How to Buy an Assisted Living Facility (2026 Guide)

Reviewed by the Regalis Capital acquisitions team. Last updated June 2026.

Buying an assisted living facility is not the same as buying a Main Street service business. You are buying a licensed, regulated care operation where the asking price is driven by beds, occupancy, and the real estate, and where the deal does not close until a state agency signs off on the new operator. This guide walks the whole path: what these facilities cost, what multiple they trade at, how occupancy and licensing move the value, how to finance one with an SBA 7(a) loan, and the care-specific diligence that separates a clean deal from a regulatory trap.

How much does an assisted living facility cost?

In 2026 the median assisted living facility carried a $1,500,000 asking price on $338,924 of median annual cash flow, across a market where listed prices ran from about $150,000 for a small residential care home to $25,000,000 for a large multi-building campus (Regalis deal-aggregate analysis, 2026). The spread is enormous because "assisted living facility" covers everything from a six-bed residential care home in a converted house to an 80-bed purpose-built community.

The single biggest variable is whether the real estate comes with the business. A facility sold with its building is priced on both the care operation's cash flow and the value of the property, which is why headline prices look large next to a typical Main Street business. When the operator leases the building, the purchase price drops sharply because you are buying only the licensed operation and its cash flow.

What multiple do assisted living facilities sell for?

Assisted living facilities trade at roughly 3.2x to 3.7x cash flow (SDE), with a market average near 3.7x in 2026 (Regalis deal-aggregate analysis, 2026). That is above the all-industry small business average of about 2.7x SDE, because a licensed care facility carries real estate, hard-to-replicate licensing, and a demographic tailwind that buyers pay up for. On an EBITDA basis the same facilities run closer to 3.5x to 5.0x, and larger institutional-grade communities can command more.

Here is the worked math on a representative facility priced at the market average multiple:

Worked deal math on a representative assisted living facility at the 2026 market-average SDE multiple (Regalis deal-aggregate analysis, 2026). An SDE multiple is not comparable to an EBITDA multiple; SDE includes the owner's pay, so it runs lower and its multiple is lower, which is why the same price reads as 3.7x on SDE and about 4.5x on EBITDA. Your number depends on verified cash flow, license type, occupancy, and whether real estate is included.

The wide variance is the headline. A high-occupancy facility with a clean state license and recurring private-pay residents earns the top of the range. A facility with low census, a license tied to the seller, or heavy reliance on Medicaid reimbursement trades well below it. Pull the per-industry comparison in What Is My Business Worth? SDE and EBITDA Multiples by Industry to see where assisted living sits against other categories, and run your own scenarios in the acquisition calculator.

How do licensing and bed count affect the value?

Licensing is the gate that controls value, because in most states the assisted living license is granted to a specific operator at a specific address, and it does not automatically transfer when you buy the business. A facility licensed for 40 beds is worth more than one licensed for 12, and a facility whose license is current, in good standing, and transferable is worth far more than one with open deficiencies or a license the seller cannot hand over cleanly.

Bed count drives value in two ways. More licensed beds means more revenue capacity, so a 40-bed facility at the same occupancy and rate produces more cash flow than a 20-bed facility. But licensed beds you cannot fill are dead weight: a facility licensed for 60 beds but running 35 residents is priced on the cash flow it actually produces, not on its paper capacity. The license caps your upside; occupancy decides what you actually earn.

Never assume a license transfers. Verify the exact change-of-ownership process with the state licensing agency before you commit, because a licensing delay or denial can sink a deal that looks clean on the financials.

How does occupancy drive the underwriting?

Occupancy is the number a lender underwrites first, and most lenders want to see a stabilized census around 80% before they treat the cash flow as reliable (Regalis deal-aggregate analysis, 2026). A facility running at 95% occupancy with a waitlist is a different credit than the same building running at 60%, even if the trailing financials look similar, because the lender is asking whether the cash flow will still cover the loan payment after you take over.

The reason occupancy matters more here than in most businesses is operating leverage. An assisted living facility carries high fixed costs: the building, the licensed staff, the kitchen, the insurance. Those costs barely move whether you are at 70% or 90% occupancy, so every incremental resident above breakeven flows almost straight to cash flow, and every empty bed below stabilized census drains it. A facility sold at a high occupancy that you cannot maintain will miss its debt service coverage ratio (DSCR) fast.

This is why occupancy trends matter more than a single snapshot. A facility climbing from 70% to 85% over two years is a growth story; one sliding from 90% to 75% is a warning. Ask for month-by-month census history, not just the current number, and underwrite to a conservative stabilized occupancy, not the peak.

How is an assisted living facility financed with an SBA loan?

Most assisted living acquisitions under roughly $5,000,000 are financed with an SBA 7(a) loan, which requires a minimum equity injection of 10% of the total project cost, the purchase price plus closing costs, working capital, and any other completion costs (SBA SOP 50 10 8, effective June 1, 2025). On a $1,000,000 facility, that is a $100,000 injection plus the costs of getting to close.

The structure follows the standard SBA acquisition rules:

SBA 7(a) acquisition structure under SBA SOP 50 10 8, effective June 1, 2025, applied to a representative facility price (Regalis deal-aggregate analysis, 2026). A seller note counts toward the injection only if it is on full standby, meaning no principal and no interest for the full loan term.

Four SBA rules decide whether your deal funds. First, the minimum equity injection is 10% of total project cost, not just the purchase price. Second, at least 5% of that total project cost must be genuine non-borrowed cash. Third, a seller note can only count toward the injection if it is on full standby for the life of the SBA loan, with no principal and no interest for the whole term, and even then it covers at most half of the required injection. Fourth, full standby means exactly that: a partial-standby note, or one with any payments during the term, counts as zero equity. The lender will also order an independent appraisal and cap loan proceeds at that valuation, so a price above the appraisal must be covered by a seller note behind the SBA loan or more buyer cash (SBA SOP 50 10 8, effective June 1, 2025). Separately, the lender, not the SBA, typically requires you to keep 10% to 20% post-close liquidity as a credit-policy overlay.

What care-specific diligence matters?

The single most important diligence item is the state survey and deficiency history, because open citations, a recent enforcement action, or a license on probation can block the transfer or force expensive corrections before you can operate. Pull the facility's most recent state inspection reports, confirm there are no unresolved deficiencies, and verify the license is in good standing directly with the state agency, not just from the seller's paperwork.

Beyond the license, the care-specific diligence stack covers items a standard business purchase never touches:

• Resident agreements and payer mix. Confirm how many residents are private-pay versus Medicaid or other reimbursement, because payer mix drives both the rate per resident and the cash flow stability. A facility heavy on Medicaid reimbursement earns less per bed and carries reimbursement-rate risk.
• Staffing and required ratios. Verify the facility meets state-mandated staffing ratios and that key licensed staff, including the administrator, will stay or can be replaced. A staffing shortfall is both a compliance risk and a hidden cost.
• The real estate and physical plant. If the building is included, get a property condition assessment. Aging HVAC, roofing, life-safety systems, and ADA compliance are expensive surprises in a care setting.
• Resident census and turnover. Confirm the month-by-month census and resident length-of-stay so you are underwriting real, durable occupancy, not a temporary spike.

This is where a buy-side advisor earns its keep. The financial add-backs, the license transfer, the survey history, and the occupancy trend all have to line up, and a single missed deficiency or a non-transferable license can turn a financeable deal into a dead one.

Who sources and closes the deal for you?

Regalis Capital reviews upwards of 20,000 deals a month, so the team sees what assisted living facilities are genuinely trading for in real time, what occupancy and license profiles lenders will actually finance, and which listings carry hidden regulatory baggage. We source facilities through brokers, listing networks, and off-market channels, run the three-part vetting (location, operations, and financials), pressure-test the occupancy and the add-backs, confirm the license can transfer, and structure the SBA financing so it clears underwriting.

The care-specific risk is exactly why most buyers do better with an advisor on this category than going it alone. We tell you what a facility is worth to finance and close, not just what it is listed at, and we run the deal from the first call through the state licensing approval to close.

Frequently Asked Questions

How much does an assisted living facility cost?

The median assisted living facility carried a $1,500,000 asking price on $338,924 of median cash flow in 2026, with most sales falling between roughly $1,000,000 and $3,000,000 (Regalis deal-aggregate analysis, 2026). Small residential care homes can sell under $500,000; large licensed communities run into the eight figures. Price tracks bed count, occupancy, license type, and whether the real estate is included in the sale.

What multiple do assisted living facilities sell for?

Assisted living facilities sell at roughly 3.2x to 3.7x cash flow (SDE), averaging near 3.7x in 2026 (Regalis deal-aggregate analysis, 2026). That is above the all-industry average of about 2.7x because of the real estate, the hard-to-replicate license, and the demographic tailwind. The multiple swings widely with occupancy, state license type, and bed count, so verify the cash flow before applying any multiple.

Do I need a license to own an assisted living facility?

Yes, in nearly every state. The assisted living license is granted to a specific operator at a specific address and usually does not transfer automatically when you buy the business. The sale typically closes only after the state approves you as the new operator through a change-of-ownership application and survey. Confirm the license is current, deficiency-free, and transferable before you sign, and build the approval timeline into closing.

How does occupancy affect the value?

Occupancy is the first number a lender underwrites, and most want a stabilized census around 80% before treating the cash flow as reliable (Regalis deal-aggregate analysis, 2026). Because fixed costs barely move with census, every resident above breakeven flows almost straight to cash flow, and every empty bed drains it. A facility sold at a high occupancy you cannot maintain will miss its DSCR, so underwrite to a conservative stabilized number.

Can I buy an assisted living facility with an SBA loan?

Yes. Most assisted living acquisitions under roughly $5,000,000 are financed with an SBA 7(a) loan, which requires a 10% equity injection of total project cost, with at least 5% in genuine non-borrowed cash (SBA SOP 50 10 8, effective June 1, 2025). On a $1,000,000 facility that is a $100,000 injection plus closing and working capital. A seller note counts toward the injection only on full standby for the life of the loan, capped at half the injection.

Ready to find and close the right assisted living facility?

Assisted living is one of the highest-value categories a buyer can acquire, and one of the easiest to get wrong, because the price is driven by occupancy and the close depends on a license you do not control until the state approves the transfer.

Regalis Capital reviews upwards of 20,000 deals a month. We source assisted living facilities through brokers, listing networks, and off-market channels, vet and value each one against live market data, confirm the license can transfer and the occupancy holds, structure the SBA 7(a) financing, and run the deal through state approval to close.

Start a deal assessment with Regalis Capital to find out what a facility is really worth and how to finance it.

About Regalis Capital

Regalis Capital is a buy-side acquisition advisory firm that helps buyers find, value, and close small business acquisitions. Its team reviews upwards of 20,000 deals a month.