Housing for Middle-Income Households

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Housing for Middle-Income Households Housing for Middle-Income Households AN ECONOMIC ANALYSIS OF MISSING-MIDDLE HOUSING City of Elk Grove DRAFT FEBRUARY 13, 2020 Prepared for: City of Elk Grove 8401 Laguna Palms Way Elk Grove, CA 95758 elkgrovecity.org Prepared by: 3 MacArthur Place, Suite 1100 Santa Ana CA 92707 714-966-9220 placeworks.com Contents Housing Type ......................................................................... 19 1. Introduction........................................................................... 1 Housing Unit Size ................................................................... 20 What is Missing Middle Housing ...................................................... 2 Income and Housing-Cost Trends................................................... 21 Missing-Middle Housing Products............................................... 2 Household Income .................................................................. 21 Middle-Income Households ....................................................... 2 Household Income by Age of Householder ................................. 22 Report Organization ........................................................................ 6 Sales Price for Existing Single-family Houses .............................. 23 2. National Housing Trends ............................................... 7 Sales Price for New Single-family Houses .................................. 24 Long-Term Demographic Trends ...................................................... 8 Median Rent .......................................................................... 25 Generational Dynamics ............................................................. 8 Implications of Long-term National Trends ...................................... 26 Household Changes ................................................................ 10 3. Regional Middle-Income Market .............................. 27 Multigenerational Households .................................................. 11 Household Characteristics ............................................................. 28 Households by Size................................................................. 12 Household Size ...................................................................... 28 Average Household Size .......................................................... 13 Household Size and Household Income .................................... 29 Homeownership Rate .............................................................. 14 Household Type ..................................................................... 29 Life Transitions ....................................................................... 15 Multigenerational Households .................................................. 30 Aging and Retirement .............................................................. 16 Length of Time at Current Residence ......................................... 31 Residential Development Trends .................................................... 17 Age of Householder ................................................................. 31 Housing Production ................................................................ 17 Housing Characteristics ................................................................. 33 DRAFT February 13, 2019 Page i Type of Housing ..................................................................... 33 Prototype 4: Rowhouse/Townhouse .......................................... 61 Tenure .................................................................................. 33 Multifamily Housing ..................................................................... 66 Household Size ...................................................................... 34 Prototype 5: Mixed Housing Types............................................ 66 Housing Overpayment ............................................................. 35 Prototype 6: Gardencourt Apartments ........................................ 72 City-Level Changes ....................................................................... 35 Development Feasibility Summary .................................................. 78 Housing Type ......................................................................... 35 5. Moving Forward .................................................................. 81 Average Household Size .......................................................... 36 Recommendations ........................................................................ 82 Overcrowding ......................................................................... 37 Appendix ............................................................................................. 1 Households with Children ........................................................ 37 Household Type ..................................................................... 38 Change in Age Structure .......................................................... 39 Implications of Regional Middle-Income Market ............................... 41 4. Development Feasibility ................................................... 43 Development Feasibility ................................................................ 44 Single-family Detached Housing .................................................... 45 Prototype 1: Standard Small Lot ............................................... 45 Prototype 2: Courtyard Cluster .................................................. 50 Single-Family Attached Housing ..................................................... 56 Prototype 3: Multiplexes .......................................................... 56 Page ii Housing for Middle-Income Households Figure 13: Mean Real Annual Household Income by Household Income List of Figures Quintile; United States; 1967 to 2018 ................................................. 21 Figure 1: Household Income by Quintile, Range of Middle Income, and Minimum Annual Household Income to Afford to Rent and Purchase Figure 14: Real Median Household Income by Age of Householder; 1967 Existing Housing by Type of Housing; Sacramento County; 2017 ............... 5 to 2018 ........................................................................................... 22 Figure 2: Number of Live Births, Fertility Rates, and Generational Labels; Figure 15: Case-Schiller National Index (Estimated Value of All Housing, United States; 2009 to 2018 ................................................................ 9 Jan. 2000=100), Adjusted for Inflation; United States; January 1987 to September 2019 ................................................................... 23 Figure 3: Type of Household by Share of Total Number of Households; United States; 1970 to 2017 .............................................................. 11 Figure 16: Real Median Sales Price and Real Median Sales Price per Square Foot for New Single-Family Housing; United States; 1971 to Figure 4: Multigenerational Household; United States; 1950 to 2016 ............... 12 2018 ............................................................................................... 24 Figure 5: Number of Households by Number of Persons per Household; Figure 17: Real Median Gross Rent; United States; 1970, 1980, 1990, United States; 1970 to 2019 .............................................................. 13 2000, and 2005 to 2017 .................................................................. 25 Figure 6: Average Number of Persons per Household; United States; 1970 Figure 18: Average Household Size; Sacramento County and Major Cities; to 2019 ........................................................................................... 14 2007 and 2017 ................................................................................ 28 Figure 7: Homeownership Rate by Householder Age Group; United States; Figure 19: Percentage of Income-Category Households by Number of 1970 to 2017 .................................................................................. 15 Persons per Household; Sacramento County; 2017 ................................ 29 Figure 8: Median Age at First Marriage and Mean Female Age at First Figure 20: Length of Time at Current Residence by Income Category; Birth; United States; 1959 to 2018 ..................................................... 16 Sacramento County, 2017 .................................................................. 31 Figure 9: Number of Persons and Labor Force Participation Rate for the Figure 21: Age Distribution of Households by Income Category; Population Age 65 and older; United States; 1948 to 2019 .................... 17 Sacramento County; 2017 .................................................................. 32 Figure 10: Monthly Number of Housing Units Completed; United States; Figure 22: Percentage of Households by Income Category and by Type of January 1968 to October 2019 ........................................................... 18 Housing Unit; Sacramento County; 2017 ............................................. 33 Figure 11: Single-Family Detached Housing as a Share of Total Housing Figure 23: Homeownership Rate by Housing Type and Income Category; Units Completed; United States; January 1960 to October 2019 ............. 19 Sacramento County; 2017 .................................................................. 34 Figure 12: Average Unit Size in Square Feet for Single-Family Detached Figure 24: Average Household Size by Housing Type and by Income Housing and Multifamily Housing Completions, Actual
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