"1 I 3 308 F?2 I Fltnt, I I Mich L969 I W"Ptfr.e FLINT, MICHIGAN HOUSING MARKET as of June 1, 1969 A RePort bY the DEPARTMENToFHoUsINGANDURBANDEVEToPMENT FED ERAL HOUSI NG ADMIN ISTR,ATION WASHINGTON, D.C.2O11I Scptembcr 1969 AT{ALYSIS OF THE FLINT, MICHIGAIiI HOUSING MARKET AS 0F JUNE r, 1969 A Report by the DEPARTI.TENT OF HOUSING ANi URBAN DEVELOPT,IEI{T FEDERAL HOUSING ADMINISTRATION WASHINGf,ON, D.C. 2O4LL FHA Housing Market Analysis Flint, Michigan, as of June 1, L969 Forewo rd This analysis has been prepared for the assistance and guidance of the Federal Housing Administration in its operations. The factual information, find- ings, and conclusions may be useful also to build- ers, mortgagees, and other^sconcerned rriLh local housing problems and trends. The analysis does not purport to make determinations with respect to the acceptability of any particular mortgage insurance proposals that may be under consideration ln the subject locality. The factual framework for this analysis was devel- oped by the Field Market Analysis Service as thor- oughly as possible on the basis of information available on Ehe "as of', date from both local and natlonal sources. 0f course, estimates and judg- ments made on the basis of informatlon avallable on the I'as ofil date may be modtfted conslderably by subsequent market developments. The prospective dernand or occupancy potentials ex- pressed in the analysis are based upon an evalua- tion of the factors available on the ',as of" date. They cannot be construed as forecasts of building act ivli ty; rather, they express the prospect ive housing prodrrction which would maintain a reason- able balance in demand-supply retationships under cond jtions analyzed for the ',as of" date. Department of Housing and Urban Development Fecleral llous irrg AcJmini stratirrn Fic-rlcl Mnrket Arralysls Serrvit:c t'lashinAt.on, D. C. FHA HOUSING MARKET ANALYSIS - FLINT MICHIGAN AS OF JUNE 1 t969 The Flint, Housing Market Area (Hl4A) is defined as Genesee County Michigan. The HMA, locaEed in east central Michigan, has a current population of 4621900, most of which is concentrated in the city of Flint and immediately adjacenE areas. The economy is heavily depen- denE upon manufacturing industries and particularly upon the produc- tion of automobiles and automobile parts. Nonmanufacturing wage and salary employment increased by 6oo (net) during the 1966-1968 period. rncreases in nonmanufacturing industries balanced net. declines in manufacturing during Ehe period. Employment, cutbacks did not seriously affect the housing market, and the consEruction volume has remained fairly stable in recent years. The renter vacancy rate declined, white the homeowner vacancy rate stabillzed aE r.1 percent, the result of increased population and household growth, as well as significant unit demolitions. During the next two years, emploSrment growth is expect.ed to be sright, but continued demolitions and new household formation will permit past construction levels to cont.inue. Anticipated Ho usine Demand Barring unexpected changes in the local economic, cemographic, and housing factors taken into consideration in this analysis, an average annual demand for 3r5OO new privately financed housing units i s projected for the Flint HMA during the tho-year forecast period endingJune 1, 197 1, including about 4oo added mobtle tromes. )/ Data {n tltc atrcrIysis.arcr supplt:ment.1ry to a previous analysls thc area rrs of November 1, 196l . 'f 2 The most successful demand-supply relationship in the housing market will be achieved if the new units added (other than mobile homes) consist of 2'ooo single-family homes and lrloo mulEifarnily rental uniEs. The annual demand levels are lower than recent con- struction volumes, but, population and household growth are expecEed at a slower level than that of the L967-1969 period. Table r presents the demand for single-family houses by price ranges and for multifamily uniEs by monthly gross rents. Occupancv Potential for Subsidi-zed Housing Federal assistance in financing costs for new housing for low or moderate income farnilies may be provided through four differeL.t programs administered by FHA --monthly rent-supplement paJments, prin- cipally in rental projects financed wiEh market-interest-rate mort- gages insured under Section ZZf(d) (3) ; partial pa)ments for interest for home mortgages insured primarily under Section 235; partial pay- ment for interest for project mortgages insured under section 236; and below-market-interest-rate financing for project,mortgages insured ur:der Section 221(d) (3). Hoursehold eligibirity for federal subsidy programs is det.ermined primarily by evidence that household or family ir,"o*. is below estab- lished limits- some families may be arternativery eligtble for as- sistance under one or more of t.hese programs or under other ageistance Programs using Federal or State support. since the potential program for each is estim,ated separately, there is no attempE to eliminate Ehe overlaps."To.g program estimates. Accordingly, the occupancy potentials- discussed for various programs are not additive. Furghermo.L, f.rt,rru approvals under each program should take into account any intervening approvals under other programs which serve the same requirements. The potentialsl/ discussed in the following paragraphs reflect estimates adjusted for housing provided or under constiuclion under alternative FHA or other programs. The annual occupancy potentials for subsidized housing FHA pro- grams in discussed below are based upon 1969 incomes, on the occupancy of substandard housingr on estimates of the erderly population, on-Thu ApriI 1' 1969 income limitsr and on available market u"p.iiu""..!i pancy o"",1- potentials by size of units requlred are shown in tabre rr. 'l'ht: !/ occ111)rlrlcy 5x)LentJ aIs rlt.r.rrlc.Cl t<> 1n the analysl s arr' depcnclent uporr tht. capaclty of the mrrrkeL ln vlew of exlsting vac&ncy sLrength or weakness. The successfuL attatnment of the calculaEed market for subsidlzed housing may well depend upon construction in suirabty accessible locations, as well as upon the distribution of rents over the complete range attainable for housing under specific prograos. Zl Families with incomes inadequate to purchase or rent nonsubsidized housing generally are eligible for one form or another of subsidized housing. However, little or no housing has been provided under some of the subsidized programs, and absorption rates remain to be tested 3 Section 22L(d)(3)BMIR If funds are availableY, a total of about 290 units of Section 22L(d) (3)IIMIR housing probably coul d be absorbed annually during Ehe nexL two years. The potential excludes 50 units currently under construction in Flint. Rent -Su IemenE s1 Uncler the rent-supplemenE Prograxu, there is an annual occuPancy potential for 25A units, includlng 175 units for the elderly and 75 units for fasrllies. About 15 percent of the elderly famil-ies eligible for rent-supplement are also eligible under the Sectlon 236 program. SecEion 235, Sales Housing. Interest rate teduction Payments by the federal government could provide sales housing for low- to moderaEe- income families under the provisions of Section 235. It is judged that there is an occupancy potential for about 22O units annually under the Section 235 prograrn in rhe Flint HMA during the next two years using exception income limits. Under regular income limits, the potential r,rculd be slightty lower. All of the families eligible under Section 235 housing also are eligible under the Section 236 program and abouE 75 percent are eligible for Section 221(d) (3)BMIR housing. Section 235, Rental Housing. In the Flint area, the annual occu- pancy potential under the Section 236 program is estimated at 455 units, including 375 family units and 80 units for elderly individuals and couples, using exception income limits. The use of regular income limits may decrease these potenEials. All families elrgible under this progr{rm are also eligible under Section 235, abouL 75 petcent are eligible under Section 221(d)(3)BMIR, and about 4O percent of the elderly eligtble under Section 236 also are eligible for rent-supplements. The Sales MarkeE The market for new and existing sales housing in the Flint area has been stable in recent years, as indicated by the homeowner vacancy rate of 1.1 percent in 1967 and 1969. Construction of new single- family homes has continued at a level of around 2r35O annually since 1966, with an incrtrasing number of homes being built on a contract basis. The fairly tlght sales rnarket has resulLed from several factors, including the removal of many ()lder:, deteriorating units from the markeL by urban renewal and highway construct-ion activitles, and in- creasing household growth. Although single-family construction has occurred throughout the HMA, only certain areas have large subdivisions. An unsold inventory survey of the area reported lrzll completions dur- ing 1968, of which 68 percent $/ere built on a contract basis. The !/ At the present time, funds for allocations are available only from recapcures resuIting from reductions, hrithdrawals, and cancellations of outstanding allocations. 4 remaining homes were successfully markeced, and only 12 (3 percent) were unsold at the time of the survey. Nearly all of these unsold homes had just been completed. Subst.antial activity has continued in the area of Grand Blanc, south of Flint, where several subdivisions with homes priced over $25'OOO have been built, and where homes priced well over $35'OOO have been successfully marketed. In most of the oEher subdivisions de- veloped recently throughout the HMA, however, most homes have been priced between $22r5OO and $3O,OOO. Relatively few homes priced under $2O,OOO have been built, although some lower priced subdivisions have been de- veloped in areas such as Swartz Creek and Mount Morris Township.