Inflation adds element of uncertainty to home care deals

January 1, 1970

Investors on the prowl for home care and hospice properties are encountering two  somewhat unfamiliar obstacles: rising inflation and interest rates — the likes of which the industry hasn’t seen in 40 years.

“We’re not in uncharted waters with inflation, but the charts are so old they may have dragons on them,” Tom Lillis, a partner in M&A advisory firm Stoneridge Partners, said jokingly to McKnight’s Home Care Daily Pulse.

Recent developments present a sobering reality. On Wednesday, the Federal Reserve Board hiked short-term interest rates a quarter of a percentage point and is expected to hike them at least six more times this year. The Fed’s move followed February’s 0.8% rise in the Consumer Price Index, which is up 7.9% in the past 12 months.

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