How to Value a Nursing Home for Sale



The nursing care industry is constantly growing due to the nature of the demands it serves. The industry is on an upward swing, which is great news if you’re looking to enter the business and purchase a facility. One of the most important steps in the selling process is making sure you receive the best price possible. Utilize Sunbelt’s tips to properly value a nursing home in order to properly list your nursing home for sale and attract buyers.

Tips to Properly Value a Nursing Home

Determining the value of a nursing home in Raleigh, NC is similar to the process of valuing any other business. Keep the steps of valuation in mind, and supplement your appraisal with specifics in the industry.

Basic Business Valuations

The two most basic factors to consider when valuing any business are cash flow and risk. Ultimately a buyer purchases a business for the sake of income, and the higher the income, the more a buyer is likely willing to pay. A proper valuation should also assess the potential risk of acquiring the business. A professional can determine this value, which is often referred to as a Discount Rate or Capitalization Rate.

To learn more about valuing a business, visit our business valuations page.

Nursing Home Specificsimage of a nursing home

After factoring in fundamental business valuation elements, you should consider issues that are unique to the nursing home industry.

Nursing homes serve a need that will always be in demand, making them sound business investments. However, be aware that just because the overall industry performs well, it does not mean every nursing home business is a promising investment.

When valuing the nursing home, consider earnings, revenue, the number of units, and square footage of the facility. Generally, a good indicator of a successful nursing home is one that has at least an 80% occupancy rate. These factors will all help you devise a proper valuation.

It’s also beneficial to compare the nursing home with other care facilities in the Greater Raleigh, NC area. How is it comparing in terms of revenue, occupancy, and the overall condition of the building? Health care facilities need to be furnished with the proper equipment to best serve their residents. Examine the nursing home for any possible damages and additional costs required for renovation or updating.

Sunbelt Business Brokers of Raleigh

Valuing a business is a complicated process, and an improper valuation can throw off an entire business deal. Make sure you’re listing your Raleigh nursing home for the correct price with help from Sunbelt Business Brokers of Raleigh! With over 30 years of experience in the industry, our team will help you close your deals.

Contact Sunbelt Business Brokers of Raleigh today for help valuing a nursing home or selling any other type of business in the Raleigh area.


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