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HOUSING DEMAND ANALYSIS <br />TABLE HD -6 <br />MARKET RATE CONGREGATE HOUSING DEMAND <br />ELK RIVER <br />2015 & 2020 <br />of Households w/ Incomes of >$35,000' <br /># of Households w/ Incomes of $25,000 to $34,999' <br />(times) Homeownership Rate <br />(equals) Potential Market <br />(equals) Total Potential Market Base <br />(times) Potential Capture Rate <br />(equals) Demand Potential <br />Potential Demand from Market Area Residents <br />(plus) Demand from Outside Market Area (25 %) <br />(equals) Total Demand Potential <br />(minus) Existing and Pending Congregate Units3 <br />(equals) Excess Demand for Congregate Units <br />Age of <br />Age of <br />Householder <br />Householder <br />65 -74 75+ <br />65 -74 75+ <br />732 430 <br />928 489 <br />+ 77 88 <br />+ 79 113 <br />x 84% 63% <br />x 84% 63% <br />= 65 55 <br />= 66 71 <br />= 797 485 <br />= 994 560 <br />x 1.5% 11.0% <br />x 1.5% 11.0% <br />= 12 + 53 <br />= 15 + 62 <br />= 77 <br />= 65 <br />+ 22 <br />+ 26 <br />= 87 <br />= 102 <br />= 87 I I = 102 <br />' 2020 calculations define income - qualified households as all households with incomes greater than $40,000 and homeowner <br />households with incomes between $30,000 and $49,999. <br />2 The potential capture rate is derived from data from the Summary Health Statistics for the U.S. Population: National Health <br />Interview Survey, 2007 by the U.S. Department of Health and Human Services. The capture rate used is the percentage of seniors <br />needing assistance with IADLs, but not ADLs (seniors needing assistance with ADLs typcially need assistance with multiple IADLs and <br />are primary candidates for assisted living.). <br />' Existing and pending are deducted at market equilibrium (95% <br />)ccupancy). <br />Source: Maxfield Research & Consulting, LLC <br />We estimate that seniors currently residing outside of Elk River will generate 25% of the <br />demand for congregate senior housing. This demand will consist primarily of parents of adult <br />children living in Elk River, individuals who live just outside Elk River and have an orientation to <br />the area, and former residents who desire to return upon retirement. Together, the demand <br />from Elk River seniors and demand from seniors who are willing to locate to Elk River totals 87 <br />units of congregate senior housing in 2015. <br />Since there are no existing congregate units in Elk River, we do not reduce the demand <br />potential by any competitive units. As a result, demand is calculated for 87 congregate units in <br />Elk River in 2015. <br />Adjusting for inflation, we estimate that households with incomes of $35,000 or more and <br />senior homeowners with incomes between $25,000 and $35,000 would qualify for congregate <br />housing in 2017. Following the same methodology, demand is calculated to increase to 102 <br />units through 2020. <br />MAXFIELD RESEARCH & CONSULTING, LLC 91 <br />