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HOUSING DEMAND ANALYSIS <br /> outside Elk River. This demand will consist primarily of parents of adult children living in Elk <br /> River, individuals who live just outside of Elk River and have an orientation to the area, as well <br /> as former residents who desire to return. Together, the demand from Elk River seniors and <br /> demand from seniors who would relocate to Elk River results in a total long-term demand for <br /> 159 active adult units in 2015. <br /> Independent demand in Elk River is split into housing that offers ownership housing and rental <br /> housing. Based on the current product available in Elk River, we project that 40%of Elk River's <br /> demand will be for adult ownership housing (63 units) and 60%will be for rental housing (95 <br /> units). <br /> TABLE HD-3 <br /> MARKET RATE ADULT/FEW SERVICES HOUSING DEMAND <br /> ELK RIVER <br /> 2015&2020 <br /> 2015 2020 <br /> Age of Householder Age of Householder <br /> 55-64 65-74 75+ 55-64 65-74 75+ <br /> #of Households w/Incomes of>$35,0001 1,213 732 430 1,412 928 789 <br /> #of Households w/Incomes of$24,999 to$34,9991 + 73 77 88 + 72 79 113 <br /> (times)Homeownership Rate x 87% 84% 63% x 87% 84% 63% <br /> (equals)Total Potential Market Base = 1,277 796 485 = 1,475 994 860 <br /> (times)Potential Capture Rate x 0.5% 5.0% 15.0% x 0.5% 5.0% 15.0% <br /> (equals)Demand Potential = 6 40 73 = 7 50 129 <br /> Potential Demand from Market Area Residents = 119 = 186 <br /> (plus Demand from Outside Market Area(25%)2 + 40 + 62 <br /> (equals)Total Demand Potential = 159 = 248 <br /> Owner- Renter- Owner- Renter- <br /> Occupied Occupied Occupied Occupied <br /> (times)%by Product Type x 40% x 60% x 40% x 60% <br /> (equals)Demand Potential by Product Type = 63 = 95 = 99 = 149 <br /> (minus)Existing and Pending MR Active Adult Units3 - 111 - 72 - 111 - 72 <br /> (equals)Excess Demand for MR Active Adult Units = 0 = 23 = 0 = 77 <br /> 1 2020 calculations define income-qualified households as all households with incomes greater than$40,000 and homeowner households with incomes <br /> between$30,000 and$39,999. <br /> 2 Based on project manager interviews and historical trends. We estimate that roughly 40%of demand will come from outside the markt area. <br /> 3 Existing and pending are deducted at market equilibrium(95%occupancy). <br /> Source: Maxfield Research&Consulting,LLC <br /> Next, we subtract existing competitive market rate units (minus a vacancy factor of 5%to allow <br /> for sufficient consumer choice and turnover) from the owner and rental demand. Subtracting <br /> the existing competitive market rate units results in total demand potential for zero adult <br /> owner-occupied units and 23 adult rental units in 2015. <br /> MAXFIELD RESEARCH&CONSULTING,LLC 87 <br />