DRAFT MONT MONTGOMERY C GOMERY COUNTY OUNTY HOUSING NEEDS ASSESS HOUSING NEEDS ASSESSMENT MENT A PRIL 2020
DRAFT Background Montgomery County, Maryland (“the County” or “ MoCo ”) contracted with HR&A and LSA to assess the County’s current and future housing needs. To do so, the team undertook the following workstream to develop an understanding of both historical and projected trends in the County. Demographic Trends and Demographic Assumptions and Current Housing Needs Future Housing Needs HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 2
DRAFT Background This study recognizes and builds upon several past and ongoing studies, with a goal of informing the housing portions of the Thrive Montgomery 2050 Plan. Past County Studies Past Regional Studies Ongoing County Efforts Rental Older MWCOG Regional Housing Affordability ADUs Housing Study Adults Housing Needs Preservation Study Demographic, Housing, Thrive Montgomery 2050 Missing Middle Economic Trends General Plan HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 3
DRAFT Geographic Study Area | Region Throughout the document, the “region” refers to a peer set of counties in the metropolitan D.C. area, listed below. These are the same geographies used in the MWCOG’s regional housing needs report, The Future of Housing in Greater Washington , with the addition of adjacent Howard County. Map of Regional Study Area County Population (2018) List of counties, ranked by largest to Housing Gap in Montgomery County by AMI Band, 2018 smallest population: Frederick 255K Fairfax County • Montg tgomery omery County (MoCo Co) • Howard Prince George’s County 323K • MoCo District of Columbia (DC) • Loudoun 1.05M Prince Prince William County 407K • George’s Loudoun County • 909K DC Howard County 702K • Fairfax Arlington Frederick County • 1.15M 238K Arlington County • Prince William Alexandria 468K Charles County 160K • Charles Alexandria city County • 162K Source: U.S. Census Bureau, Population Division HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 4
DRAFT Geographic Study Area | Submarkets Some figures in the document refer to county submarkets, defined and provided by the Planning Department. These submarkets, and their relative sizes, are indicated below. Map of Intra-County Study Area Submarket List of submarkets Population (2018) 1 Bennett/Clarksburg/Damacus/Dickerson/ Lower Seneca/Poolesville/Goshen 2 Darnestown/Travilah 3 North Bethesda and Rockville 1 4 Gaithersburg City and Vicinity 9 70K 40K 5 Cloverly/Patuxent 7 81K 6 Fairland/White Oak 4 7 7 Germantown 150K 5 13 28K 8 8 Aspen Hill 14K 8 2 9 Olney 40K 65K 3 10 Potomac 6 114K 81K 15 11 Silver Spring 100K 10 12 Takoma Park/Kemp Mill/4 Corners 48K 12 13 Upper Rock Creek 14 74K 93K 14 Bethesda/Chevy Chase 11 42K 15 Kensington/Wheaton Source: U.S. Census Bureau, Population Division HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 5
DRAFT Demographic Trends and Current Housing Needs
DRAFT Approach and Key Findings Our demographic analysis covers the following major indicators of housing need. Overall Growth - Steady growth in households, with low capture of regional growth - Building permits indicate supply constraints despite growth - Household growth concentrated near transit Tenure - Homeownership rate falling, driven by fewer young owners, low-income owners, and white owners - Almost every submarket is adding renter households; few are adding owners Income and Affordability - “Barbell” growth in low - and high-income households - Low-income households highly cost-burdened - Supply gap exists for households earning up to 65% AMI; widening gaps driven by high demand Household Size and Unit Type - Household sizes are rising due to larger renter HHs, driving an increase in single-family rentals - 1 in 7 renter households are overcrowded - 1 in 3 owner households are over-housed HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 7
DRAFT OVERALL GROWTH TENURE INCOME HOUSEHOLD SIZE HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 8
DRAFT Positive but decelerating population and household growth Population Growth Rate, 2011 - 2018 Number of Households, 2010-2018 2.0% 395,000 390,655 HHs 1.8% 1.9% 390,000 1.6% 1.6% 1.4% 385,000 1.2% 380,000 1.0% 0.8% 0.8% 375,000 0.6% +14,700 HHs 0.4% 0.5% Annual Growth 0.4% 370,000 0.2% 365,000 0.0% 2011 2012 2013 2014 2015 2016 2017 2018 Mongtomgery County Region Total Source: 2009-2018 ACS 1-Year Estimates, Montgomery County Population Division HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 9
DRAFT Low capture of regional household growth Since 2010, the region has added roughly 150,000 households. MoCo captured 5% of that growth, a share similar to that of Fairfax County. Household Growth, 2010 – 2018 Ranked by largest to smallest percent change in households Share of Regional Percent Change in Change in Households Households Loudoun County 30% 19% Arlington County 18% 10% Frederick County 14% 7% District of Columbia 14% 21% Charles County 13% 4% Alexandria City 11% 5% Howard County 11% 7% Prince William County 10% 8% Prince George's County 5% 8% Montgomery County 2% 2% 5% 5% Fairfax County 2% 4% *Share of Regional Change indicates each jurisdiction’s capture of total regional growth. Percent change indicates growth rat e within each jurisdiction. Source: Montgomery County Population Division; 2010 and 2018 ACS 1-Year Estimates HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 10
DRAFT Limited new construction creates supply constraints Residential Building Permits and Population, 2000 - 2018 6000 1,200,000 5000 1,000,000 Residential Building Permits 4000 800,000 Population 3000 600,000 2000 400,000 1000 200,000 0 0 2000 - 2010 2010 - 2018 Growth in Households (CAGR) 0.77% 0.53% Growth in Housing Units (CAGR) 0.96% 0.48% Source: U.S. Census Building Permit Survey, Montgomery County, Population Division HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 11
DRAFT Household growth highest along the metro line and I-270 Silver Spring and North Bethesda and Rockville saw the highest concentration of growth between 2010 and 2018. The Takoma Park submarket lost the most households on net. Cha Change nge in in Households Households Per Per Squar Square Mile, Mile, 2010 2010-2018 2018 Change in Group Total HHs, 2010-2018 3641 1 Bennett -277 2 Darnestown/Travilah 4957 3 N. Bethesda and Rockville 9 1 2079 4 Gaithersburg City 7 474 5 Cloverly/Patuxent 183 6 Fairland/White Oak 4 5 304 7 Germantown 13 467 8 Aspen Hill 8 2 63 9 Olney 6 3 -17 10 Potomac 15 > 100 3410 11 Silver Spring 10 12 -375 12 Takoma Park 11 0 14 575 13 Upper Rock Creek 256 14 Bethesda/Chevy Chase < -40 1310 15 Kensington/Wheaton Source: 2010-2018 ACS 5-Year Estimates HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 12
DRAFT OVERALL GROWTH TENURE INCOME HOUSEHOLD SIZE HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 13
DRAFT Ownership rate high but in decline, following regional trend Homeownership Rate, 2010-2018 70% 68% 69% 66% 64% 65% 65% 62% 62% 60% 58% 56% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Regional Average Montgomery County Source: 2009-2018 ACS 1-Year Estimates HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 14
DRAFT Owning unaffordable to median HH, driven by interest rates Homeownership Affordability, 2010 - 2018 $150,000 10.0% $140,000 9.0% $125,621 $130,000 8.0% Household Income Required to Afford the Median Home Value $120,000 7.0% $108,188 $110,000 6.0% $100,000 Actual Median Household income 5.0% $90,000 4.0% $80,000 3.0% 30-Year Fixed Rate Mortgage $70,000 2.0% $60,000 1.0% $50,000 0.0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 *2018 inflation-adjusted dollars Source: Zillow, Federal Reserve Economic Data HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 15
DRAFT Only $150K+ segment adding owners on net, post-recession $150K is just under 120% AMI for a household of 4. Ownership for households earning below that has not recovered since the last recession. Change in Number of Owner-Occupied Housing Units by Household Income 2000 – 2010 2010 – 2018 Less than $25K 4,619 -725 $25 to 50K 10,331 -5,167 $50 to 75K 7,858 -6,574 $75 to 100K 2,632 -5,378 $100 to $150K 4,228 -6,528 $150K+ -7,861 21,820 Source: 2014-2018 ACS 5-Year Estimates HR&A Advisors, Inc. Montgomery County Housing Needs Assessment| 16
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