Upper Valley Housing Needs Analysis Briefing Materials

1. Upper Valley Housing Needs AnalysisBriefing Materials Prepared for Upper Valley Lake Sunapee Region Planning March 2002 (revised July 2002) Study Under Contract To Upper Valley Lake Sunapee Regional Planning Commission Applied Economic Research Laconia New Hampshire Assisted By Economic and Policy Resources, Inc

2. Study Area

3. Funding Sources • Dartmouth College • Dartmouth-Hitchcock Medical Center • Fleet Bank • Housing Vermont • Mascoma Saving Bank • NH Community Development Finance Authority • NH Housing Finance Authority • Rockingham Area Community Land Trust • Southern Windsor County regional Planning Commission • Springfield Housing Authority • Two Rivers-Ottauquechee Regional Commission • Upper Valley Community Foundation • Upper Valley Lake Sunapee Regional Planning Commission • VT ACCD Department of Housing & Community Affairs • VT Agency of Human Services • VT Housing & Conservation Board • VT Housing Finance Authority • VT State Housing Authority

4. Steering Committee Participants • Upper Valley Lake Sunapee Regional Planning Commission: Tara Bamford, Interim Executive Director, and Peter Dzewaltowski, Regional Planner • Southern Windsor County Regional Planning Commission: Becky Basch, Senior Planner • Two Rivers-Ottauquechee Regional Commission: Kathleen Kanz, Regional Planner • Twin Pines Housing Trust: Gretchen Rittenhouse, Executive Director • Green Mountain Economic Development Corporation: Jim Saudade, Executive Director • Vermont Housing & Conservation Board: David Weinstein, Federal Housing Programs Director • Vermont Agency of Commerce & Community Development, Department of Housing & Community Affairs, : Steve Coble, Housing Program Coordinator • Vermont Housing Finance Authority, : Leslie Black-Plumeau, (former) Research Analyst, and John Fairbanks, Public Affairs Manager • New Hampshire Housing Finance Authority : Ted Wilkinson, Development Officer

5. Study Goals • Examine relationship between area’s economy and housing markets • Dimension current housing affordability and choice issues in relationship to area wages and income • Project future housing production requirements: • Provide sufficient choice • Bring prices in line with wages/income • Accommodate sufficient labor force to meet employers’ needs

6. The Big Picture: Lebanon-Hartford Region • Strong job growth and a tight labor market • Sub-par housing production during past decade • Vacancies all absorbed, limited choice, price/rent appreciation exceeds wage/income growth creating affordability crunch for broad spectrum of region’s workers • Strong job growth likely to continue • Will require sharply higher rates of production to achieve goals of adequate choice and balance between wages and housing costs. • Alternatively, slower nonresidential tax base growth and continued housing issues.

7. The Big Picture: Springfield Region • Slow job growth and higher unemployment characterize the economy. • Region has traded higher paying manufacturing jobs for lower paying retail and service jobs. • Housing quality has suffered in wake of economic underperformance. • Although housing is less expensive, jobs also pay less and there are affordability issues for lower wage workers. • Housing production is less critical than housing rehabilitation.

8. Job Growth Totals 9,300 a 15% Increase Source: ES202 state data Employment by lma aer data

9. Job Growth Concentrated in Lebanon-Hartford LMA Source: ES202 state data Employment by lma aer data

10. There Is No Unemployment Outside of Springfield

11. Wages are Moderate, Outside of Lebanon Area

12. Population Tops 150,000

13. Population Growth Concentrates in Lebanon/Hartford LMA

14. 75,000 Housing Units in Region

15. Units Are Dispersed

16. Demand Has Outstripped Supply

17. Vacancy Rates Plummet—(Effective Vacancy Even Lower)

18. Very Low Rental Inventory Growth

19. Acute Rental Shortage in Lebanon Area

20. Non Traditional Households Dominate Emerging Market

21. Median Home Price By Market Area

22. Housing Demand Grows, Hanover-Lebanon

23. Available Units Plummet

24. Effective Inventory Plummets MLS AREA RED IN 1996

25. Prices Rise

26. Affordability Suffers

27. Housing Costs Outstrip Income Gains

28. Rents Also Increase

29. Imbalance: Ownership Costs and Wages/Income

30. Imbalance: Rental Costs and Wages/Income

31. Growth Factors • Excellent lifestyle • Internationally prominent health and education facilities • Safe, rural environment • Exceptionally skilled labor force • Relatively recession proof • Diverse economic base • College and hospitals are healthy • Large retail trade area • Expanding technology base • DHMC in expansion mode

32. Growth Will Mirror Recent Pace (BEA Definition)

33. Young Households=Major Growth Shift

34. Housing Needs • Enough units to accommodate growth • Enough units to provide adequate choice • Enough units to normalize unemployment rate • Enough units to replace units lost

35. Production Requirements Double to Support Similar Job Growth

36. Pressures Greatest in Lebanon/Hartford

37. Rental Requirements Rise Sharply

38. One Third of Need Is Not Because of Growth

39. In The Alternative • If housing production remains at 1990-2000 rates: • 8,500 fewer jobs will be supported (50% less) • Slower growth in non residential tax base • Current housing choice and affordability pressures will remain • Tight labor market will pressure employers • Need is for BALANCE: • Job growth:housing production • Wage levels:housing costs

40. Lower Income Renter Demand Will Be Strong

41. Market Can Address Much, But Not All of Ownership Demand