Plainview Housing Study Overview Presented to: Plainview Economic - PowerPoint PPT Presentation

Plainview Housing Study Overview Presented to: Plainview Economic Development Authority Presented by: Matt Mullins | Maxfield Research Inc. May 12, 2015

Who we are Maxfield Research Inc. is a full-service real estate Overview advisory company providing strategic value to our private and public sector client’s real estate activities.  30 years experience  Diverse client base  Multi-Industry Capable residential commercial public + private sectors

Project Scope OBJECTIVE Provide custom comprehensive housing study Identify current & future housing needs for residents in Plainview and APPROACH provide framework for meeting housing needs Short and long-term housing needs • PROJECT DELIVERABLES Recommendations guiding future housing development • Tools/policies to implement the plan • Data collection: 4 th Quarter 2014 and 1 st Quarter 2015 • Draft: February 2015 KEY DATES • Presentation: May 12, 2015 • Final: TBD •

End User Benefits • Guide policy making decisions • Assist the Comprehensive Planning process • Assists area banks and lending-institutions to streamline the financial component • Solicit interest from builders/developers and help streamline the process • Help raise funding for housing and community development programs • Better define the relationship between housing and economic development • Create framework for accommodating future growth • Help deliver strategic housing priorities

Housing Study Components Development Demographics Housing Programs Pipeline For-Sale Market Housing Demand Employment Analysis Analysis Household Housing Challenges & Characteristics Affordability Opportunities Rental Market Senior Housing Recommendations Analysis Market Analysis

Deep-dive into Property Types GO Rental Housing For-Sale • Single-family • Affordable • Multifamily • Subsidized • Market rate Residential Lot Supply Senior Housing • Subsidized/affordable • Active adult • Congregate • Assisted living • Memory care • Skilled Nursing

Market Area  Defined as: • Plainview • 7 Townships • 2 Cities  Market Area will account for about 75%+ of Demand

Steady growth through 2020 Historic Findings Population Trends  Plainview last decade 10,000 Remainder of PMA 9,000  Population +150 (+4.7%) Plainview 8,000  7,000 Households +121 (+10.5%) Population 6,000 4,630 4,440 4,314 5,000 4,000  Market Area last decade 3,000  Population +276 (+3.7%) 2,000 3,540 3,340 3,190 1,000  Households +252 (+9.5%) 0 2000 2010 2020 Year Projections (2010-2020) Household Trends 3,500  Stronger growth projected over the Remainder of PMA 3,000 Plainview current decade 2,500 Plainview 1,825 Households 1,628 2,000 1,497  Population +200 (+6.0%) 1,500  Households +132 (+10.3%) 1,000 1,410 1,278 1,157 500 Market Area 0  Population +390 (+5.0%) 2000 2010 2020 Year  Households +329 (+11.3%)

Younger adults & younger seniors driving growth  Population (2014-2020):  Household size is decreasing: 35-44 projected to have largest growth 2000: 2.76 | 2010: 2.61 | 2020: 2.51 • (+57%) of total population Strong growth in school-aged children  82% Home ownership rate (2010) • 83% Remainder of Market Area •  Growth in specific older age cohorts: 82% Plainview • 55-64 projected to grow by 47 (15%) 73% Minnesota • • 65-74 projected to increase by 44 (21%) • Plainview Age Distribution 2014 to 2020 85+ -1.8% 75 to 84 -6.6% 65 to 74 19.0% 55 to 64 13.5% Age Group 45 to 54 -11.3% 35 to 44 24.6% 25 to 34 -5.3% 18 to 24 -4.7% Under 18 9.4% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Pct. Change

Household Income  Highest earners between 45-54 age cohort  Median Income (2014): (2014) • $52,797 – Plainview $66,234 – Plainview • $60,227 – Market Area • $76,397 - Market Area • $60,500 – Olmsted Cty. • • $58,634 - Minnesota  2014 Median income (Plainview)  Projected increase by 2020: Non-seniors: $58,865 • +10.9% to $58,558 (Plainview) • Seniors: $44,222 • +14.7% to $69,060 (Market Area) •  2012 Income disparity by tenure (Plainview): $56,574 (owner) vs. $25,495 (renter) • Growth and Income Trends by Age of Householder Plainview: 2014 & 2020 400 $90,000 2014 2020 2014 Median Income $80,000 $66,234 $70,000 300 314 $58,321 $63,380 $60,000 $54,333 Households 249 Income $50,000 $43,407 239 235 227 200 224 222 $28,525 205 $40,000 177 177 176 $30,000 148 $22,733 100 $20,000 $10,000 54 51 0 $0 Under 25 25 - 34 35 - 44 45 - 54 55 - 64 65 - 74 75+ Age of Householder

Plainview is a job exporter Employment  Plainview is an exporter of workers  Wabasha County: historically slightly • 30% of Plainview residents lower unemployment rate than MN. work in Plainview  Key Wabasha Co. Industry Sector Jobs: • 37% commute to Rochester  Manufacturing: 25% • -322 net outflow  Trade, Transportation, & Utilities:  Avg. weekly wages 20% Plainview: $627 • Wabasha County: $636 Annual Average Resident Unemployment Rate • Wabasha County, Rochester MSA and Minnesota Olmsted County: $1,023 2000 to 2014 • 9.0% Minnesota: $964 • Wabasha County 8.0% Rochester MSA 7.0% Minnesota Unemployment Rate 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 00' 01' 02' 03' 04' 05' 06' 07' 08' 09' 10' 11' 12' 13' 14' Year

Slowdown in housing starts since recession… New Construction Activity American Community Survey (2012)  Housing stock (Plainview):  208 housing units constructed in Plainview • 25% built prior to 1940 (2000-2013) • 15% built in the 1990s Avg. 15 units/year • • 14% built in the 2000s 2008-2013: 5 units/year • 90+% of total permits for single-family •  Single Family Detached: 82% of all homes owner-occupied housing structures New Construction (Units) City of Plainview, 2000-2013  71% of Plainview owners have 60 mortgage Multifamily 50 Single-family 40 Units 30 20 10 0 Year

Few rental market properties in Plainview Market Rate American Community Survey (2012)  Smaller rental complexes  Single-family rentals |28% of all (8 units or under) renter units in Plainview  Rent range:  Single-family + duplexes | 39% of 2BR: $550 to $600 all renter-units in Plainview •  Est. price per sq. ft. $0.65  Mobile homes account for 16% of  Olmsted Cty: $0.97 all renter units in Plainview Subsidized/ Affordable  52 units | 3 projects  0% vacancy rate  14 vouchers in Plainview--- administered by SEMMHRA Eastwood Apartments 5% Vacancy = Market Equilibrium

Housing Cost Burden % lower than state averages Cost Burden : more than 30% of gross income allocated to housing Rental: Owners:  35% of Plainview renters are cost burdened  23% of owners are cost burdened • 49% Wabasha Co. | 49% Minnesota • 23% Wabasha Co. | 25% Minnesota  47% of renter HHDS > $35k are cost burdened  50% of owners HHDS > $50k are cost burdened • 68% Wabasha Co. | 77% Minnesota • 45% Wabasha Co. | 52% Minnesota

Low senior vacancy rates Market Area Overall Subsidized/disabled  40 units | 0% vac. rate  76 units | 3 projects  Rents based on income  0% vacancy rate Market Rate  18 units congregate  18 units assisted living  All units located at Greenwood Prairie Place Plainview Senior Housing 5%-7% Vacancy = Market Equilibrium Greenwood Prairie Place

Home pricing improving and near last decade’s peak Overall Resales  Market activity improving  Median sales price:  Low inventory Peaked in 2005: $142,382 • Resales peaked in ‘05: 70  New construction market slow in • +41%: 2000 to 2014 • Plainview PSF: $72 (2014) • Plainview Housing Resales - 2000 to 2014 $200,000 80 Resales Median Sold Price Average Sold Price $180,000 70 70 $160,000 65 60 60 $140,000 57 53 50 53 $120,000 Sales Price 49 48 Resales 47 47 44 $100,000 40 43 43 42 40 $80,000 30 $60,000 20 $40,000 10 $20,000 $0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Year

Supply Side Active Listings (October 2014) Avg. Price Per Sq. Ft.  20 listings in Plainview  Single-family: $114/PSF  Median price: $135,200  PSF by type: 1.5-story: $74/PSF  Average price: $172,975 • Two-story: $103/PSF •  All single-family listings Plainview Active Listings - October 2014 7 6 6 5 5 # of Listings 4 3 3 2 2 2 1 1 1 0 0 Under $100k to $150k to $200k to $250k to $300k to $400k to $500k+ $100k $149.9k $199.9k $249.9k $299.9k $399.9k $499.9k List Price

New Construction is stagnant since recession Lot Inventory/Supply New Construction Market  35 vacant lots | 5 subdivisions  Few housing starts in Plainview  Most vacant lots platted for townhomes  Spec too risky in today’s market  No new lots platted since 2003  Lack of quality move-up lots  Newer subdivisions  Build-to-suite premium ($150 PSF+)  Avg. lot cost: $32,600  No pending projects in development pipeline  Home value w/lot: $162k (per Assessor)  Avg. lot size: 0.33 acres