Agenda - Council - 09/13/2016 - Laserfiche WebLink

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HOUSING DEMAND ANALYSIS • Based on household income trends, recent building trends, and current market conditions, we find that the majority of the for -sale multifamily demand in the Market Area is for units priced below $200,000 - or units affordable to moderate income households (to households with incomes of under about $55,000 — or about 80% of the Metro's Median Family Income for a family of three). In Ramsey, we calculate that 70% to 75% of the for -sale multifamily demand is for units priced below $200,000. This is higher than other Market Area communi- ties, such as Blaine and Coon Rapids, which are closer to the core of the Twin Cities and where land prices are higher. Overall, we calculate demand in Ramsey between 2005 and 2010 for about 690 to 775 townhome units priced below $200,000 ("affordable"). We also calculate that nearly all of the condominium demand will be for units priced below $200,000, or about 30 to 60 units. • The demand for rental housing is from households of varying incomes. Based on our demo- graphic analysis and current market conditions, we project that 50% to 55% of the rental de- mand in Ramsey between 2005 and 2010 will be for market rate units. Another 20% to 25% of demand will be for units affordable to households with incomes between 50% and 60% of median income ("affordable units"), and 25% to 30% of demand will be for units affordable to households with incomes below 50% of median income ("subsidized units"). This equates to demand in Ramsey between 2005 and 2010 for 170 to 190 market rate units, 65 to 85 affordable units, and 85 to 100 subsidized units. It should be noted that overall demand for affordable and subsidized units is greater than 150 to 185 units, however existing older market rate communities in the Market Area with moderate rents will satisfy much of this demand. Adult Few Services Senior Housing Demand Analysis Tables 26 through 28 present demand estimates for market rate, affordable, and subsidized adult/few-service senior housing in the PMA (Ramsey, Anoka, Andover, Oak Grove, and Burns Township). The following points outline the calculations/assumptions for each demand table. It should be noted that there is some market overlap between the three housing products, as many seniors would income -qualify for at least two of the three housing products. We account for this market overlap in our recommendations in the following section. Market Rate • Demand for owned and rented market rate senior housing in Ramsey is calculated in Table 26. The table calculates demand based on senior households with incomes above $25,000 in 2005 and $29,500 in 2010, including those households whose incomes would rise to this level based on proceeds gained from the sale of their single-family homes. An income of $25,000 and an allocation of 40% of that income on housing translates to an affordable monthly cost of about $830. • Seniors who own their homes also have an untapped source of equity that can be used to pur- chase a senior housing unit or to allocate toward a rental unit. For example, if a senior in the Market Area sold his/her home for $203,400 (90% of the average sale price in 2004), the pro- MAXFIELD RESEARCH INC. 53