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CONCLUSIONS AND RECOMMENDATIONS <br /> introduction <br /> The impetus for this study is to assess the market potential for affordable senior housing units <br /> in Elk River, Minnesota. in particular,this study focuses on the market potential for the 84 units <br /> affordable through the UHTC program to be built at the Blackhawk Woods development. <br /> Earlier sections of this report examined the quality of the Site for residential use,demographic 'F <br /> growth trends and projections,and the historic and current performance of existing affordable <br /> and older market rate rental properties in the PMA. This section of the report assesses demand <br /> for affordable senior rental housing in the PMA and calculates the portion of overall demand <br /> . . ............ . <br /> that could be captured by Blackhawk Woods. <br /> Affordable Senior Rental Demand Analysis <br /> Demand calculations analyze information from the demographic(demand-side)and market <br /> (supply-side)conditions for affordable rental housing. Table 15 on the following page presents <br /> a summary of demand calculations for affordable senior rental housing in the PMA over the <br /> next five years. The following text summarizes the demand methodology used to arrive at <br /> these figures. <br /> in order to determine demand for affordable independent senior housing,the potential market <br /> is reduced to those households that are both age and income qualified. The age-qualified <br /> market is defined as seniors age 55 and older,although independent living projects will <br /> primarily attract seniors age 65 and older. <br /> We calculate the minimum income needed to afford monthly rents based on income guidelines <br /> established by HUD and the Minnesota Housing Finance Agency(MHFA). Based on household <br /> size,the income guidelines for Blackhawk Woods will range from approximately$20,000 to <br /> :39,500. In addition,we add households with incomes between$15,000 and$20,000 who <br /> would be able to supplement their incomes with the proceeds from a home sale. We estimate <br /> the number of age/income-qualified senior households in the Elk River Market Area in 2012 to <br /> be 1,148 households. <br /> Adjusting to include appropriate short-term capture rates for each age cohort(1.5%of <br /> households age 55 to 64,about 10.0%of households age 65 to 74,and 20.0%of households <br /> age 75 and over)results in a market rate demand potential for about 100 affordable <br /> independent senior rental units in 2012. <br /> MAXFIELD RESEARCH INC. 54 <br />