4,500. For illustrative purposes, we'll use ten residents, which is typically the maximum number of residents that you can house:
For a more detailed breakdown of how much money you have the potential to make, check out Isabelle Gaurino-Smith's in-depth discussion of different earnings models.
There is a silver tsunami upon us composed of aging Baby Boomers. More than 76 million boomers are aging and are looking for places to live that are conducive to their lifestyle.
One possible place that boomers will call home is residential assisted living (RAL) homes.
RAL properties have several advantages that may make you want to include them in your investment strategy:
The demand appears to remain strong as people live longer, so now may be an opportune time to invest in the emerging RAL marketplace.
Do you have questions about how to get started in residential assisted living investing or real estate investing in general?
Join our FREE Royal Investing Group Mentoring, where we meet weekly to discuss the nuances, challenges, and solutions involved with your real estate investments.
Scott Royal Smith is an asset protection attorney and long-time real estate investor. He's on a mission to help fellow investors free their time, protect their assets, and create lasting wealth.
Ready to know more than your attorney? Join our community platform where you'll get immediate FREE access to all our best educational resources for real estate investors. Including 8 Masterclasses, group mentoring replays, and much, much more.
Join thousands of real estate investors in all 50 states as they enjoy exclusive content, special promotions, and behind-the-scenes access to me and my guests. No spam, ever. Just great stuff!