2. CCSR-HRSR 09-04-2012 SPEC JOINT

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HOUSING DEMAND ANALYSIS Adjusting for inflation, we have estimated that households with incomes of$35,000 or more and homeowners with incomes of$25,000 to $34,999 would income qualify for market rate independent senior housing in 2015. Considering the growth in the older adult base, the income distribution of the older adult population in 2017, the methodology projected that there will be no demand for adult owner-occupied units and remain at 40 adult rental units in the City of Elk River by 2017. Estimated Demand for Affordable Independent Senior Housing Table HD-4 presents our demand calculations for affordable senior housing for households with incomes qualifying at or below 50% and 80% of AMI in Elk River in 2012 and 2017. In order to arrive at the potential age and income-qualified base for low-income and affordable housing, we include all senior (65+) households that qualify for the income guidelines for one- and two-person households in 2012 at or below 50% and 80% of AMI ($29,400 and $53,700). Adjusting to include appropriate long-term capture rates for each age cohort (1.5%of households age 55 to 64, about 10.0% of households age 65 to 74, and 20.0% of households age 75 and over) results in a market rate demand potential for 12 independent senior rental units in 2012. We then estimate that seniors currently residing outside of Elk River would generate 40% of the demand for affordable senior housing. This demand includes seniors who reside outside of Elk River that would move to the city, as well as those who would relocate from other places of residence (i.e. rural areas, other areas of the state and out-of-state). Together, demand from Elk River seniors and demand from seniors who would locate to Elk River total an estimated 20 affordable units in 2012. There are no affordable senior rental properties in Elk River and thus, the total potential demand remains at 20 units in 2012. No single site can capture all of the excess demand in Elk River. We estimate that a site in Elk River could capture 80% of the Elk River demand, resulting in demand for 16 affordable independent senior units in 2012. Adjusting for inflation, we estimate that households with incomes between $26,000 and $56,500 would qualify for affordable housing in 2017. Although growth in senior households is projected, the age-income qualified base for affordable housing is shown to decline in Elk River through 2017. Following the same methodology, we project that excess demand capturable by a site is calculated to decrease slightly to 12 affordable independent senior housing units by 2017. MAXFIELD RESEARCH INC. 81