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HOUSING DEMAND ANALYSIS <br />months according to the 2009 Overview of Assisted Living). For each age group in Table HD -7, <br />we estimate the income - qualified percentage to be all seniors in households with incomes <br />above $40,000 (who could afford monthly rents of $3,000+ per month) plus 40% of the <br />estimated seniors in homeowner households with incomes below $40,000 (who will spend <br />down assets, including home - equity, in order to live in assisted living housing). This results in a <br />total potential market of 211 units from the PMA in 2010. <br />Age gro <br />75-79 <br />80-84 <br />85+ <br />Total <br />Percent Income- Qualified 2 <br />TABLE HD -7 <br />MARKET RATE ASSISTED LIVING DEMAND <br />ELK RIVER <br />2015 & 2020 <br />1,024 <br />Total potential market <br />(times) Percent living alone <br />(equals) Age /income - qualified singles needing assistance <br />(plus) Proportion of demand from couples (12 %)3 <br />(equals) Total age /income - qualified market needing assistance <br />(times) Potential penetration rate <br />(equals) Potential demand from PMA residents <br />(plus) Proportion from outside the PMA (40 %) <br />(equals) Total potential assisted living demand <br />(minus) Existing market rate assisted living unitss <br />(equals) Total excess market rate assisted living demand <br />370 <br />57% <br />211 <br />x 51% <br />= 108 <br />+ 15 <br />= 122 <br />x 40% <br />= 49 <br />+ 33 <br />= 82 <br />47 <br />W <br />Percent Number <br />Needing Needing <br />Assistance' Assistance' <br />520 25.5% <br />Percent <br />Number <br />114 <br />Needing <br />Needing <br />People <br />Assistance' <br />Assistance' <br />394 <br />25.5% <br />100 <br />307 <br />33.6% <br />103 <br />323 <br />51.6% <br />167 <br />1,024 <br />Total potential market <br />(times) Percent living alone <br />(equals) Age /income - qualified singles needing assistance <br />(plus) Proportion of demand from couples (12 %)3 <br />(equals) Total age /income - qualified market needing assistance <br />(times) Potential penetration rate <br />(equals) Potential demand from PMA residents <br />(plus) Proportion from outside the PMA (40 %) <br />(equals) Total potential assisted living demand <br />(minus) Existing market rate assisted living unitss <br />(equals) Total excess market rate assisted living demand <br />370 <br />57% <br />211 <br />x 51% <br />= 108 <br />+ 15 <br />= 122 <br />x 40% <br />= 49 <br />+ 33 <br />= 82 <br />47 <br />W <br />Percent Number <br />Needing Needing <br />Assistance' Assistance' <br />520 25.5% <br />133 <br />338 33.6% <br />114 <br />363 51.6% <br />187 <br />1,221 <br />433 <br />56% <br />243 <br />51% <br />124 <br />17 <br />141 <br />40% <br />56 <br />38 <br />94 <br />47 <br />47 <br />' The percentage of seniors unable to perform or having difficulting with ADLs, based on the 2008 Survey of Income and Program <br />Participation (SIPP) files, conducted by the U.S. Census Bureau. <br />z Includes households with incomes of $40,000 or more (who could afford monthly rents of $3,000+ per month) plus 40% of the <br />estimated owner households with incomes below $40,000 (who will spend down assets, including home - equity, in order to live in <br />assisted living housing). <br />3 The 2009 Overview of Assisted Living (a collaborative project of AAHSA, ASHA, ALFA, NCAL & NIC) found that 12% of assisted living <br />residents are couples. <br />° We estimate that 60% of the qualified market needing assistance with ADLs could either remain in their homes or reside at less <br />advanced senior housing with the assistance of a family member or home health care, or would need greater care provided in a <br />skilled care facility. <br />s Existing and pending units at 93% occupancy. We exclde 15% of units to be Home and Community Based Waiver recipients. <br />Source: Maxfield Research & Consulting, LLC <br />Because the vast majority of assisted living residents are single (88% according to the 2009 <br />Overview of Assisted Living), our demand methodology multiplies the total potential market by <br />the percentage of seniors age 75+ in the PMA living alone. Based on 2010 Census data, 51% of <br />age 75+ households in the PMA lived alone. Applying this percentage results in a total base of <br />211 age /income - qualified singles. The 2009 Overview of Assisted Living found that 12% of <br />MAXFIELD RESEARCH & CONSULTING, LLC 93 <br />