Drivers of Housing Demand

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Drivers of Housing Demand Preparing for the
Impending Elder Boom
www.gnocdc.org
A product of Nonprofit Knowledge Works
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Part Ia. Economic and Housing Trends
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The New Orleans metro has weathered the recession
relatively well, buffered by the stimulus of
Katrina rebuilding investments.
Percent change in nonfarm jobs Aug. 2008 Aug.
2011

• Source GNOCDC analysis of data from U.S. Bureau
  of Labor Statistics.

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Fewer jobs mean fewer people and more vacant
housing.
Population, jobs, and housing units New Orleans
metro

• Sources GNOCDC analysis of data from U.S. Census
  Bureau, U.S. Bureau of Labor Statistics, and
  Moodys Analytics (U.S. Bureau of Labor
  Statistics CES, QCEW).

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The New Orleans regional economy is still largely
reliant on legacy industries.
Regional export jobs for the 10 largest
export specializations New Orleans 10-parish
region

• Source GNOCDC analysis of data from Moody's
  Analytics (U.S. Bureau of Labor Statistics CES,
  QCEW).

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New Orleanians are feeling the impact of the
Great Recession.
Poverty rate for the population for whom poverty
status is determined

• Sources GNOCDC analysis of U.S. Census Bureau
  data from Census 2000 and American Community
  Survey single-year estimates for 2007 and 2010.
  Note Reference dates for ACS estimates are the
  previous 12-month period, collected over a
  two-year period. n.s. indicates change between
  1999 and 2010 is not significant at 95
  confidence interval.

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Home sales are slow in the city, but stable.
Average monthly home sales, Jan. Sep. New
Orleans

• Source GNOCDC analysis of data from the New
  Orleans Metropolitan Association of Realtors.
• Note Data captured monthly and numbers finalized
  a year later.

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New Orleans homeowners, even those without
mortgages, have sharply higher housing costs
since 2004.
Median monthly housing costs for homeowners in
2010 inflation-adjusted dollars, Orleans Parish

• Housing costs for homeowners include
• Mortgage
• Taxes
• Insurance
• Utilities

• Sources GNOCDC analysis of U.S. Census Bureau
  data from American Community Survey 2004 and
  2010.
• Note Data are in 2010 inflation-adjusted dollars
  using the CPI-U-RS.

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35 percent of New Orleans homeowners are
cost-burdened.
Homeowners paying unaffordable housing costs 30
or more of pre-tax income on housing, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from American Community Survey 2010.
• n.s.indicates difference from Orleans is not
  significant at 95 confidence interval.

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Renter costs spiked 37 percent since 2004.
Monthly housing costs for renters in 2010
inflation-adjusted dollars, Orleans Parish

• Housing costs for renters include
• Rent
• Utilities

• Sources GNOCDC analysis of U.S. Census Bureau
  data from American Community Survey 2004 and
  2010.
• Note Data are in 2010 inflation-adjusted dollars
  using the CPI-U-RS.

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Renter costs in New Orleans are well above
similar cities.
Rent comparison across cities median gross
monthly housing costs for rentals of any size,
2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from the American Community Survey 2010.
• n.s.indicates difference from Orleans is not
  significant at 95 confidence interval.

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New Orleans renters pay 5 percent more than the
U.S. average for housing from incomes that are 20
percent lower.
Annual housing costs vs. income for renters, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from the American Community Survey 2010.

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Due to a prevalence of low-wage jobs, Orleans
rentersare more likely to pay at least half
their income on housing than New York renters.
Percent of renters paying unaffordable housing
costs 50 or more of income on housing, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from the American Community Survey 2010.
• n.s.indicates difference from Orleans is not
  significant at 95 confidence interval.

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Part Ib. Demographic Trends
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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The baby boomers are like a demographic tsunami.
New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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As the baby boomers age, the age structure of the
metro area has shifted.
Trends and projections in the share of population
by age group New Orleans metro
Sources GNOCDC analysis of U.S. Census Bureau
data from the decennial census, and authors
projections.
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As the baby boomers grew up and birth rates fell,
the mix of household types dramatically changed
in the city
Share of total households by type New Orleans

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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as well as in the suburbs.
Share of total households by type Rest of the New
Orleans metro

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Households with children are more likely to live
in the suburbs, while singles lt65 are more likely
to live in New Orleans, and individuals 65 are
equally likely to live in the city or suburbs.
Share of metro households living in the city by
type of household, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Another significant demographic shift is the
influx of Latinos to the New Orleans metro, the
majority of whom settled outside the city in
suburban parishes.
Hispanic population growth New Orleans and the
rest of the New Orleans metro

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Were it not for the large influx of Latinos and
Asians, the age structure of the New Orleans
metro would be even older. The future of the New
Orleans area will be decidedly more diverse.
Elderly, working-age adults, and children in the
New Orleans metro by race and ethnicity, 2010
65 years
20-64 years
Under 20 years

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Part II. Impending Housing Demand
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New Orleans metro population
142,000 residents 65 years
Source GNOCDC analysis of U.S. Census Bureau
data from the decennial census.
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New Orleans metro population
191,000 residents 65 years
Source Authors projections.
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New Orleans metro population
233,000 residents 65 years
Source Authors projections.
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There will be a sizable jump in the metro
population 65 years and older by 2020.
Trends and projections in the population 65 years
and older New Orleans metro

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census, and authors
  projections.

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This is important because as adults reach
retirement age and older, they may find
themselves considering a move.
Living in a different house one year ago Share
of total population by age, 2010

• Source GNOCDC analysis of data from the American
  Community Survey 2010.

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By 2020, the elder boom will dramatically change
New Orleans household mix.
Projected change in number of households by type
for three scenarios New Orleans

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census, and authors
  projections.
• Note For a downloadable spreadsheet of household
  and population projections for Scenario 1, and
  Technical Appendices with information about our
  methodology, be sure to visit www.gnocdc.org.

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In New Orleans, a large and growing number of
adults 65 and older (living at home) have a
moderate or serious disability.
Adults 65 and older who are moderately or
seriously disabled and living at home New Orleans

• Sources Urban Institute analysis of U.S. Census
  Bureau data from the Decennial Census 2010,
  American Community Survey 2010, and authors
  projections.
• Note See the Technical Appendices for more
  details on our methodology.

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By 2030, a larger number of older adults in New
Orleans will reach 75 years and older, at which
point a larger number of elderly will likely have
disabilities.
Projections in the population 65 years and older
New Orleans

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census, and authors
  projections.

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New Orleans elders are much more likely to be
impoverished than elders in surrounding suburbs
and across the nation.
Poverty and twice poverty rates in the population
65 years and older, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from American Community Survey 2010.
• n.s.indicates difference from Orleans is not
  significant at 95 confidence interval.

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Many baby boomers grew up in the suburbs.
Density of occupied housing units New Orleans
metro

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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By 2010, 69 percent of all households in the
metro lived in suburban parishes, and only 31
percent lived in the city.
Occupied housing units by parish New Orleans metro

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Many baby boomers grew up in the suburbs and will
likely remain there, if possible. But
decisionmakers can strive to retain current
residents in the city as they age.
Share of metro population living in the city by
age group, 2010

• Source GNOCDC analysis of U.S. Census Bureau
  data from the decennial census.

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Older New Orleanians are more likely be
homeowners and live in single family homes built
before 1950. Helping older people stay in their
homes is a great preventer of future blight.
Select household characteristics New Orleans,
2009

• Source GNOCDC/ Urban Institute analysis of
  American Community Survey Public Use Microdata
  Series, 2009.
• Note These percentages are derived from authors
  analysis of American Community Survey 2009
  microdata in order to capture housing
  characteristics not included in the Census 2010.
  As a result, the homeownership rate published
  above for all households varies slightly from the
  Census 2010.

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Part III. What demographic shifts suggest for
policy and programs
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Attracting New Residents

• Create central portal to market neighborhoods and
  ease moves into the city.
• Live Baltimore
• Milwaukee city and nonprofits
• Think about the changing size and demographics of
  households when making development decisions.

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Building Supports for Aging in PlaceAccessibility

• Repair assistance for low-income, older
  homeowners.
• Enforce Fair Housing accessibility requirements
  for rentals.
• Promote universal design.

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Building Supports for Aging in PlaceSupport
Services

• Assess health of in-home service sector.
• Map out availability and gaps in community
  supports (types of services provided,
  transportation access, cost, etc.).

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Building Supports for Aging in PlaceAffordability

• Promote availability of programs to reduce
  housing costs.
• City program to freeze assessed value
• NOLA Wise for energy-efficiency
• Learn how state rules on Medicaid promote or
  hinder aging in place.

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Understanding the Array of Specialized Senior
Housing
New Orleans metro
Housing Type Units/beds Percent
Independent/Assisted Living 1,000 13
Nursing Homes 5,000 63
Continuing Care Retirement Comm. 2,000 25
Total 8,000 100

• Sources GNOCDC/ Urban Institute analysis of
  InfoUSA and Nursing Home Compare databases.

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Projecting the Future Demand for Specialized
Senior Housing

• Assuming current ratios, need 1,400 more
  specialized units or beds in the city by 2020.
• Mix of types could shift due to preferences or
  policies.
• Specialized housing is costly.
• Median monthly rent 3,620 for assisted living
• Median monthly rent 4,471 for semi-private
  nursing home unit
• CCRC down payment 100,000 and up

• Sources GNOCDC/ Urban Institute analysis of
  InfoUSA and Nursing Home Compare and authors
  projections Genworth Financial Inc., 2011

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Senior Housing in New Orleans

• Senior housing data should be verified and
  tracked.
• Senior housing options could draw people to the
  city.
• Review zoning, regulations for siting.
• Re-purpose empty public buildings for senior
  housing.

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Preserving the Role of Subsidized Housing for
the Elderly

• Understand demand/supply of accessible housing
  and support services for public and assisted
  housing residents.
• HANO should assess whether goal of accessibility
  for 10 percent of new units is sufficient to meet
  upcoming needs.
• Louisiana Housing Corporation can establish
  set-asides for housing with services and
  prioritize rehab and reuse to reduce blight.

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To read the entire Drivers of Housing Demand
Preparing for the Impending Elder Boom go to
www.gnocdc.org