comprehensive housing market analysis for plainview, minnesota · maxfield research inc. the study...

Comprehensive Housing Market Analysis for Plainview, Minnesota

Prepared for:

Plainview Economic Development Authority Plainview, Minnesota February 2015

1221 Nicollet Mall Suite 218 Minneapolis, MN 55403 612.338.0012

February 11, 2015 Ms. Judith Jordan Economic Development Director Plainview Economic Development Authority 241 West Broadway Plainview, MN 55964 Dear Ms. Jordan: Attached is the Comprehensive Housing Market Analysis for Plainview, Minnesota conducted by Maxfield Research Inc. The study projects housing demand from 2014 through 2025, and gives recommendations on the amount and type of housing that could be built in Plainview to satisfy demand from current and future residents over the next decade. The study identifies a potential demand for approximately 361 new housing units through 2025. About 72% of the total demand was for general-occupancy housing; while age-restricted senior housing accounted for 28% of the demand. Demand was highest for for-sale single-family housing; showing a need for about 125 units after the existing lot supply has been diminished. Due to the lack of rental supply in Plainview, there is demand for nearly 50 market rate rental units. Detailed information regarding recommended housing concepts can be found in the Conclusions and Recommendations section at the end of the report. We have enjoyed performing this study for you and are available should you have any ques-tions or need additional information. Sincerely, MAXFIELD RESEARCH INC. Matt Mullins David Sajevic Vice President Analyst

Attachment

TABLE OF CONTENTS Page EXECUTIVE SUMMARY ........................................................................................................ 1 DEMOGRAPHIC ANALYSIS ................................................................................................... 7 Introduction .................................................................................................................... 7 Market Area Definition ................................................................................................... 7 Population and Household Growth from 2000 to 2010 ................................................. 9 Population and Household Estimates and Projections ................................................... 11 Age Distribution Trends .................................................................................................. 14 Household Income by Age of Householder .................................................................... 16 Net Worth ....................................................................................................................... 21 Tenure by Household Income ......................................................................................... 23 Tenure by Age of Householder ....................................................................................... 25 Tenure by Household Size ............................................................................................... 27 Ethnicity and Diversity .................................................................................................... 28 Mobility ........................................................................................................................... 30 Demographic Comparison to Peer Cities ........................................................................ 32 EMPLOYMENTRENDS .......................................................................................................... 34 Introduction .................................................................................................................... 34 Employment Growth & Projections ................................................................................ 34 Resident Labor Force....................................................................................................... 35 Commuting Patterns ....................................................................................................... 39 Inflow/Outflow ................................................................................................................ 40 Existing Business Mix ...................................................................................................... 43 Major Employers ............................................................................................................. 44 Employer Survey ............................................................................................................. 45 HOUSING CHARACTERISTICS ............................................................................................... 46 Introduction .................................................................................................................... 46 Residential Construction Trends ..................................................................................... 46 American Community Survey .......................................................................................... 49 Age of Housing Stock....................................................................................................... 49 Housing Units by Structure and Occupancy or (Housing Stock by Structure Type) ....... 51 Owner Occupied Housing Units by Mortgage Status ..................................................... 52 Owner-Occupied Housing Units by Value ....................................................................... 53 Renter-Occupied Units by Contract Rent ........................................................................ 55 RENTAL MARKET ANALYSIS ................................................................................................ 56 Introduction .................................................................................................................... 56 Overview of Rental Market Conditions ........................................................................... 56 General Occupancy Rental Projects ................................................................................ 59

SENIOR MARKET ANALYSIS ................................................................................................. 64 Senior Housing Defined ................................................................................................... 64 Senior Housing in Plainview and the Market Area .......................................................... 65 FOR-SALE HOUSING ANALYSIS ........................................................................................... 70 Introduction .................................................................................................................... 70 Overview of For-Sale Housing Market Conditions .......................................................... 70 Current Supply of Homes on the Market ........................................................................ 74 Owner-Occupied Turnover ............................................................................................. 78 Lender Mediated Properties ........................................................................................... 78 Homestead Exclusion ....................................................................................................... 81 Actively Marketing Subdivision ........................................................................................ 85 Manufactured Homes ...................................................................................................... 87 Pending For-Sale Developments ...................................................................................... 87 Renter/Builder Interviews................................................................................................ 88 HOUSING AFFORDABILITY................................................................................................... 91 Introduction ..................................................................................................................... 91 Housing Cost Burden........................................................................................................ 95 Housing Vouchers ............................................................................................................ 98 Housing Costs as a Percentage of Household Income ..................................................... 98 HOUSING DEMAND ANALYSIS ............................................................................................ 101 Introduction ..................................................................................................................... 101 Demographic Profile and Housing Demand .................................................................... 101 Housing Demand Overview ............................................................................................. 102 Estimated Demand for For-Sale Housing ......................................................................... 106 Estimated Demand for General Occupancy Rental Housing ........................................... 108 Estimated Demand for Independent Adult Few Services Senior Housing ...................... 110 Estimated Demand for Affordable/Subsidized Independent Senior Housing ................. 112 Estimated Demand for Congregate Senior Housing ........................................................ 114 Demand Estimate for Assisted Living Housing ................................................................ 115 Estimated Demand for Memory Care Housing ................................................................ 119 RECOMMENDATIONS AND CONCLUSIONS ........................................................................ 121 Introduction/Overall Housing Recommendations .......................................................... 121 Recommended Housing Product Types .......................................................................... 124 General Occupancy Rental Housing ................................................................................ 130 Senior Housing ................................................................................................................ 134 Challenges and Opportunities ......................................................................................... 133 APPENDIX ............................................................................................................................ 141 Definitions ....................................................................................................................... 142

LIST OF TABLES Table Number and Title Page D1. Historic Population Growth Trends, Plainview Market Area, 2000 to 2010 ................ 9 D2. Historic Household Growth Trends, Plainview Market Area, 2000 to 2010 ................ 10 D3. Population & Households, Plainview Market Area, 2000 to 2020 ............................... 13 D4. Population Age Distribution, Plainview Market Area, 2000 to 2020 ........................... 15 D5. Household Income by Age of Householder, City of Plainview, 2014 & 2020 ............... 18 D6. Household Income by Age of Householder, Plainview City, 2014 & 2020 ................... 19 D7. Net Worth by Age of Householder, Plainview Market Area, 2014 ............................... 22 D8. Tenure by Household Income, Plainview Market Area, 2012 ...................................... 24 D9. Tenure by Age of Householder, Plainview Market Area, 2000 & 2014 ........................ 26 D10. Tenure by Household Size, Plainview Market Area, 2000 & 2010 ............................... 28 D11. Ethnicity and Diversity, Plainview Market Area, 2000 & 2010 ..................................... 29 D12. Mobility in Past Year by Location and Current Residence, Plainview Market Area, 2012 31 D13. Mobility in Past Year by Age for Current Residence, Plainview Market Area, 2012 .... 31 D14. Demographic Summary, Comparable Cities Throughout Minnesota .......................... 33 E1. Employment Projections, Southeast Minnesota, 2010 - 2020 ..................................... 34 E2. Annual Average Resident Employment, Wabasha County, Rochester MSA & MN,

2000 to 2013 ................................................................................................................. 36 E3. Covered Employment Trends, Wabasha County, 2000, 2005, 2010 - 2013 ................. 38 E4. Commuting Patterns, City of Plainview, 2011 .............................................................. 39 E5. Commuting Patterns, Wabasha County, 2011 ............................................................. 40 E6. Commuting Inflow/Outflow, City of Plainview and Wabasha County, 2011 ............... 41 E7. Business Mix, City of Plainview & Wabasha County, 2013 ........................................... 43 E6. Major Employers, City of Plainview, 2014 .................................................................... 44 HC1. Residential Construction/Annual Building Permits Issued, City of Plainview,

2000 to 2013 ................................................................................................................. 47 HC2. Residential Construction/Annual Building Permits Issued, Wabasha County,

2000 to 2013 ................................................................................................................. 48 HC3. Age of Housing Stock, Plainview Market Area, 2012 .................................................... 50 HC4. Housing Units by Structure and Tenure, Plainview Market Area, 2012 ....................... 51 HC5. Owner-Occupied Housing Units by Mortgage Status, Plainview Market Area, 2012 .. 53 HC6. Owner-Occupied Units by Value, Plainview Market Area, 2012 .................................. 54 HC7. Renter-Occupied Units by Contract Rent, Plainview Market Area, 2012 ..................... 55 R1. Bedrooms by Gross Rent, Renter-Occupied Units, Plainview Market Area, 2012 .......... 57 R2. General Occupancy Rental Developments, Plainview Market Area, February 2015 ...... 60 R3. Affordable/Subsidized Developments, Plainview Market Area, February 2015 ............. 61

S1. Affordable/Subsidized Senior Housing Developments, Plainview Market Area, February 2015 ............................................................................................................... 66

S2. Senior Housing Developments, Plainview Market Area, February 2015 ..................... 67 FS1. Housing Resales, City of Plainview, 2000 tp 2014 ........................................................ 72 FS2. Home Resale Comparisons, Wabasha and Olmsted Counties, 2005 to 2014 .............. 73 FS3. Homes Currently Listed For-Sale, City of Plainview, October 2014.............................. 75 FS4. Active Listing by Housing Type, City of Plainview, October 2014 ................................. 76 FS5. Owner-Occupied Turnover, City of Plainview .............................................................. 78 FS6. Sheriff’s Sale Foreclosures in Minnesota, 2005 - 2013 ................................................. 80 FS7. Plainview Residential Parcels with Buildings, Homestead vs Non-Homestead, 2014.. 82 FS8. Actively Marketing Single Family & Multifamily Subdivisions, City of Plainview, 2014 86 FS9. Mobile Home Parks, Plainview, 2014 ........................................................................... 87 HA1. MHFA/HUD Income and Rent Limits, Wabasha County, 2014 ..................................... 93 HA2. Maximum Rent Based on Household Size and Median Income, Wabasha Co., 2014 .. 94 HA3. Housing cost Burden, Plainview and Wabasha County, 2013 ...................................... 96 HA4. Plainview Market Area Housing Affordability Based on HH Income ............................ 100 HD1. For-Sale Housing Demand, Plainview Market Area, 2014 to 2025 .............................. 107 HD2. Rental Housing Demand, Plainview Market Area, 2014 to 2025 ................................. 109 HD3. Market Rate Active Adult Housing Demand, Plainview Market Area, 2014 & 2020 .... 111 HD4. Affordable/Subsidized Independent Housing Demand, Plainview Market Area,

2014 & 2020 .................................................................................................................. 113 HD5. Market Rate Congregate Housing Demand, Plainview Market Area, 2014 & 2020..... 115 HD6. Market Rate Assisted Living Demand, Plainview Market Area, 2014 & 2020 .............. 117 HD7. Market Rate Memory Care Demand, Plainview Market Area, 2014 & 2020 ............... 120 CR1. Summary of Housing Demand Plainview Market Area, February 2015 ....................... 121 CR2. Recommended Housing Development, City of Plainview, 2015 to 2025 ..................... 123

EXECUTIVE SUMMARY

MAXFIELD RESEARCH INC. 1

Purpose and Scope of Study Maxfield Research Inc. was engaged by the Plainview Economic Development Authority con-duct a Comprehensive Housing Needs Analysis for the City of Plainview. The Housing Needs Analysis provides recommendations on the amount and types of housing that should be devel-oped in order to meet the needs of current and future households who choose to reside in the City. The scope of this study includes: an analysis of the demographic and economic characteristics of the City; a review of the characteristics of the existing housing stock and building permit trends; an analysis of the market condition for a variety of rental and for-sale housing products; and an assessment of the need for housing by product type in the City. Recommendations on the number and types of housing products that should be considered in the City are also sup-plied. Demographic Analysis • The population in the City of Plainview grew by 150 people (+4.7%) between 2000 and 2010

to total 3,340 people in 2010.

• Growth slowed during the late 2000s due to the housing downturn during which several Market Area communities experienced population declines. Overall, however, the Market Area added +276 people between 2000 and 2010, increasing the Market Area population to 7,780 people as of 2010. This was a rate change of +3.7%.

• Over the current decade, we project that the City of Plainview will maintain similar rates of

household growth as the prior decade. Between 2010 and 2020, we estimate that 132 households (+10.3%) will be added in the City, stable from growth of 121 households (+10.5%) between 2000 and 2010.

• Mirroring trends observed across the Nation, the aging baby boomer generation is substan-tially impacting the composition of the Market Area’s population. Born between 1946 and 1964, these individuals comprised the 45 to 54 and 55 to 64 year old cohorts in 2010. As of 2010, baby boomers accounted for roughly 26% of the Market Area’s population.

• Plainview had an estimated median household income of $52,797 in 2014. It is projected to

increase to $58,448 (+10.9%) by 2020.

• In 2000, 81% of all households in the Market Area owned their housing. By 2010, that per-centage increased to 82.2%.

• Resident employment in Wabasha County decreased by -667 people between 2000 and

2013 (-5.6%). The unemployment rate increased from 2.9% (2000) to 4.6% (2013).

EXECUTIVE SUMMARY


• Approximately 30% of Plainview residents also work in Plainview, which is second in per-centage to those who commute to work in Rochester (36.8%). Other areas to which Plainview residents commute includes Winona (2.6%) and Wabasha (2.0%) as well as other cities at small percentages.

• Plainview is considered to be an exporter of workers, as the number of residents coming in-to Plainview (inflow) for employment was less than the number of residents leaving Plainview for work (outflow). Approximately 800 workers came into Plainview for work while 1,122 workers left, for a net outflow of -322 workers.

Housing Characteristics • The City of Plainview issued permits for the construction of 208 new residential units from

2000 to 2013, approximately 15 units annually. Over the same interval, Wabasha County is-sued 1,653 permits, or 118 units annually. In the early part of the decade before the start of the Recession, there was more robust permit activity than the later part. Comparatively, an annual average of 21 units were permitted annually in Plainview from 2000 through 2007 following which only 5 units were permitted annually through 2013.

• The overall median year built for a home in Plainview is 1970, on par with 1969 in the Mar-

ket Area overall. Median year built for renter-occupied housing was notably older than for owner-occupied housing in the Market Area (1961 versus 1973) but relatively similar in Plainview (1969 versus 1970).

• The dominant housing type in the Market Area is the single-family detached home, repre-senting an estimated 89.0% of all owner-occupied housing units and 44.5% of renter-occupied housing units as of 2012.

• Approximately 71% of Market Area homeowners have a mortgage. About 15.6% of home-

owners with mortgages in Plainview also have a second mortgage and/or home equity loan.

• The majority of the owner-occupied housing stock in the City of Plainview is estimated to be valued between $100,000 and $199,999 (61.0%).

• The median contract rent in Plainview and the Remainder of the Market Area was $461 and

$483, respectively. Based on a 30% allocation of income to housing, a household in Plainview would need an income of about $18,440 to afford an average monthly rent of $461 and an income of $19,320 in the Remainder of the Market Area to afford an average monthly rent of $483.

EXECUTIVE SUMMARY


Rental Housing Market Analysis • In order to assess the current market conditions for rental housing in Plainview, Maxfield

Research Inc. conducted an inventory of subsidized (i.e. housing that is income-restricted to households earning at or below 30% of the Area Median Income), affordable (i.e. housing that is income-restricted between 30% and 80% of the Area Median Income) and market rate (i.e. housing that is not income-restricted) projects located in the City.

• Our research of Plainview’s general occupancy rental market included a survey of three market rate apartment properties (6 units and larger) and three affordable/subsidized communities in February 2015. These projects represent a combined total of 66 units, in-cluding 14 market rate units and 52 affordable/subsidized units.

• At the time of our survey, no affordable/subsidized units were vacant. The industry stand-ard of 5% vacancy indicates a stabilized rental market, which promotes competitive rates, ensures adequate choice, and allows for unit turnover. However, Maxfield Research was unable to confirm the market rate vacancy rates due to a lack of participation from the properties.

• The average price per square foot monthly rent in Olmsted County was around $0.97.

However, we estimate that Plainview is around $0.65 per square foot; indicating rents over 30% lower than the Olmsted County average.

Senior Housing Market Analysis • As of February 2015, Maxfield Research identified three senior housing developments in the

Plainview Market Area. Combined, these projects contain a total of 76 units. One of the projects are subsidized, while the remaining two are market rate.

• Plainview Senior Housing has a total of 40 subsidized senior/or disabled senior units. As of

February 2015, there was no vacancies, which indicates pent-up demand for subsidized sen-ior rental units.

• There is one existing congregate senior project in the Plainview Market Area with a total of

18 units (Greenwood Prairie Place). As of February 2015, no vacancies were found. Gener-ally a healthy senior housing market will have a vacancy rate of around 5.0% in order to al-low for sufficient consumer choice and turnover.

• There is one existing assisted living senior project in the Plainview Market Area with a total

of 18 units (Greenwood Prairie Place). As of February 2015, no vacancies were found.

EXECUTIVE SUMMARY


Housing Affordability • About 23% of owner households and 35% of renter householders are estimated to be pay-

ing more than 30% of their income for housing costs in Plainview. Compared to the Minne-sota average, the percentage of cost burdened households is lower in Plainview. Minnesota cost burdened households are 25% for owner households and 49% for renter households.

• The number of cost burdened households in Plainview increases proportionally based on lower incomes. About 47% of renters with incomes below $35,000 are cost burdened and 50% of owners with incomes below $50,000 are cost burdened.

For-Sale Housing Market Analysis • Like most communities across Minnesota, the median sales price in Plainview bottomed out

during the Great Recession in 2009 at $118,900, however the median sales price and has gradually increased to $137,000 in 2014. Between 2009 and 2014 the median sales price has increased +15.2%.

• Between 2000 and 2014 Plainview has averaged 51 sales annually. Transactions during this time have ranged from 40 in 2013 to 70 in 2005.

• Based on a median list price of $135,200 in Plainview, the income required to afford a home

at this price would be about $38,630 to $45,065, based on the standard of 3.0 to 3.5 times the median income (and assuming these households do not have a high level of debt). A household with significantly more equity (in an existing home and/or savings) could afford a higher priced home. About 63.5% of Plainview households have annual incomes at or above $38,630.

• There are five active subdivisions with available lots in Plainview. Combined, there are 35 vacant lots. However, 60% of the vacant lots are zoned for twinhomes. As a result, there are only 14 vacant single-family lots in these subdivisions. New single-family lots are need-ed to meet future demand.

• The average assessed value for homes in the five active subdivisions is about $24,800 for the land and $161,200 for the total assessed value. Marketing lots in Plainview generally range from about $29,000 to $40,000. There have been no new platted subdivisions in Plainview since 2003.

• New construction activity in Plainview has been very slow since the market plateaued last decade between 2005 and 2007. Since 2010, there have been an average of only three new homes annually constructed in Plainview.

EXECUTIVE SUMMARY


Housing Needs Analysis • Based on our calculations, demand exists in Plainview for the following general occupancy

product types between 2014 and 2025: o Market rate rental 48 units o Affordable rental 18 units o Subsidized rental 17 units o For-sale single-family 123 units o For-sale multifamily 52 units

• In addition, we find demand for multiple senior housing product types. By 2020, demand in

Plainview for senior housing is forecast for the following: o Active adult ownership 16 units o Active adult market rate rental 30 units o Active adult affordable 16 units o Active adult subsidized 0 units o Congregate 14 units o Assisted Living 11 units o Memory care 16 units

Recommendations and Conclusions • Based on the finding of our analysis and demand calculations, the chart on the following

page provides a summary of the recommended development concepts by product type for the City of Plainview through 2025. Detailed findings are described in the Conclusions and Recommendations section of the report.

EXECUTIVE SUMMARY


Purchase Price/ Pct. DevelopmentMonthly Rent Range¹ of Total Timing

Owner-Occupied HomesSingle Family 2

Entry-level >$160,000 22 - 24 19% 2016+Move-up $160,000 - $225,000 50 - 52 43% 2015+Executive $250,000+ 44 - 46 38% 2016+

Total 116 - 122 100%Townhomes/Twinhomes 2

Entry-level >$150,000 18 - 20 39% 2016+Move-up $175,000+ 28 - 32 61% 2016+

Total 46 - 52 100%

Total Owner-Occupied 162 - 174

General Occupancy Rental Housing Market Rate Rental Housing

Apartment-style $650/1BR - $950/3BR 20 - 24 44% 2016+ Townhomes $825/2BR - $1,150/3BR 26 - 30 56% 2016+

Total 46 - 54 100%

Affordable Rental Housing Townhomes Moderate Income3 18 - 20 100% 2016+

Total 18 - 20 100%

Total Renter-Occupied 64 - 74

Senior Housing (i.e. Age Restricted)Active Adult Market Rate Rental $750/1BR - $1,000/2BR 26 - 30 43% 2017+

Catered Living4 $1,500/1BR - $3,500/2BR 22 - 26 37% 2016+Memory Care $3,800/EFF - $5,200/2BR 12 - 14 20% 2016+

Total 60 - 70 100%

Total - All Units 286 - 318

Source: Maxfield Research Inc.

¹ Pricing in 2015 dollars. Pricing can be adjusted to account for inflation.2 Recommendations include the absorption of some existing previously platted lots.3 Affordablity subject to income guidelines per Minnesota Housing Finance Agency. See Table HA-1 for Wabasha County Income limits.4 Catered living is a hybrid concept of congregate and assisted living service levels.

Note - Recommended development does not coincide with total demand. Plainview may not be able to accommodate all recommended housing types based on a variety of factors (i.e. development constraints, land availability, etc.)

RECOMMENDED HOUSING DEVELOPMENTCITY OF PLAINVIEW

2015 to 2025

No. of Units

DEMOGRAPHIC ANALYSIS


Introduction This section of the report examines factors related to the current and future demand for both owner- and renter-occupied housing in Plainview, Minnesota. It includes an analysis of popula-tion and household growth trends and projections, projected age distribution, household in-come, household types, household tenure, and a peer city comparison. A review of these char-acteristics will provide insight into the demand for various types of housing in the Market Area. Market Area Definition The primary draw area (Market Area) for housing in Plainview was defined based on traffic pat-terns, community and school district boundaries, geographic factors, and our general knowledge of the draw area. The Market Area is comprised of portions of Wabasha, Olmsted, and Winona counties, specifically inclusive of three cities (Plainview, Elgin, and Millville) and seven townships (Elgin, Highland, Oakwood, Plainview, Quincy, Viola, and Whitewater). Addi-tionally, this area is proximal to the City of Rochester in which the regional population and eco-nomic base is concentrated. The Destination Medical Center (“DMC”) is planned to transform Rochester into a worldwide destination for medical care. The DMC is projected to bring 35,000 to 45,000 new jobs to the State of Minnesota over the next few decades that will have a major impact on Southeastern Minnesota. Because of Plainview’s proximity to Rochester, Plainview has the potential to capture a portion of this growth. However, because the DMC is still in the initial planning phases and there are many unknowns, it is still premature to estimate to what extent housing demand will grow in the region. As a result, population and household projections in Table D-3 for Plainview could be exceeded as the effects of the DMC are speculative at this time.



Population and Household Growth from 2000 to 2010

Tables D-1 and D-2 present the population and household growth, respectively, of each Market Area city and township for 2000 and 2010. The data is from the U.S. Census Bureau. Population • The population in the City of Plainview grew by 150 people (+4.7%) between 2000 and 2010

to total 3,340 people in 2010.

• Population growth in the City of Plainview accounted for 54% of the total population growth in the Market Area over the decade. As of 2010, Plainview accounted for approximately 43% of the Market Area’s population.

• Growth slowed during the late 2000s due to the housing downturn during which several Market Area communities experienced population declines. Overall, however, the Market Area added +276 people between 2000 and 2010, increasing the Market Area population to 7,780 people as of 2010. This was a rate change of +3.7%.

• In 2010, the Market Area includes roughly 36% of the total population in Wabasha County.

2000 2010 No. Pct.

Plainview city 3,190 3,340 150 4.7%

Remainder of Market AreaElgin city 826 1,089 263 31.8%Elgin township 787 733 -54 -6.9%Highland township 471 462 -9 -1.9%Millvil le city 186 182 -4 -2.2%Oakwood township 433 405 -28 -6.5%Plainview township 498 443 -55 -11.0%Quincy township 356 339 -17 -4.8%Viola township 555 589 34 6.1%Whitewater township 202 198 -4 -2.0%

Subtotal 4,314 4,440 126 2.9%

Market Area Total 7,504 7,780 276 3.7%

Wabasha County 21,610 21,676 66 0.3%

Sources: U.S. Census Bureau; Maxfield Research Inc.

TABLE D-1HISTORIC POPULATION GROWTH TRENDS

PLAINVIEW MARKET AREA2000-2010

ChangeU.S. Census 2000-2010



Households • Household growth trends are typically a more accurate indicator of housing needs than

population growth since a household is, by definition, an occupied housing unit. However, additional demand can come from changing demographics of the population base, which results in demand for different housing products.

• Plainview added 121 households during the 2000s (+10.5%), increasing its household base

to 1,278 households as of 2010. The Remainder of the Market Area gained 131 households (+8.8%), during the decade, increasing to 1,628 households. Combined the Market Area to-taled 2,906 households in 2010.

• Household growth rates outpaced population growth in the Market Area during 2000s. The

Market Area’s population increased 3.7% compared to a 9.5% increase in households be-tween 2000 and 2010. This difference is the result of fewer persons in each household, caused by demographic and social trends such as increasing divorce rates, an increasing senior base, and couples’ decisions to have fewer children or no children at all.

2000 2010 No. Pct.

Plainview city 1,157 1,278 121 10.5%

Remainder of Market AreaElgin city 321 400 79 24.6%Elgin township 260 257 -3 -1.2%Highland township 147 165 18 12.2%Millvil le city 76 75 -1 -1.3%Oakwood township 139 145 6 4.3%Plainview township 166 167 1 0.6%Quincy township 124 125 1 0.8%Viola township 199 218 19 9.5%Whitewater township 65 76 11 16.9%

Sub-total 1,497 1,628 131 8.8%

Market Area Total 2,654 2,906 252 9.5%

Wabasha County 8,277 8,822 545 6.6%


Change

TABLE D-2HISTORIC HOUSEHOLD GROWTH TRENDS

PLAINVIEW MARKET AREA2000-2010

2000-2010U.S. Census



Population and Household Estimates and Projections Table D-3 presents population and household growth estimates and projections for the Market Area through 2025. Estimates for 2014 and projections through 2025 are based on information from ESRI (a national demographics service provider) and the Minnesota State Demographer with adjustments calculated by Maxfield Research Inc. The adjustments are intended to reflect growth that will likely be realized after considering the impact of the housing market slowdown and recession as well as the subsequent recoveries. Building permit data and trends are also incorporated into household growth estimates. • Over the current decade, we project that the City of Plainview will maintain similar rates of

household growth as the prior decade. Between 2010 and 2020, we estimate that 132 households (+10.3%) will be added in the City, stable from growth of 121 households (+10.5%) between 2000 and 2010.

• The Remainder of the Market Area is projected to increase by 197 households (+12.1%) be-tween 2010 and 2020, a slightly more rapid rate of growth than the prior decade during which 131 households (+8.8%) were added.

• Population growth is expected to slow slightly relative to household growth due to declining expectations in the number of persons per household. An additional 200 people (+6.0%) and 190 people (+4.3%) in the City of Plainview and Remainder of Market Area, respective-ly, are projected from 2010 to 2020.

• The Market Area overall is expected to increase by 390 people (+5.0%) by 2020, for a total

of 8,170 people. Over the same interval household growth is projected to increase by 329 households (+11.3%) to total 3,235 households.

• Growth expectations in the Market Area surpass those for Wabasha County, which is con-

sistent with historical growth comparisons between the geographies. Between 2010 and 2020, the household base in the Market Area will grow by +11.3% compared to the County’s +7.7% projected growth. Numerically, although the Market Area accounts for roughly one-third of the County’s total household base, it is projected to capture nearly 50% of the total projected household growth through 2020.



2000 2010 2014 2020 2025

Population No. No. No. No. No. No. Pct. No. Pct.

Plainview 3,190 3,340 3,350 3,540 3,615 150 4.7% 200 6.0%Remainder of PMA 4,314 4,440 4,450 4,630 4,745 126 2.9% 190 4.3%

PMA Total 7,504 7,780 7,800 8,170 8,360 276 3.7% 390 5.0%

Wabasha County 21,610 21,676 21,915 22,325 23,250 66 0.3% 649 3.0%

Households No. No. No. No. No. No. Pct. No. Pct.

Plainview 1,157 1,278 1,288 1,410 1,445 121 10.5% 132 10.3%Remainder of PMA 1,497 1,628 1,642 1,825 1,875 131 8.8% 197 12.1%

PMA Total 2,654 2,906 2,930 3,235 3,320 252 9.5% 329 11.3%

Wabasha County 8,277 8,822 8,982 9,500 9,935 545 6.6% 678 7.7%

Persons per Household

Plainview 2.76 2.61 2.60 2.51 2.50Remainder of PMA 2.88 2.73 2.71 2.54 2.53

PMA Total 2.83 2.68 2.66 2.53 2.52Wabasha County 2.61 2.46 2.44 2.35 2.34

Source: U.S. Census Bureau, ESRI, MN Demographer, Maxfield Research Inc.

TABLE D-3POPULATION & HOUSEHOLDS

PLAINVIEW MARKET AREA2000 to 2020

Number of People ChangeU.S. Census Projections

2000-2010 2010-2020



Age Distribution Trends

Age distribution affects demand for different types of housing since needs and desires change at different stages of the life cycle. Table D-4 shows the distribution of the population within nine age cohorts for Plainview and the Market Area in 2000 and 2010 with estimates for 2014 and projections for 2020. The 2000 and 2010 age distribution is from the U.S. Census Bureau and the 2014 figures are an estimate based on 2010 Census data combined with growth projec-tions calculated by ESRI. Maxfield Research Inc. derived the 2020 projections by adjustments made to data obtained from ESRI. The following are key points from the table. • Between 2000 and 2010, the majority of the growth in the City of Plainview occurred in the

middle aged and senior population (ages 45 to 64). Through 2020, numerical growth in the City is expected to be most robust among the 35 to 44 year old (143 people, +35.0%), under 18 years old (89 people, +9.6%), and 55 to 64 year old (82 people, +26.3%) cohorts.

• The 18 to 24 year old cohort, which consists of renters and first-time homebuyers, declined

between 2000-2010 and is projected to only modestly increase this decade (10 people, or +4.4%) in the City of Plainview.

• Mirroring trends observed across the Nation, the aging baby boomer generation is substan-

tially impacting the composition of the Market Area’s population. Born between 1946 and 1964, these individuals comprised the 45 to 54 and 55 to 64 year old cohorts in 2010. As of 2010, baby boomers accounted for roughly 26% of the Market Area’s population.



2000 2010 2014 2020

Plainview No. No. No. No. No. Pct. No. Pct.Under 18 935 919 921 1,008 -16 -1.7% 89 9.6%18 to 24 275 236 259 246 -39 -14.2% 10 4.4%25 to 34 433 523 473 448 90 20.8% -75 -14.4%35 to 44 460 408 442 551 -52 -11.3% 143 35.0%45 to 54 344 434 413 366 90 26.2% -68 -15.6%55 to 64 227 312 347 394 85 37.4% 82 26.3%65 to 74 192 215 234 278 23 12.0% 63 29.5%75 to 84 214 175 154 143 -39 -18.2% -32 -18.0%85+ 110 118 107 105 8 7.3% -13 -10.8%Total 3,190 3,340 3,350 3,540 150 4.7% 200 6.0%

Remainder of PMA No. No. No. No. No. Pct. No. Pct.Under 18 1,352 1,209 1,122 1,152 -143 -10.6% -57 -4.7%18 to 24 370 367 385 308 -3 -0.8% -59 -16.1%25 to 34 473 475 518 592 2 0.4% 117 24.6%35 to 44 805 598 539 558 -207 -25.7% -40 -6.7%45 to 54 555 790 693 610 235 42.3% -180 -22.8%55 to 64 325 513 647 731 188 57.8% 218 42.5%65 to 74 227 280 334 451 53 23.3% 171 61.2%75 to 84 158 156 156 174 -2 -1.3% 18 11.9%85+ 49 52 55 53 3 6.1% 1 1.9%Total 4,314 4,440 4,450 4,630 126 2.9% 190 4.3%

Primary Market Area No. No. No. No. No. Pct. No. Pct.Under 18 2,287 2,128 2,044 2,160 -159 -7.0% 32 1.5%18 to 24 645 603 644 554 -42 -6.5% -49 -8.1%25 to 34 906 998 991 1,040 92 10.2% 42 4.2%35 to 44 1,265 1,006 982 1,109 -259 -20.5% 103 10.2%45 to 54 899 1,224 1,106 976 325 36.2% -248 -20.2%55 to 64 552 825 995 1,125 273 49.5% 300 36.4%65 to 74 419 495 568 730 76 18.1% 235 47.4%75 to 84 372 331 310 318 -41 -11.0% -13 -3.9%85+ 159 170 162 158 11 6.9% -12 -6.9%Total 7,504 7,780 7,800 8,170 276 3.7% 390 5.0%

Sources: U.S. Census, Maxfield Research Inc., ESRI, Inc.

TABLE D-4POPULATION AGE DISTRIBUTION


Number of PeopleChangeU.S. Census Projections

2000-2010 2010-2020

• Numerically, the 55 to 64 and 65 to 74 age cohorts are projected to have significant growth

in the Market Area between 2010 and 2020, increasing by 300 people (+36.4%) and 235 people (+47.4%), respectively. The growth in these age cohorts can be primarily attributed to the baby boom generation aging into their older adult and young senior years.



• The social changes that occurred with the aging of the baby boom generation, such as high-er divorce rates, higher levels of education, and lower birth rates has led to a greater variety of lifestyles than existed in the past – not only among the baby boomers, but also among their parents and children. The increased variety of lifestyles has fueled demand for alter-native housing products to the single-family homes. Seniors, in particular, and middle-aged persons tend to do more traveling and participate in more activities than previous genera-tions, and they increasingly prefer maintenance-free housing that enables them to spend more time on activities outside the home.

Household Income by Age of Householder The estimated distribution of household incomes in Plainview and the Market Area for 2014 and 2020 are shown in Tables D-5 and D-6. The data was estimated by Maxfield Research Inc. based on income trends provided by ESRI. The data helps ascertain the demand for different housing products based on the size of the market at specific cost levels. The Department of Housing and Urban Development defines affordable housing costs as 30% of a household’s adjusted gross income. For example, a household with an income of $50,000 per year would be able to afford a monthly housing cost of about $1,250. Maxfield Research Inc. uses a figure of 25% to 30% for younger households and 40% or more for seniors, since seniors generally have lower living expenses and can often sell their homes and use the proceeds to-ward rent payments.



A generally accepted standard for affordable owner-occupied housing is that a typical house-hold can afford to pay 3.0 to 3.5 times their annual income on a single-family home. Thus, a $50,000 income would translate to an affordable single-family home of $150,000 to $175,000. The higher end of this range assumes that the person has adequate funds for down payment and closing costs, but does not include savings or equity in an existing home which would allow them to purchase a home higher than the upper end of the range. City of Plainview Trends • Plainview had an estimated median household income of $52,797 in 2014. It is projected to

increase to $58,448 (+10.9%) by 2020. • With a household income of $54,333, a younger household (the median household income

for the 25 to 34 cohort in Plainview) could afford a monthly housing cost of about $1,360, based on an allocation of 30% of income toward housing.

• A younger senior household with an income of $43,407 (the median household income for

the 65 to 74 age cohort in Plainview) could afford a monthly housing cost of about $1,445, based on an allocation of 40% of income toward housing. Older seniors (age 75+ would be able to afford a monthly housing cost of about $950 based on the same income allocation.



Total <25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 116 14 16 16 9 15 13 32$15,000 to $24,999 139 13 21 24 15 12 13 39$25,000 to $34,999 176 6 26 30 30 17 28 40$35,000 to $49,999 160 5 31 18 25 28 31 22$50,000 to $74,999 308 6 65 56 52 65 36 28$75,000 to $99,999 189 3 30 31 68 41 11 5$100,000 or more 201 3 35 73 36 26 16 11Total 1,288 51 224 249 235 205 148 176

Median Income $52,797 $22,733 $54,333 $63,380 $66,234 $58,321 $43,407 $28,525


Median Income $58,558 $25,000 $58,525 $71,782 $75,485 $62,711 $51,204 $32,462

Less than $15,000 5 2 -2 2 -1 1 1 2$15,000 to $24,999 -26 -2 -3 -2 -4 -2 -3 -9$25,000 to $34,999 -34 -0 -7 -4 -10 -2 -3 -8$35,000 to $49,999 4 1 -2 3 -6 2 4 2$50,000 to $74,999 57 1 6 20 -1 11 13 7$75,000 to $99,999 57 1 7 17 8 16 6 3$100,000 or more 60 1 5 29 2 8 11 3Total 122 3 3 65 -13 34 29 1

Median Income $5,761 $2,267 $4,192 $8,402 $9,251 $4,390 $7,797 $3,937

Sources: ESRI; US Census Bureau; Maxfield Research Inc.

2020

Change 2014 - 2020

Age of Householder

TABLE D-5HOUSEHOLD INCOME BY AGE OF HOUSEHOLDER

CITY OF PLAINVIEW2014 & 2020

2014



Total <25 25-34 35-44 45-54 55-64 65 -74 75+


Median Income $60,227 $32,877 $59,921 $75,188 $76,397 $69,586 $48,149 $31,698


Median Income $69,060 $36,668 $68,423 $81,471 $81,526 $77,554 $58,674 $37,023

Less than $15,000 -3 0 -3 -2 -7 -3 3 7$15,000 to $24,999 -51 -3 -6 -5 -8 -7 -8 -15$25,000 to $34,999 -59 -2 -10 -7 -16 -5 -6 -13$35,000 to $49,999 -7 -1 -5 -3 -17 -1 7 14$50,000 to $74,999 75 2 13 17 -15 11 30 16$75,000 to $99,999 132 1 26 26 8 41 23 5$100,000 or more 218 1 34 52 15 51 53 12Total 305 -1 49 78 -40 89 102 27

Median Income $8,833 $3,791 $8,502 $6,283 $5,129 $7,968 $10,525 $5,325

Sources: ESRI; US Census Bureau; Maxfield Research Inc.

2020

Change 2014 - 2020

Age of Householder

TABLE D-6HOUSEHOLD INCOME BY AGE OF HOUSEHOLDER

PLAINVIEW MARKET AREA2014 & 2020

2014

Market Area Non-Senior Household Trends • In 2014, 6.8% of the non-senior (under age 65) households in the Market Area had incomes

under $15,000 (154 households). All of these households would be eligible for subsidized rental housing. An additional 5.8% of the Market Area’s non-senior households had in-comes between $15,000 and $24,999 (131 households). Many of these households would qualify for subsidized housing, but many could also afford “affordable” or older market rate



rentals. If housing costs absorb 30% of income, households with incomes of $15,000 to $24,999 could afford to pay $375 to $625 per month.

• Median incomes for households in the Market Area peak at $76,397 for the 45 to 54 age

group in 2014. Households in this age group are in their peak earning years. By 2020, the median income for the 45 to 54 age group is projected to increase to $81,526, an increase of 6.7%.

• The median resale price of homes in Plainview was $137,000 through 2014 (see Table FS-1).

The income required to afford a home at this price would be about $39,143 to $45,667, based on the standard of 3.0 to 3.5 times the median income (and assuming these house-holds do not have a high level of debt).

• Overall median incomes are expected to increase by +14.7% between 2014 and 2020 in the

Market Area. By 2020, the median income is projected to be $69,060. Market Area Senior Household Trends • The oldest householders are likely to have lower incomes in 2014. In the Market Area,

10.5% of households ages 65 to 74 had incomes below $15,000, compared to 13.1% of households ages 75 and over. Many of these low-income older senior households rely sole-ly on social security benefits. Typically, younger seniors have higher incomes due to the fact they are still able to work or are married couples with two pensions or higher social security benefits. The 2014 median incomes for Market Area householders age 65 to 74 and 75+ are $48,149 and $31,698, respectively.

• Generally, senior households with incomes greater than $30,000 can afford market rate

senior housing. Based on a 40% allocation of income for housing, this translates to monthly rents of at least $1,000. About 441 senior households in the Market Area (64.8% of age 65+ households) had incomes above $30,000 in 2014.

• Seniors who are able and willing to pay 80% or more of their income on assisted living hous-

ing would need an annual income of $33,000 to afford monthly rents of $2,200, which is about the beginning monthly rent for assisted living projects in the Market Area. Typically, seniors age 75 and over are the primary market for assisted living housing. There were an estimated 160 older senior (ages 75 and over) households with incomes greater than $33,000 in 2014.

• The median income for all seniors (age 65 to 74 and age 75+ cohorts) is a weighted average of $40,252 in 2014, projected to increase to $49,215 by 2020 (+22.3%).



Net Worth

Table D-7 shows household net worth in the City of Plainview and Market Area in 2014. Simply stated, net worth is the difference between assets and liabilities, or the total value of assets af-ter the debt is subtracted. The data was compiled and estimated by ESRI based on the Survey of Consumer Finances and Federal Reserve Board data. According to data released by the National Association of Realtors in 2012, the average Ameri-can homeowner has a net worth about 34 times greater than that of a renter. This research was based on the 2007 to 2010 Federal Reserve survey that showed the average net worth of a homeowner was $174,500, whereas the average net worth of a renter was $5,100.

• The Market Area had an average net worth of $540,110 in 2014 and a median net worth of

$150,894. Median net worth is generally a more accurate depiction of wealth than the av-erage figure. A few households with very large net worth can significantly skew the aver-age. Communities with high levels of farming equipment and land assets like the Market Area tend to have higher average and median net worth as a result of these assets. As a comparison, the Twin Cities Metro Area had an average net worth of $586,479 and median net worth of $111,991.

• Similar to household income, net worth increases as households age and decreases after

they pass their peak earning years and move into retirement. Median and average net worth usually peak in the 55 to 64 age cohort, as is true for the Plainview Market Area. The median net worth is $250,001 among all cohorts age 55 and older. Average net worth peaks among age 65 to 74 year olds at $1,055,117, which is likely due to farm equipment and land assets being primarily retained by households in this age cohort.



• Households often delay purchasing homes and instead choose to rent until they acquire suf-ficient net worth to cover the costs of a down payment and closing costs associated with home ownership. This will be especially true in the short-term as tightening lending re-quirements make mortgages with little or no down payments more difficult to obtain. Thus, in the younger age cohorts especially, households at or below the median net worth will likely delay their entries into home ownership due to inadequacy of funds.

Total % of Total <25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 260 20.2% 24 61 70 30 26 13 36$15,000 to $34,999 80 6.2% 11 29 13 10 5 3 8$35,000 to $49,999 56 4.4% 4 16 17 5 4 6 3$50,000 to $99,999 208 16.2% 7 61 56 36 17 13 17$100,000 to $149,999 127 9.8% 4 29 25 26 16 13 12$150,000 to $249,999 164 12.8% 0 19 32 37 28 24 25$250,000 or more 393 30.5% 0 8 36 92 109 75 74Total 1,288 100% 51 224 249 235 205 148 176

Median Net Worth $112,914 $15,934 $52,357 $64,673 $171,183 $250,001 $250,001 $186,260

Less than $15,000 535 18.2% 43 116 140 89 69 34 44$15,000 to $34,999 161 5.5% 21 55 31 23 13 9 8$35,000 to $49,999 107 3.6% 7 30 35 9 11 11 3$50,000 to $99,999 402 13.7% 8 117 116 62 37 30 32$100,000 to $149,999 254 8.7% 5 63 51 43 37 28 26$150,000 to $249,999 408 13.9% 0 42 80 85 108 43 50$250,000 or more 1,063 36.3% 0 32 93 275 300 199 164Total 2,930 100% 84 456 547 586 575 354 327

Median Net Worth $150,894 $14,821 $56,509 $71,807 $222,105 $250,001 $250,001 $250,001

Sources: ESRI; Maxfield Research, Inc.

Data Note: Net Worth is total household wealth minus debt, secured and unsecured. Net worth includes home equity, equity in pension plans, net equity in vehicles, IRAs and Keogh accounts, business equity, interest-earning assets and mutual fund shares, stocks, etc. Examples of secured debt include home mortgages and vehicle loans; examples of unsecured debt include credit card debt, certain bank loans, and other outstanding bil ls. Forecasts of net worth are based on the Survey of Consumer Finances, Federal Reserve Board. Detail may not sum to totals due to rounding.

Age of Householder

CITY OF PLAINVIEW

MARKET AREA

TABLE D-7NET WORTH BY AGE OF HOUSEHOLDER

PLAINVIEW MARKET AREA2014



Tenure by Household Income

Table D-8 shows estimated household tenure by income in the Market Area according to data from the 2008-2012 American Community Survey. As stated earlier, the Department of Housing and Urban Development determines affordable housing as not exceeding 30% of the household’s income. It is important to note that the high-er the income, the lower percentage a household typically allocates to housing. Many lower in-come households, as well as many young and senior households, spend more than 30% of their income on housing, while middle-aged households in their prime earning years typically allo-cate 20% to 25% of their income to housing. • Typically, as income increases, so does the rate of homeownership. This can be seen in the

Market Area, where the homeownership rate increases from 45% of households with in-comes below $15,000 to over 95% of households with incomes above $75,000.

• A portion of renter households that are referred to as lifestyle renters, or those who are fi-nancially able to own but choose to rent, have household incomes above $50,000 and rent newer apartments (about 21% of Market Area renter households). A smaller segment of lifestyle renters could also have lower incomes and be living in older apartments.

• Households with incomes below $15,000 are the typical market for deep subsidy rental

housing (approximately 20% of renter households in the Market Area) whereas those with incomes between $15,000 and $35,000 are the market for affordable rental housing (43.4% of renter households in the Market Area).

• In the City of Plainview, the current supply of rental housing product likely limits renter

rates somewhat. The majority of renter households in the City has incomes at or below $35,000 (78.3% of renter households in the City of Plainview). Additionally, homeownership rates in rural or peripheral communities tend toward homeownership at higher incomes due to household preference and lack of sufficient support for rental communities at high-er-end price points.



Owner- Renter- Owner- Renter- Owner- Renter-Income Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct.

Less than $15,000 32 36.4% 56 63.6% 58 51.8% 54 48.2% 90 45.0% 110 55.0%$15,000 to $24,999 99 60.0% 66 40.0% 38 41.3% 54 58.7% 137 53.3% 120 46.7%$25,000 to $34,999 69 45.1% 84 54.9% 100 75.2% 33 24.8% 169 59.1% 117 40.9%$35,000 to $49,999 195 79.9% 49 20.1% 213 84.9% 38 15.1% 408 82.4% 87 17.6%$50,000 to $74,999 254 96.9% 8 3.1% 232 77.3% 68 22.7% 486 86.5% 76 13.5%$75,000 to $99,999 162 100.0% 0 0.0% 251 92.6% 20 7.4% 413 95.4% 20 4.6%$100,000 to $149,999 148 100% 0 0.0% 356 97.5% 9 2.5% 504 98.2% 9 1.8%$150,000+ 43 100.0% 0 0.0% 106 93.8% 7 6.2% 149 95.5% 7 4.5%Total 1,002 79.2% 263 20.8% 1,354 82.7% 283 17.3% 2,356 81.2% 546 18.8%

Median Income

Sources: U.S. Census Bureau - American Community Survey; Maxfield Research Inc.

TABLE D-8TENURE BY HOUSEHOLD INCOME


PLAINVIEW REMAINDER MARKET AREA TOTAL

$32,927$56,574 $25,495 $80,805 $39,833 $70,500



Tenure by Age of Householder Table D-9 shows the number of owner and renter households in the Market Area by age group in 2000 and 2010. This data is useful in determining demand for certain types of housing since housing preferences change throughout an individual’s life cycle. The following are key findings from the table. • In most markets, the housing market downturn contributed to a decrease in the home-

ownership rate during the late 2000s as it became more difficult for households to secure mortgage loans, households delayed purchasing homes due to the uncertainty of the hous-ing market, and foreclosures forced households out of their homes. However, in the Plainview Market Area, the rate of homeownership held relatively consistent at 82.2% in 2010 from 81.0% in 2000.

• The number of owner households in the Market Area increased by +11.1% compared to a +2.8% increase in renter households between 2000 and 2010.

• As households progress through their life cycle, housing needs change. The proportion of

renter households decreases significantly as households age out of their young-adult years. However, by the time households reach their senior years, rental housing often becomes a more viable option than homeownership, reducing the responsibility of maintenance and a financial commitment. The figure below visually illustrates the dip in renter households during the middle aged cohorts with a gradual increase in senior aged cohorts.



Owners Renters H.O.R. Owners Renters H.O.R.

PlainviewHouseholder 15 to 24 years 44 26 62.9% 27 22 55.1%Householder 25 to 34 years 161 50 76.3% 195 49 79.9%Householder 35 to 44 years 220 37 85.6% 205 23 89.9%Householder 45 to 54 years 182 19 90.5% 216 31 87.4%Householder 55 to 64 years 116 12 90.6% 162 21 88.5%Householder 65 to 74 years 98 16 86.0% 115 18 86.5%Householder 75 to 84 years 103 32 76.3% 85 33 72.0%Householder 85 years and over 20 21 48.8% 36 40 47.4%Total 944 213 81.6% 1041 237 81.5%

Remainder of PMAHouseholder 15 to 24 years 12 55 17.9% 17 35 32.7%Householder 25 to 34 years 150 70 68.2% 154 69 69.1%Householder 35 to 44 years 332 77 81.2% 271 52 83.9%Householder 45 to 54 years 287 33 89.7% 358 50 87.7%Householder 55 to 64 years 175 18 90.7% 270 27 90.9%Householder 65 to 74 years 123 14 89.8% 151 21 87.8%Householder 75 to 84 years 95 17 84.8% 85 21 80.2%Householder 85 years and over 33 6 84.6% 42 5 89.4%Total 1207 290 80.6% 1348 280 82.8%

PMAHouseholder 15 to 24 years 56 81 40.9% 44 57 43.6%Householder 25 to 34 years 311 120 72.2% 349 118 74.7%Householder 35 to 44 years 552 114 82.9% 476 75 86.4%Householder 45 to 54 years 469 52 90.0% 574 81 87.6%Householder 55 to 64 years 291 30 90.7% 432 48 90.0%Householder 65 to 74 years 221 30 88.0% 266 39 87.2%Householder 75 to 84 years 198 49 80.2% 170 54 75.9%Householder 85 years and over 53 27 66.3% 78 45 63.4%Total 2151 503 81.0% 2389 517 82.2%

Sources: U.S. Census Bureau, Maxfield Research Inc.

TABLE D-9TENURE BY AGE OF HOUSEHOLDER


2000 2010

• In 2010, 44.9% of the Market Area’s households between the ages of 15 and 24 rented

their housing, compared to 20.1% of households between the ages of 25 and 34. House-holders between 35 and 74 were overwhelmingly homeowners, with no more than 15% of the householders in each 10-year age cohort renting their housing.

• Rate of homeownership is similar in the City of Plainview relative to the Market Area over-

all. In 2010, 81.5% of households in the City were homeowners. High rates of homeowner-ship, in general, are common in areas with a rural character where traditional agricultural



land use and lack of infrastructure typically cannot support higher density rental housing. In addition, homeownership is more feasible in outlying rural areas because the cost of owning a single-family home in communities located in the Market Area is typically lower relative to larger, more population-dense cities.

Tenure by Household Size Table D-10 shows household tenure by size of household in the Market Area during 2000 and 2010 from the U.S. Census Bureau. The tables show the number and percent of renter- and owner-occupied housing units in the Market Area. All data excludes unoccupied units and group quarters such as nursing homes. • Household size for renters tends to be smaller than for owners. This trend is a result of the

typical market segments for rental housing, including households that are younger and less likely to be married with children, as well as older adults and seniors who choose to down-size from their single-family homes.

• In 2000, the average renter household in the Market Area consisted of 2.29 persons, while

the average owner households included 2.89 persons. By 2010, the average household size decreased slightly to 2.16 persons in renter households, while the average owner household size decreased to 2.76 persons. The decline in owner household sizes can be attributed, in large part, to a shift toward older households and fewer married couple families with chil-dren. Overall there were 2.68 persons per household in the Market Area in 2010.

• In 2010, 35% of all Market Area households were comprised of two persons while 21% were one-person households. Approximately 17% were three-person households, 15% of the households consisted of four persons, and 8% were five-person households. There were few six- and seven-person households in the Market Area.

• Smaller households comprised the greatest proportion of renter households in the Market

Area in 2010. In the Market Area, 43% of the total renter households were one-person households and 26% were two-person households.

• The only growth in renter households over the decade occurred in the number of one-

person renter households, which gained 28 households (+14.4%). This growth offset minor losses in every other household size among renter households.

• The remainder of household growth from 2000 to 2010 occurred among homeowners,

among which the most significant growth was in the two-person household segment (177 households, +24.9%).



HH Size No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

1-person Own 177 63.7 213 64.2 186 66.4 188 64.4 363 65.1 401 64.3Rent 101 36.3 119 35.8 94 33.6 104 35.6 195 34.9 223 35.7

Total 278 100.0 332 100.0 280 100.0 292 100.0 558 100.0 624 100.0

2-person Own 317 85.0 366 88.0 394 83.5 522 86.4 711 84.1 888 87.1Rent 56 15.0 50 12.0 78 16.5 82 13.6 134 15.9 132 12.9

Total 373 100.0 416 100.0 472 100.0 604 100.0 845 100.0 1,020 100.0

3-person Own 148 85.1 174 84.9 184 77.6 230 83.6 332 80.8 404 84.2Rent 26 14.9 31 15.1 53 22.4 45 16.4 79 19.2 76 15.8

Total 174 100.0 205 100.0 237 100.0 275 100.0 411 100.0 480 100.0

4-person Own 191 94.6 162 89.5 233 86.0 238 89.5 424 89.6 400 89.5Rent 11 5.4 19 10.5 38 14.0 28 10.5 49 10.4 47 10.5

Total 202 100.0 181 100.0 271 100.0 266 100.0 473 100.0 447 100.0

5-person Own 73 86.9 94 91.3 143 89.9 115 87.8 216 88.9 209 89.3Rent 11 13.1 9 8.7 16 10.1 16 12.2 27 11.1 25 10.7

Total 84 100.0 103 100.0 159 100.0 131 100.0 243 100.0 234 100.0

6+ person Own 38 82.6 32 78.0 67 85.9 55 91.7 105 33.8 87 86.1Rent 8 17.4 9 22.0 11 14.1 5 8.3 19 6.1 14 13.9

Total 46 100.0 41 100.0 78 100.0 60 100.0 311 39.9 101 100.0

TOTAL Own 944 81.6 1,041 81.5 1,207 80.6 1,348 82.8 2,151 81.0 2,389 82.2Rent 213 18.4 237 18.5 290 19.4 280 17.2 503 19.0 517 17.8

Total 1,157 100.0 1,278 100.0 1,497 100.0 1,628 100.0 2,654 100.0 2,906 100.0


2.90 2.68

2010

3.01 2.73

2000 2010

Average HH Size 2.76 2.61

20002000 2010

TABLE D-10TENURE BY HOUSEHOLD SIZE


City of Plainview Market Area TotalRemainder

Ethnicity and Diversity Table D-11 summarizes the population by race in the City of Plainview and Market Area as well as compares this to Wabasha County as a whole. Data is provided from the 2000 and 2010 U.S. Census. • As of 2000, 8.3% of the total population in the City of Plainview was minorities, which in-

creased to 13.0% by 2010. The greatest percentage of minorities in the City was Hispanic (7.8% of the total population in 2010).



• Compared to the Market Area and Wabasha County, the City had a greater percentage of minorities in both 2000 and 2010; as of 2010, 13.0% of the total population was among mi-nority groups in the City compared to 7.6% in the Market Area and 5.8% in Wabasha Coun-ty.

Plainview No. Pct. No. Pct.Non-Hispanic 3,026 94.9% 3,078 92.2% White 2,925 91.7% 2,907 87.0% Black or African American 1 0.0% 6 0.2% American Indian and Alaska Native 2 0.1% 4 0.1% Asian 3 0.1% 11 0.3% Native Hawaiian and Other Pacific Islander 0 0.0% 1 0.0% Other & two or more races 95 3.0% 149 4.5%Hispanic 164 5.1% 261 7.8%Total Population 3,190 100.0% 3,340 100.0%Percent Minority -- 8.3% -- 13.0%

Market Area No. Pct. No. Pct.Non-Hispanic 7,300 97.3% 7,457 95.8% White 7,143 95.2% 7,187 92.4% Black or African American 3 0.0% 20 0.3% American Indian and Alaska Native 9 0.1% 8 0.1% Asian 10 0.1% 41 0.5% Native Hawaiian and Other Pacific Islander 0 0.0% 1 0.0% Other & two or more races 135 1.8% 200 2.6%Hispanic 204 2.7% 323 4.2%Total Population 7,504 100.0% 7,780 100.0%Percent Minority -- 4.8% -- 7.6%

Wabasha CountyTotal Population 21,610 -- 21,676 --Minority Population & Pct. Minority 803 3.7% 1,268 5.8%

Sources: U.S. Census, Maxfield Research Inc.

2000 2010

2000 and 2010

TABLE D-11ETHNICITY AND DIVERSITYPLAINVIEW MARKET AREA



Mobility Tables D-12 and D-13 present data on the mobility of Market Area residents according to the American Community Survey. The tables show the number and percent of area residents who moved within the past year and to what locations. The data is presented both by geography of origin as well as by age cohort.

• The youngest cohorts tend to be the most mobile. Of the total 724 people in the Market Ar-ea who moved in the past year, 29.6% were 18 to 24 years old, 26.1% were under 18 years



old, and 17.5% were 25 to 34 years old. Other age cohorts moved at a rate of less than 10%, dipping to lowest or least mobile percentage of 1.1% among the 65 to 74 age cohort.

• By percentage within the same age cohort, the most mobile group was 18 to 24 years old with 69.3% staying within the same home over the interval compared to the overall rate of 90.6%.

• An estimated 87.6% of Plainview residents and 90.6% of Market Area residents did not

move in the past year.

• Among Market Area residents, 724 moved within the past year, the majority of which moved within the same county (54.9% of households that moved, or 6.8% of all house-holds). An additional 26.5% of households that moved relocated from counties within the state and 18.7% relocated from a different state.

No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

Plainview 2,900 87.6% 226 6.8% 109 3.3% 77 2.3% 0 0.0%Remainder Market Area 4,073 92.9% 165 3.8% 113 2.6% 24 0.5% 10 0.2%Market Area Total 6,973 90.6% 391 5.1% 222 2.9% 101 1.3% 10 0.1%

Wabasha County 19,929 92.9% 754 3.5% 518 2.4% 195 0.9% 54 0.3%


TABLE D-12MOBILITY IN THE PAST YEAR BY LOCATION FOR CURRENT RESIDENCE


Not Moved Moved

Same House Within Same County

Different County Same State

Different State Abroad

Age No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

Under 18 1,864 90.8% 150 7.3% 33 1.6% 6 0.3% 0 0.0%18 to 24 482 69.3% 112 16.1% 46 6.6% 53 7.6% 3 0.4%25 to 34 797 86.3% 46 5.0% 78 8.4% 3 0.3% 0 0.0%35 to 44 950 93.0% 19 1.9% 15 1.5% 37 3.6% 0 0.0%45 to 54 1,200 95.9% 44 3.5% 0 0.0% 0 0.0% 7 0.6%55 to 64 819 96.8% 20 2.4% 5 0.6% 2 0.2% 0 0.0%65 to 74 397 98.0% 0 0.0% 8 2.0% 0 0.0% 0 0.0%75+ 464 92.6% 0 0.0% 37 7.4% 0 0.0% 0 0.0%Total 6,973 90.6% 391 5.1% 222 2.9% 101 1.3% 10 0.1%


Same House Within Same Count AbroadDifferent County Same State

Different State

Moved

TABLE D-13MOBILITY IN THE PAST YEAR BY AGE FOR CURRENT RESIDENCE


Not Moved



Demographic Comparison to Peer Cities Table D-14 provides a demographic summary comparison for Plainview and surrounding cities.

• Compared to the surrounding cities, Plainview has the third highest median household in-

come at $49,366. St. Charles has the highest median household income at $57,235.

• Plainview has the second lowest contract rent ($461) compared to the surrounding cities. Spring Valley had a lower contract rent ($366).

• In comparison to the other peer cities, Plainview has the lowest percentage of households

of people living alone (26%). The highest percentage is found in Spring Valley (35.2%).

• Plainview has the highest homeownership rate (81.5%) amongst the peer cities. The lowest homeownership rate is found in Spring Valley (73.2%).



Num Pct. Num Pct. Pct. Num Pct. Num Pct. Num Pct.

Demographic SummaryPopulation (2010)Households (2010)HH Size

HH Income/Median (2012)

Percent HH's w/Children (2010)Percent HH's Living Alone (2010)

Housing CharacteristicsPercent Own (2010)Percent Rent (2010)Median Housing Value (2012)Median Contract Rent (2012)1

1 Median contract rents subject to margin of error and includes income-restricted units

Source: U.S. Census Bureau; Maxfield Research, Inc.

$126,100 $169,100 $108,400 $127,200 $145,300

30.5%

76.9%23.1%

$520

3,2521,3492.41

$46,027

23.6%

$155,20018.5% 26.7% 26.8% 25.0% 24.8%

2.40 2.54

24.7% 25.6% 19.2% 18.8% 26.5%

2.61 2.64 2.31

$49,366 $57,235 $44,571 $44,107 $51,223

1,278 1,416 1,074 755 1,0923,340 3,735 2,479 1,815 2,779

TABLE D-14DEMOGRAPHIC SUMMARY

COMPARABLE CITIES THROUGHOUT MINNESOTA

Plainview St. Charles Spring Valley Kenyon Chatfield Zumbrota

75.2%

26.0% 26.2% 35.2% 31.7% 26.9%

81.5% 73.3% 73.2% 75.0%

$635$512 $366$461 $615

EMPLOYMENT TRENDS


Introduction

Since employment growth generally fuels household growth, employment trends are a reliable indicator of housing demand. Typically, households prefer to live near work for convenience. However, housing in outlying areas is often more affordable and/or offers attractive quality of life features, making commuting from outlying communities to work in larger employment cen-ters an attractive alternative among some population segments. Employment Growth & Projections Table E-1 shows projected employment growth based on the most recent information available from the Minnesota Department of Employment and Economic Development (DEED). The 2020 forecast is based on 2010 to 2020 industry projections for the Southeast Minnesota Region, which includes Wabasha County as well as the following counties: Dodge, Fillmore, Freeborn, Goodhue, Houston, Mower, Olmsted, Rice, Steele, and Winona. The Seven-County Twin Cities Metro Area is also included for comparison. Maxfield Research applied the project-ed ten-year growth rate of 12.0% for the Twin Cities to the 2010 employment data to arrive at the 2020 forecast for the Metro Area.

Estimate Forecast

2010 2020

No. No. No. Pct.

SE Minnesota 255,288 291,672 36,384 14.3%

Twin Cities Metro Area 1,680,012 1,882,072 202,060 12.0%

Sources: MN DEED; Maxfield Research Inc.

TABLE E-1EMPLOYMENT PROJECTIONS

SOUTHEAST MINNESOTA2010-2020

2010-2020

EMPLOYMENT TRENDS


Resident Labor Force Recent employment growth trends are shown in Tables E-2 and E-3. The data in both tables is from the Minnesota Department of Employment and Economic Development (DEED). Table E-2 presents resident employment data in Wabasha County from 2000 through 2013. Da-ta is not available at the city level for Plainview but is provided for Wabasha County as a whole and summarized in the tables. Additional figures on the Rochester Metropolitan Statistical Area and State of Minnesota are provided for comparison. Resident employment data is calculated as an annual average and reveals the work force and number of employed persons living in the County. It is important to note that not all of these individuals necessarily work in the County. Table E-3 presents covered employment in Wabasha County from 2000 through 2013. Covered employment data is calculated as an annual average and reveals the number of jobs in the County, which are covered by unemployment insurance. Most farm jobs, self-employed per-sons, and some other types of jobs are not covered by unemployment insurance and are not in-cluded in the table. Resident Employment • Resident employment in Wabasha County decreased by -667 people between 2000 and

2013 (-5.6%). The unemployment rate increased from 2.9% (2000) to 4.6% (2013).

EMPLOYMENT TRENDS


LaborYear Force Employed Unemployed Rate

2000 12,300 11,945 355 2.9%2001 12,603 12,175 428 3.4%2002 12,661 12,176 485 3.8%2003 12,681 12,128 553 4.4%2004 12,694 12,141 553 4.4%2005 12,592 12,066 526 4.2%2006 12,492 11,979 513 4.1%2007 12,231 11,680 551 4.5%2008 12,106 11,499 607 5.0%2009 12,295 11,330 965 7.8%2010 11,976 11,152 824 6.9%2011 11,783 11,078 705 6.0%2012 11,778 11,178 600 5.1%2013 11,825 11,278 547 4.6%

Change 2000-2013 Number -475 -667 192 -- Percent -3.9% -5.6% 54.1% --

2000 95,142 92,561 2,581 2.7%2001 97,822 94,866 2,956 3.0%2002 99,925 96,035 3,890 3.9%2003 100,669 96,314 4,355 4.3%2004 101,830 97,701 4,129 4.1%2005 102,038 98,289 3,749 3.7%2006 102,319 98,644 3,675 3.6%2007 103,324 99,223 4,101 4.0%2008 103,270 98,551 4,719 4.6%2009 105,187 98,217 6,970 6.6%2010 104,272 97,804 6,468 6.2%2011 104,022 98,342 5,680 5.5%2012 105,269 100,422 4,847 4.6%2013 105,832 101,324 4,508 4.3%

Change 2000-2013 Number 10,690 8,763 1,927 -- Percent 11.2% 9.5% 74.7% --

ROCHESTER METROPOLITAN STATISTICAL AREA

2000 to 2013WABASHA COUNTY, ROCHESTER MSA, & MINNESOTA

ANNUAL AVERAGE RESIDENT EMPLOYMENTTABLE E-2

Sources: MN Workforce Center, Maxfield Research Inc.

WABASHA COUNTY

EMPLOYMENT TRENDS


LaborYear Force Employed Unemployed Rate

2000 2,807,668 2,720,492 87,176 3.1%2001 2,866,023 2,755,808 110,215 3.8%2002 2,880,329 2,749,525 130,804 4.5%2003 2,891,661 2,750,938 140,723 4.9%2004 2,885,974 2,752,403 133,571 4.6%2005 2,876,953 2,756,709 120,244 4.2%2006 2,893,029 2,774,524 118,505 4.1%2007 2,903,453 2,768,068 135,385 4.7%2008 2,929,859 2,771,749 158,110 5.4%2009 2,950,277 2,713,601 236,676 8.0%2010 2,962,633 2,744,470 218,163 7.4%2011 2,969,696 2,777,285 192,411 6.5%2012 2,969,366 2,801,671 167,695 5.6%2013 2,973,511 2,822,648 150,863 5.1%

Change 2000-2013 Number 165,843 102,156 63,687 -- Percent 5.9% 3.8% 73.1% --

TABLE E-2 (continued)

MINNESOTAMINNESOTA

Sources: MN Workforce Center, Maxfield Research Inc.

ANNUAL AVERAGE RESIDENT EMPLOYMENTWABASHA COUNTY, ROCHESTER MSA, & MINNESOTA

2000 to 2013

EMPLOYMENT TRENDS


• Wabasha County’s unemployment rate has been at or below the unemployment rate in the State of Minnesota in every year from 2000 to 2013. As of 2013, the County’s unemploy-ment rate was 4.6% compared to 5.1% in the State. Over the same interval, the Rochester MSA had unemployment rates slightly better than Wabasha County, estimated at 4.3% in 2013.

• The unemployment rate in Wabasha County reached a record peak in 2009 at 7.8% but has

since improved each year to arrive at 4.6% in 2013. Covered Employment by Industry • The Manufacturing sector accounted for 25.4% of the County’s jobs in 2013, which is the

greatest percentage by sector in the County. Trade, Transportation, & Utilities (TTU) and Education and Health Services sector accounted for 20.3% and 19.3% of the all jobs in Wa-basha County, respectively.

• Between 2000 and 2013, the total number of jobs decreased by 448 (-6.1%). Numerically,

the most jobs were lost in Manufacturing (487 jobs, -21.8%) followed by Construction (144 jobs, -37.3%).

• Job growth occurred in Natural Resources & Mining with the addition of 168 jobs,

(+117.5%). Additionally, notable growth occurred in the Leisure and Hospitality (106 jobs, +15.7) and Public Administration (72 jobs, +17.8%) sectors.

Industry 2000 2005 2010 2013 No. Pct. 2000 2005 2010 2013 2014

Natural Resources & Mining 143 153 273 311 168 117.5 1.9% 2.1% 4.1% 4.5% $489Construction 386 454 256 242 -144 -37.3 5.3% 6.3% 3.8% 3.5% $686Manufacturing 2,237 2,101 1,634 1,750 -487 -21.8 30.5% 29.3% 24.6% 25.4% $886Trade, Transportation, and Util ities 1,390 na 1,347 1,399 9 0.6 18.9% na 20.2% 20.3% $611Information 79 80 66 61 -18 -22.8 1.1% 1.1% 1.0% 0.9% $1,026Financial Services 198 212 214 201 3 1.5 2.7% 3.0% 3.2% 2.9% $881Professional and Business Services 138 124 128 170 32 23.2 1.9% 1.7% 1.9% 2.5% $493Education and Health Services 1,456 1,350 1,365 1,328 -128 -8.8 19.8% 18.8% 20.5% 19.3% $611Leisure and Hospitality 674 675 654 780 106 15.7 9.2% 9.4% 9.8% 11.3% $198Other Services 239 175 192 178 -61 -25.5 3.3% 2.4% 2.9% 2.6% $286Public Administration 404 na 525 476 72 17.8 5.5% na 7.9% 6.9% $662

Totals 7,344 7,166 6,654 6,896 -448 -6.1 $636

1 Avereage weekly wage by industry based on 1 Qtr 2014 data.

Source: Minnesota Workforce Center; Maxfield Research Inc.

TABLE E-3COVERED EMPLOYMENT TRENDS

WABASHA COUNTY2000, 2005, 2010-2013

North American Industrial Classification System (NAICS)Weekly wage1Average Number of Employees 2000 - 2013 % of Total

Change

EMPLOYMENT TRENDS


Average Weekly Wages by Industry • Average weekly wage data by industry is also presented in the table based on information

available in the most recently reported quarter: 1st Quarter 2014. Average weekly salary da-ta ranges from $198 per week (approximately $10,300 annually) for the Leisure and Hospi-tality industry to $1,026 per week (approximately $53,400 annually) for the Information In-dustry.

• It is important to note that although several industries have low wages, some of these posi-tions represent part-time jobs with hourly wages or may be in industries such as Leisure and Hospitality that have income sources (i.e. tips and gratuities) not accounted for in the data.

Commuting Patterns Proximity to employment is often a primary consideration when choosing where to live, since transportation costs often accounts for a large proportion of households’ budgets. Tables E-4 and E-5 highlight the commuting patterns of workers in Plainview and Wabasha County, respec-tively, in 2011 (the most recent data available), based on Employer-Household Dynamics data from the U.S. Census Bureau.

Place of Residence Count Share Place of Employment Count Share

Plainview city, MN 488 37.9% Rochester city, MN 593 36.8%Rochester city, MN 112 8.7% Plainview city, MN 488 30.3%Elgin city, MN 54 4.2% Winona city, MN 42 2.6%Kellogg city, MN 20 1.6% Wabasha city, MN 32 2.0%Lake City city, MN 20 1.6% Elgin city, MN 25 1.6%Eyota city, MN 19 1.5% Lake City city, MN 23 1.4%Chatfield city, MN 17 1.3% St. Charles city, MN 15 0.9%St. Charles city, MN 16 1.2% Spring Valley city, MN 14 0.9%Millvil le city, MN 9 0.7% Chatfield city, MN 11 0.7%Rushford city, MN 9 0.7% Goodview city, MN 11 0.7%All Other Locations 524 40.7% All Other Locations 356 22.1%

Total Primary Jobs 1,288 100.0% Total Primary Jobs 1,610 100.0%

Home Destination = Where workers l ive who are employed in the selection areaWork Destination = Where workers are employed who live in the selection area

Sources: U.S. Census Bureau Local Employment Dynamics; Maxfield Research, Inc.

TABLE E-4COMMUTING PATTERNS

CITY OF PLAINVIEW2011

Home Destination Work Destination

EMPLOYMENT TRENDS


Place of Residence Count Share Place of Employment Count Share

Lake City city, MN 845 13.9% Rochester city, MN 2,760 27.3%Plainview city, MN 668 11.0% Lake City city, MN 1,519 15.0%Wabasha city, MN 592 9.8% Wabasha city, MN 988 9.8%Rochester city, MN 279 4.6% Plainview city, MN 855 8.4%Elgin city, MN 143 2.4% Winona city, MN 376 3.7%Red Wing city, MN 112 1.8% Red Wing city, MN 336 3.3%Kellogg city, MN 86 1.4% Marshall city, MN 106 1.0%Winona city, MN 80 1.3% Elgin city, MN 95 0.9%Mazeppa city, MN 57 0.9% La Crosse city, WI 84 0.8%Alma city, WI 54 0.9% Zumbrota city, MN 79 0.8%All Other Locations 3,147 51.9% All Other Locations 2,926 28.9%

Total Primary Jobs 6,063 100.0% Total Primary Jobs 10,124 100.0%

Home Destination = Where workers l ive who are employed in the selection areaWork Destination = Where workers are employed who live in the selection area

Sources: U.S. Census Bureau Local Employment Dynamics; Maxfield Research, Inc.

TABLE E-5COMMUTING PATTERNS

WABASHA COUNTY2011

Home Destination Work Destination

• Of the workers employed in Plainview, approximately 37.9% also live in Plainview. The re-

maining workers are commuting from a large variety of cities including Rochester (8.7%), El-gin (4.2%) and other communities (1.6% or lower per community).

• Approximately 30% of Plainview residents also work in Plainview, which is second in per-

centage to those who commute to work in Rochester (36.8%). Other areas to which Plainview residents commute include Winona (2.6%) and Wabasha (2.0%) as well as other cities at small percentages.

• A large number of Wabasha County residents work in Rochester (27.3%) or Lake City (15.0%). Among all Wabasha County residents, 8.4% work in Plainview.

Inflow/Outflow Table E-6 provides a summary of the inflow and outflow of workers in Plainview and Wabasha County. Outflow reflects the number of workers living in Plainview but employed outside of Plainview while inflow measures the number of workers who are employed in Plainview but live outside. Interior flow reflects the number of workers that both live and work in Plainview. • Plainview is considered to be an exporter of workers, as the number of residents coming in-

to Plainview (inflow) for employment was less than the number of residents leaving

EMPLOYMENT TRENDS


Plainview for work (outflow). Approximately 800 workers came into Plainview for work while 1,122 workers left, for a net outflow of -322 workers.

• Similarly, Wabasha County is also an exporter of workers with a net outflow of -4,061 work-ers based on an inflow of 2,476 and outflow of 6,537 workers.

Num. Pct.

Employed in the Selection Area 1,288 100%Employed in the Selection Area but Living Outside 800 62.1%Employed and Living in the Selection Area 488 37.9%

Living in the Selection Area 1,610 100%Living in the Selection Area but Employed Outside 1,122 69.7%Living and Employed in the Selection Area 488 30.3%

Num. Pct.

Employed in the Selection Area 6,063 100%Employed in the Selection Area but Living Outside 2,476 40.8%Employed and Living in the Selection Area 3,587 59.2%

Living in the Selection Area 10,124 100%Living in the Selection Area but Employed Outside 6,537 64.6%Living and Employed in the Selection Area 3,587 35.4%

Sources: Longitudinal Employer-Household Dynamics; Maxfield Research Inc.

TABLE E-6

2011

Plainview

Wabasha County

CITY OF PLAINVIEW AND WABASHA COUNTYCOMMUTING INFLOW/OUTFLOW

EMPLOYMENT TRENDS


Plainview Inflow/Outflow

Wabasha County Inflow/Outflow

EMPLOYMENT TRENDS


Existing Business Mix The Quarterly Census of Employment is a census on employment. All establishments covered under the Unemployment Insurance Program are required to report employment statistics quarterly to the Minnesota Department of Employment and Economic Development. The Un-employment Insurance Program covers about 97% of Minnesota employment. Workers and jobs excluded from these statistics include self-employed, railroad workers, family farm work-ers, full-time students working for their school, etc. Table E-7 summarizes this data as compiled by DEED. Information is presented for the City of Plainview and Wabasha County. • There are approximately 108 establishments with 1,305 employees in the City of Plainview.

This accounts for approximately 19% and 18% of the employee and establishment base in Wabasha County respectively.

Business/Industry Number Pct Number Pct Number Pct Number Pct

Manufacturing 360 27.6% 5 4.6% 1,750 25.4% 33 5.4%Trade, Transportation, Utilities 208 15.9% 35 32.4% 1,399 20.3% 157 25.8%Financial Activities 77 5.9% 6 5.6% 201 2.9% 36 5.9%Professional and Business Services 46 3.5% 10 9.3% 170 2.5% 46 7.6%Education and Health Services 341 26.1% 13 12.0% 1,330 19.3% 55 9.0%Leisure and Hospitality 88 6.7% 9 8.3% 779 11.3% 80 13.2%Public Administration 57 4.4% 2 1.9% 476 6.9% 24 3.9%Total 1,305 108 6,896 608

Sources: DEED, Maxfield Research Inc.

Employment Establishments Employment Establishments

TABLE E-7BUSINESS MIX

CITY OF PLAINVIEW & WABASHA COUNTY2013

CITY OF PLAINVIEW WABASHA COUNTY

• Although Trade, Transportation, and Utilities had the largest number of establishments in

Plainview (35), the number of employees is third largest with 208, behind the Manufactur-ing industry (360) and Education and Health Services (341). Manufacturing is also the larg-est industry in Wabasha County with 1,750 employees and 33 establishments.

• There are approximately 608 establishments with 6,896 employees in Wabasha County.

EMPLOYMENT TRENDS


Major Employers Table E-8 shows the major employers in Plainview based on 2014 data provided by the City of Plainview. Employment totals include full-time and part-time employees combined and do not include seasonal or on-call employees. As illustrated in the table, the top 12 Plainview employ-ers are estimated to account for 885 employees; or about two-thirds of the employment in Plainview.

Name City Industry/Product/Service Total Employees*

Lakeside Foods Inc1 Plainview Food Processor 180

Plainview-Elgin-Millville Schools Plainview Education 150

Kreofsky Building Supply Plainview Equipment 100

St. Isadore's Health Center of Greenwood Prairie Plainview Healthcare 93

Plainview Milk Products Plainview Food Processor 81

Bennetts Food Center Plainview Grocery 65

Haley Comfort Systems Plainview Technology 57

Peoples State Bank Plainview Financial Services 46

Foresight Bank Plainview Financial Services 30

High Plains Cooperative Plainview Agriculture 30

Dairyland Equipment Plainview Equipment 28

SEMA Equipment Plainview Equipment 25

Total 885

Source: City of Plainview; Maxfield Research Inc.

TABLE E-8MAJOR EMPLOYERSCITY OF PLAINVIEW

2014

CITY OF PLAINVIEW

*Total Employees totals include full-time and part-time employees combined. Total does not include seasonal or on-call employees.

1 Total employees for Lakeside Foods does not include seasonal workers. An estimated 250 to 300 seasonal workers are employed between the spring and fall months.

EMPLOYMENT TRENDS


Employer Survey Maxfield Research surveyed representatives of the largest employers in Plainview during Janu-ary 2015. The questions covered topics such as recent trends in job growth, average wages and salaries, employee turnover, projected job growth. In addition, representatives were asked their opinion about issues related to housing in the area. Specifically, they were asked whether the current supply of housing in the area matches the needs of their workforce. The following points summarize the findings of this survey process. • Employers could not identify a central location that most of their employees commute to

their workplace, but believe most employees commute between 5 to 15 miles to their work destination.

• Hiring is expected to remain steady or increase over the next two to five years as service needs and business conditions dictate.

• There was a general consensus that most employees in the area currently own their homes,

but many new employees relocating to area from other areas tend to rent at first.

• Several employers did not express any concern regarding the for-sale or rental market in the Plainview area. Many believe rental and ownership options are adequate throughout the city.

HOUSING CHARACTERISTICS


Introduction The variety and condition of the housing stock in a community provides the basis for an attrac-tive living environment. Housing functions as a building block for neighborhoods and goods and services. We examined the housing market in Plainview and the Market Area by reviewing residential building trends, reviewing data on the age of the existing housing supply, and exam-ining data from the American Community Survey in the Plainview Market Area. Residential Construction Trends Maxfield Research obtained data from the U.S. Census Bureau on the number and housing costs of building permits issued for new housing units from 2000 to 2013. Tables HC-1 and HC-2 display permits issued for single-family and multifamily dwellings in Plainview and Wabasha County, respectively. Multifamily units include both for-sale (condominium, twinhomes, and townhomes) and rental projects. The following are key points about housing development since 2000. • The City of Plainview issued permits for the construction of 208 new residential units from

2000 to 2013, approximately 15 units annually. Over the same interval, Wabasha County is-sued 1,653 permits or 118 units annually.

• In the early part of the decade before the start of the Recession, there was more robust

permit activity than the later part. Comparatively, an annual average of 21 units were per-mitted annually in Plainview from 2000 through 2007 following which only 5 units were permitted annually through 2013.

• Greater than 90% of all building permits were for single-family homes in Plainview com-

pared to about 83.3% in Wabasha County.

• Among single-family homes, the 14-year average cost per unit is estimated at $161,661 in Plainview and $176,093 in Wabasha County.



2000 13 0 0 0 13 $1,743,000 $0 $0 $0 $1,743,0002001 20 0 0 0 20 $2,156,500 $0 $0 $0 $2,156,5002002 19 0 0 0 19 $1,887,300 $0 $0 $0 $1,887,3002003 32 0 0 0 32 $4,401,900 $0 $0 $0 $4,401,9002004 32 0 4 16 52 $4,703,000 $0 $353,200 $1,376,780 $6,432,9802005 19 0 0 0 19 $2,649,000 $0 $0 $0 $2,649,0002006 11 0 0 0 11 $1,892,000 $0 $0 $0 $1,892,0002007 15 0 0 0 15 $2,242,500 $0 $0 $0 $2,242,5002008 10 0 0 0 10 $1,818,500 $0 $0 $0 $1,818,5002009 6 0 0 0 6 $1,400,500 $0 $0 $0 $1,400,5002010 5 0 0 0 5 $964,500 $0 $0 $0 $964,5002011 0 0 0 0 0 $0 $0 $0 $0 $02012 4 0 0 0 4 $781,000 $0 $0 $0 $781,0002013 2 0 0 0 2 $423,000 $0 $0 $0 $423,000Total 188 0 4 16 208 $27,062,700 $0 $353,200 $1,376,780 $28,792,680

Avg. 13 0 0 1 15 $1,933,050 $0 $25,229 $98,341 $2,056,620

2000 $134,077 -- -- --

2001 $107,825 -- -- --

2002 $99,332 -- -- --

2003 $137,559 -- -- --

2004 $146,969 -- $88,300 $86,049

2005 $139,421 -- -- --

2006 $172,000 -- -- --2007 $149,500 -- -- --2008 $181,850 -- -- --2009 $233,417 -- -- --2010 $192,900 -- -- --2011 -- -- -- --2012 $195,250 -- -- --2013 $211,500 -- -- --Total $2,101,599 -- -- --

Avg. $161,661 -- $88,300 $86,049

Sources : U.S. Census ; Maxfield Research Inc.

2000 to 2013

TABLE HC-1RESIDENTIAL CONSTRUCTION/ANNUAL BUILDING PERMITS ISSUED

CITY OF PLAINVIEW

TOTAL UNITS TOTAL COST (in $)

COST PER UNIT

Single-Family Homes 3 & 4 Unit

Multi- family (5+

units)

Total Housing Permits

Single-Family Homes Twin/Town

Home 3 & 4 Unit

Multi- family (5+ units)

Total Housing UnitsTwin/Town

Home

0

10

20

30

40

50

60

Units

Year

New Construction (Units)City of Plainview, 2000-2013

Multifamily

Single-family



2000 119 2 0 0 121 $15,249,084 $152,000 $0 $0 $15,401,0842001 143 6 8 10 167 $13,981,000 $453,500 $420,500 $379,500 $15,234,5002002 166 8 0 44 218 $17,373,800 $400,000 $0 $7,400,000 $25,173,8002003 193 4 4 48 249 $25,644,963 $398,000 $106,000 $8,072,727 $34,221,6902004 197 6 4 16 223 $30,368,900 $686,000 $353,220 $1,476,780 $32,884,9002005 123 8 0 91 222 $21,596,250 $953,000 $0 $12,637,000 $35,186,2502006 103 2 3 12 120 $18,016,500 $253,000 $693,000 $1,591,000 $20,553,5002007 74 0 0 0 74 $13,869,500 $0 $0 $0 $13,869,5002008 54 0 0 0 54 $10,902,500 $0 $0 $0 $10,902,5002009 43 0 0 0 43 $8,581,000 $0 $0 $0 $8,581,0002010 40 0 0 0 40 $8,578,000 $0 $0 $0 $8,578,0002011 29 0 0 0 29 $6,411,191 $0 $0 $0 $6,411,1912012 45 0 0 0 45 $10,119,000 $0 $0 $0 $10,119,0002013 48 0 0 0 48 $11,900,500 $0 $0 $0 $11,900,500Total 1,377 36 19 221 1,653 $212,592,188 $3,295,500 $1,572,720 $31,557,007 $249,017,415

Avg. 98 3 1 16 118 $11,900,500 $235,393 $112,337 $2,254,072 $17,786,958

2000 $128,144 $76,000 -- --

2001 $97,769 $75,583 $52,563 $37,950

2002 $104,661 $50,000 -- $168,182

2003 $132,875 $99,500 $26,500 $168,182

2004 $154,157 $114,333 $88,305 $92,299

2005 $175,579 $119,125 -- $138,868

2006 $174,917 $126,500 $231,000 $132,583

2007 $187,426 -- -- --

2008 $201,898 -- -- --

2009 $199,558 -- -- --

2010 $214,450 -- -- --

2011 $221,076 -- -- --

2012 $224,867 -- -- --

2013 $247,927 -- -- --

Total $2,465,305 $91,542 $82,774.74 $142,792

Avg. $176,093 $94,435 $99,592 $123,011

Sources : U.S. Census ; Maxfield Research Inc.

TABLE HC-2RESIDENTIAL CONSTRUCTION/ANNUAL BUILDING PERMITS ISSUED

WABASHA COUNTY2000 to 2013

Single-Family H

Twin/Town Home 3 & 4 Unit

Multi- family (5+

i )

Total Housing P i

Single-Family Homes

COST PER UNIT

Twin/Town Home 3 & 4 Unit

Multi- family (5+ units)

Total Housing Units

TOTAL UNITS TOTAL COST (in $)

0

50

100

150

200

250

300

Units

Year

New Construction (Units)Wabasha County, 2000-2013

Multifamily

Single-family



American Community Survey The American Community Survey (“ACS”) is an ongoing statistical survey administered by the U.S. Census Bureau that is sent to approximately 3 million addresses annually. The survey gathers data previously contained only in the long form of the decennial census. As a result, the survey is ongoing and provides a more “up-to-date” portrait of demographic, economic, so-cial, and household characteristics every year, not just every ten years. The most recent ACS highlights data collected between 2008 and 2012. Tables HC-3 to HC-7 show key data for Plainview and the Market Area. Age of Housing Stock The following graph shows the age distribution of the housing stock in 2012 based on data from the U.S. Census Bureau and 2012 from the American Community Survey (5-Year). Table HC-3 includes the number of housing units built in Plainview and the Market Area, prior to 1940 and during each decade since. • In total, the Market Area is estimated to have 2,902 housing units, of which 1,265 units

(43.6%) are located in the City of Plainview.



Total Med. Yr.Units Built No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

Owner-Occupied 1,002 1970 237 23.7 65 6.5 97 9.7 103 10.3 116 11.6 60 6.0 166 16.6 158 15.8 0 0.0Renter-Occupied 263 1969 83 31.6 0 0.0 12 4.6 39 14.8 23 8.7 55 20.9 28 10.6 23 8.7 0 0.0Total 1,265 1970 320 25.3 65 5.1 109 8.6 142 11.2 139 11.0 115 9.1 194 15.3 181 14.3 0 0.0




AGE OF HOUSING STOCKTABLE HC-3

2010s

Year Unit Built

CITY OF PLAINVIEW

2012

1980s<1940 1940s 1990s

MARKET AREA TOTAL

PLAINVIEW MARKET AREA

1950s 1960s 2000s1970s

REMAINDER OF MARKET AREA



• The overall median year built for a home in Plainview is 1970, on par with 1969 in the Mar-ket Area overall. Median year built for renter-occupied housing was notably older than for owner-occupied housing in the Market Area (1961 versus 1973) but relatively similar in Plainview (1969 versus 1970).

• By numerical supply, the greatest numbers of homes in Plainview (320 homes, or 25.3%) and the Market Area (865 homes, or 29.8%) were built prior to 1940. It is possible that some of these housing units may be dilapidated and in need of replacement of repair.

Housing Units by Structure and Occupancy or (Housing Stock by Structure Type) Table HC-4 shows the housing stock in Plainview and the Market Area by type of structure and tenure as of 2012. • The dominant housing type in the Market Area is the single-family detached home, repre-

senting an estimated 89.0% of all owner-occupied housing units and 44.5% of renter-occupied housing units as of 2012.

• Most of the housing units with three or more units are renter-occupied. About two-thirds

of the Market Area’s renter-occupied housing units with three or more units are located in the City of Plainview.

• Mobile homes account for about 10.4% of all housing units in the Market Area.

Owner- Renter- Owner- Renter- Owner- Renter-Units in Structure Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct. Occupied Pct.

1, detached 818 81.6% 54 20.5% 1,278 94.4% 189 67% 2,096 89.0% 243 44.5%1, attached 68 6.8% 19 7.2% 15 1.1% 7 2% 83 3.5% 26 4.8%2 51 5.1% 29 11.0% 3 0.2% 8 3% 54 2.3% 37 6.8%3 to 4 0 0.0% 0 0.0% 0 0.0% 14 5% 0 0.0% 14 2.6%5 to 9 0 0.0% 26 9.9% 1 0.1% 30 11% 1 0.0% 56 10.3%10 to 19 0 0.0% 20 7.6% 0 0.0% 19 7% 0 0.0% 39 7.1%20 to 49 0 0.0% 66 25.1% 0 0.0% 0 0% 0 0.0% 66 12.1%50 or more 0 0.0% 8 3.0% 0 0.0% 0 0% 0 0.0% 8 1.5%Mobile home 65 6.5% 41 15.6% 57 4.2% 16 6% 122 5.2% 57 10.4%Boat, RV, van, etc. 0 0.0% 0 0.0% 0 0.0% 0 0% 0 0.0% 0 0.0%Total 1,002 100% 263 100% 1,354 100% 283 100% 2,356 100% 546 100%


PLAINVIEW MARKET AREA TOTALREMAINDER

TABLE HC-4HOUSING UNITS BY STRUCTURE & TENURE




Owner-Occupied Housing Units by Mortgage Status Table HC-5 shows mortgage status and average values from the American Community Survey for 2012 (5-Year). Mortgage status provides information on the cost of homeownership when analyzed in conjunction with mortgage payment data. A mortgage refers to all forms of debt where the property is pledged as security for repayment of debt. A first mortgage has priority claim over any other mortgage; these may also be a household’s only mortgage. A second (and sometimes third) mortgage is called a “junior mortgage,” a home equity line of credit (HELOC) would also fall into this category. Finally, a housing unit without a mortgage is owned free and clear and is debt free. • Approximately 71% of Market Area homeowners have a mortgage. About 15.6% of home-

owners with mortgages in Plainview also have a second mortgage and/or home equity loan.

• Homes with a mortgage have higher median values than homes without a mortgage in all assessed geographies. The median value for homes with a mortgage in the City of Plainview is approximately $130,600 compared to $112,700 for a home without a mortgage.

• Median home values are greater in the Remainder of Market Area than in Plainview. By

comparison, housing units with a mortgage have a median value of $130,600 in Plainview compared to $205,759 in the Remainder and $173,689 overall.



Mortgage Status No. Pct. No. Pct. Pct. Pct.

Housing units without a mortgage 286 28.5 392 29.0 678 28.8Housing units with a mortgage/debt 716 71.5 962 71.0 1,678 71.2

Second mortgage only 41 4.1 94 6.9 135 5.7Home equity loan only 63 6.3 155 11.4 218 9.3Both second mortgage and equity loan 0 0.0 15 1.1 15 0.6No second mortgage or equity loan 612 61.1 698 51.6 1,310 55.6

Total 1,002 100.0 1,354 100.0 2,356 100.0

Median Value by Mortgage StatusHousing units with a mortgageHousing units without a mortgage


$112,700 $213,125 $170,763

PLAINVIEW REMAINDER MARKET AREA

$130,600 $205,759 $173,689

TABLE HC-5OWNER-OCCUPIED HOUSING UNITS BY MORTGAGE STATUS


Owner-Occupied Housing Units by Value Table HC-6 presents data on housing values summarized by nine price ranges. Housing value refers to the estimated price point the property would sell if the property were for sale. For single-family and townhome properties, value includes both the land and the structure. For condominium units, value refers to only the unit. • The majority of the owner-occupied housing stock in the City of Plainview is estimated to be

valued between $100,000 and $199,999 (61.0%). • The median home value in Plainview is $126,100, which is $83,580 less than the median

home value in the Remainder of the Market Area ($209,680). This upward shift of median home values is due to greater percentages of homes above $300,000 in the Remainder of the Market Area compared to Plainview. Less than 2% of homes in Plainview are valued at $300,000 or greater compared to 24% in the Remainder of the Market Area. A percentage of these in the Remainder of the Market Area are located on acreages or farmsteads, in-creasing their value and estimated price point considerably.



Home Value No. Pct. No. Pct. No. Pct.

Less than $50,000 91 9.1 50 3.7 141 6.0$50,000-$99,999 217 21.7 120 8.9 337 14.3$100,000-$149,999 367 36.6 224 16.5 591 25.1$150,000-$199,999 244 24.4 324 23.9 568 24.1$200,000-$249,999 43 4.3 189 14.0 232 9.8$250,000-$299,999 27 2.7 122 9.0 149 6.3$300,000-$399,999 8 0.8 156 11.5 164 7.0$400,000-$499,999 5 0.5 33 2.4 38 1.6Greater than $500,000 0 0.0 136 10.0 136 5.8Total 1,002 100.0 1,354 100.0 2,356 100.0

Median Home Value


TABLE HC-6OWNER-OCCUPIED UNITS BY VALUE


$126,100 $174,135$209,680

MARKET AREAREMAINDERPLAINVIEW



Renter-Occupied Units by Contract Rent Table HC-7 presents information on the monthly housing costs for renters called contract rent (also known as asking rent). Contract rent is the monthly rent agreed to without consideration for any utilities, furnishings, fees, or services that may be included. • The median contract rent in Plainview and the Remainder of the Market Area was $461 and

$483, respectively. Based on a 30% allocation of income to housing, a household in Plainview would need an income of about $18,440 to afford an average monthly rent of $461 and an income of $19,320 in the Remainder of the Market Area to afford an average monthly rent of $483.

• Nearly half of Plainview renters paying cash have monthly rents ranging from $250 to $499. Just over 8% of renters have monthly rents of $1,000 or greater, which likely includes single-family homes converted into rental properties.

• Housing units without payment of rent (“no cash rent”) make up only 2.7% of Plainview renters. There are typically units owned by a relative or friend who lives elsewhere and al-low occupancy without charge. Other sources may include caretakers or ministers who may occupy a housing unit without rent charge as indirect compensation.

Contract Rent No. Pct. No. Pct. No. Pct.

No Cash Rent 7 2.7 62 21.9 69 12.6Cash Rent 256 97.3 221 78.1 477 87.4

$0 to $249 37 14.1 2 0.7 39 7.1$250-$499 131 49.8 130 45.9 261 47.8$500-$749 66 25.1 71 25.1 137 25.1$750-$999 0 0.0 7 2.5 7 1.3$1,000+ 22 8.4 11 3.9 33 6.0

Total 263 100.0 283 100.0 546 100.0

Median Contract Rent


TABLE HC-7RENTER-OCCUPIED UNITS BY CONTRACT RENT


$461 $471$483

MARKET AREAREMAINDERPLAINVIEW

RENTAL MARKET ANALYSIS


Introduction Maxfield Research Inc. identified and surveyed larger rental properties of 6 or more units in Plainview. In addition, interviews were conducted with real estate agents, developers, rental housing management firms, and others in the community familiar with Plainview’s rental hous-ing stock. For purposes of our analysis, we have classified rental projects into two groups, general occu-pancy and senior (age restricted). All senior projects are included in the Senior Rental Analysis section of this report. The general occupancy rental projects are divided into three groups, market rate (those without income restrictions), affordable, (those receiving tax credits in order to keep rents affordable), and subsidized (those with income restrictions based on 30% alloca-tion of income to housing). Overview of Rental Market Conditions Maxfield Research utilized data from the American Community Survey (ACS) to summarize rental market conditions in the Plainview Market Area. The ACS is an ongoing survey conduct-ed by the United States Census Bureau that provides data every year rather than every ten years as presented by the decennial census. We use this data because these figures are not available from the decennial census. Please note that the ACS data includes all rental units, re-gardless of household type. Table R-1 on the following page presents a breakdown of median gross rent and monthly gross rent ranges by number of bedrooms in renter-occupied housing units from the 2008-2012 ACS in the Plainview Market Area, in comparison to Minnesota. Gross rent is defined as the amount of the contract rent plus the estimated average monthly cost of utilities (electricity, gas, and water and sewer) and fuels (oil, coal, wood, etc.) if these are paid by the renter. • Because of the difference in methodology between the decennial census and the ACS, there

are slight differences in the total number of renter-occupied units presented between the two surveys. Census data indicates that there were 517 renter-occupied housing units in the Plainview Market Area in 2010 while the ACS shows 546 renter-occupied housing units.

• The Plainview Market Area has relatively affordable rents when compared to Minnesota.

The median gross rent in the area is at $652 which is 23% lower than the median rent of $802 in Minnesota. Rural communities often have lower rents than metropolitan areas due to wage rates and the age of rental properties in rural areas.



MN

#% of Total

#% of Total

#% of Total

% ofTotal

Total: 263 100% 283 100% 546 100% 100%

Median Gross Rent $802

No Bedroom 25 10% 0 0% 25 5% 4%Less than $200 0 0% 0 0% 0 0% 4%$200 to $299 0 0% 0 0% 0 0% 0%$300 to $499 25 10% 0 0% 25 5% 0%$500 to $749 0 0% 0 0% 0 0% 1%$750 to $999 0 0% 0 0% 0 0% 2%$1,000 or more 0 0% 0 0% 0 0% 0%No cash rent 0 0% 0 0% 0 0% 0%

1 Bedroom 75 29% 19 7% 94 17% 34%Less than $200 7 3% 0 0% 7 1% 34%$200 to $299 16 6% 0 0% 16 3% 1%$300 to $499 18 7% 5 2% 23 4% 3%$500 to $749 26 10% 12 4% 38 7% 5%$750 to $999 0 0% 0 0% 0 0% 11%$1,000 or more 8 3% 0 0% 8 1% 9%No cash rent 0 0% 2 1% 2 0% 4%

2 Bedrooms 75 29% 101 36% 176 32% 38%Less than $200 15 6% 0 0% 15 3% 36%$200 to $299 5 2% 0 0% 5 1% 1%$300 to $499 0 0% 26 9% 26 5% 1%$500 to $749 49 19% 56 20% 105 19% 2%$750 to $999 0 0% 9 3% 9 2% 8%$1,000 or more 6 2% 0 0% 6 1% 12%No cash rent 0 0% 10 4% 10 2% 12%

3 or More Bedrooms 88 33% 163 58% 251 46% 24%Less than $200 0 0% 0 0% 0 0% 21%$200 to $299 0 0% 2 1% 2 0% 0%$300 to $499 7 3% 6 2% 13 2% 0%$500 to $749 6 2% 32 11% 38 7% 1%$750 to $999 44 17% 34 12% 78 14% 3%$1,000 or more 24 9% 39 14% 63 12% 4%No cash rent 7 3% 50 18% 57 10% 12%

Sources: 2008-2012 American Community Survey; Maxfield Research, Inc.

$652$700$600

TABLE R-1

PRIMARY MARKET AREA2012

Plainview Remainder Market Area

BEDROOMS BY GROSS RENT, RENTER-OCCUPIED HOUSING UNITS



• Three- bedroom or more units are the most common rental unit type in the Market Ar-ea, representing 46% of all occupied rental units in the Market Area. Most of the three-bedroom or more units in the Market Area are located in single-family rentals. In Min-nesota, two-bedroom units are also the most common rental unit type (38%).

10%0% 5%

4%

29%

7%17%

34%

29%

36%

32%

38%

33%

58%46%

24%

0%10%20%30%40%50%60%70%80%90%

100%

Plainview Remainder Market Area MN

Renter-Occupied Housing UnitsBy Number of Bedrooms

3BR+

2BR

1BR

No BR

• One-bedroom units comprise 17% of the Market Area’s renter-occupied housing supply and

units while only 5% of the renter-occupied units have no bedrooms. By comparison, rough-ly 34% of Minnesota’s renter-occupied housing units are one-bedroom and 4% have no bedrooms.

• Nearly 19% of the two-bedroom units in the Market Area have gross monthly rents ranging

from $500 to $749, and 5% have a rental rate range of $300 to $499. Units with rents from $750 to $999 represent roughly 2% of the two-bedroom units in the Market Area.

• Roughly 15% of the units with three or more bedrooms in the Market Area rent for $500 to

$749, and 31% have a rental rate range of $750 to $999. Units with rents $1,000 or more account for 25% of the three or more bedroom units in the Market Area.



General-Occupancy Rental Projects Our research of Plainview’s general occupancy rental market included a survey of three market rate apartment properties (6 units and larger) and three affordable/subsidized communities in February 2015. These projects represent a combined total of 66 units, including 14 market rate units and 52 affordable/subsidized units. At the time of our survey, no affordable/subsidized units were vacant. The industry standard of 5% vacancy indicates a stabilized rental market, which promotes competitive rates, ensures ad-equate choice, and allows for unit turnover. However, Maxfield Research was unable to con-firm the market rate vacancy rates due to a lack of participation from the properties. Table R-2 summarized information on market rate projects, while Table R-3 summarizes infor-mation on subsidized/affordable projects. Market Rate

• Hanna Lou Properties (2 different locations) and Townhomes of Value were the only two

market rate properties identified. However, neither property was able to participate in the rental survey.

• Online resources show two-bedroom units at Hanna Lou Properties that range from $550 to

$600 per month. The property features a total of 14 units located within two separate buildings (8-unit and 6-unit).

• Maxfield Research recently completed the Olmsted County Comprehensive Housing Study

and found an overall vacancy rate 4.5% for market rate units and 1.2% for afforda-ble/subsidized units. Due to Plainview’s close proximity to Olmsted County and the Roches-ter area, Plainview has some potential to capture households seeking more affordable housing. The following summarizes average price per square foot and average rents for Olmsted County:

o Efficiency units: $1.22 | Avg. $555 o One-bedroom units: $1.14 | Avg. $802 o Two-bedroom units: $0.94 | Avg. $963 o Three-bedroom units: $0.86 | Avg. $1,156 o Four-bedroom units: $1.19 | Avg. $1,536

• The average price per square foot monthly rent in Olmsted County was around $0.97.

However, we estimate that Plainview is around $0.65 per square foot; indicating rents over 30% lower than the Olmsted County average.



Date No. ofDevelopment/Location Opened Units Vacant CommentsHanna Lou Properties 1970s 14 n/a n/a - 2BR $550 - $600235 6th St NW/605 3rd Ave NWPlainview

Townhomes of Value n/a n/a n/a n/a - n/a Unable to reach.Plainview

Souce: Maxfield Research Inc.

TABLE R-2GENERAL OCCUPANCY RENTAL DEVELOPMENTS

February 2015PLAINVIEW MARKET AREA

Unit MixMonthly

Unit Size Rent/Feesn/a Did not wish to participate. 235 6th St

NE is an 8-plex 605 3rd Ave NW is an 6-plex.

n/a n/a



Date No. ofDevelopment/Location Opened Units Vacant Comments

Harvest Ridge Townhomes 2005 20 0 14 -2BR Section 42. Waiting List.713 Third Ave NE 6 -3BRPlainview

Nor-Plain Apartments 1981 8 0 8 -2BR Section 8. Waiting List.330 NE 1st StreetPlainview

Eastwood Apartments 1970s 24 0 n/a -1BR HUD.100 5th Ave NE n/a -2BRPlainview

Total 52 0


Based on Income

0.0%

Based on IncomeBased on Income

Based on IncomeBased on Income

TABLE R-3AFFORDABLE/SUBSIDIZED DEVELOPMENTS

PLAINVIEW MARKET AREAFebruary 2015

MonthlyUnit Mix Rent/Fees



Affordable/Subsidized • There are a total of three income-restricted projects in the Plainview Market Area with 52

total units. Combined, there are no vacancies amongst the surveyed properties. Typically, subsidized and affordable rental properties should be able to maintain vacancy rates of 3% or less in most housing markets. The low vacancy rates in the market indicate pent-up de-mand for affordable and subsidized units and also are an indication of the current economic climate in the area.

• Eastwood Apartments has a total of 24 units and is the largest income based develop-

ment in Plainview. One and two bedroom units are available and rent is based on in-come. One bedroom units range from $475 to $565 (1 to 2 person occupancy) and two bedroom units range from $510 to $605 (2 to 4 person occupancy). Minimum rent is required or 30% of adjusted income not to exceed maximum rent. Rent includes heat, water, sewer, and garbage. Electric allowance is $49 for one bedroom units and $48 for two bedroom units. HUD rental assistance vouchers accepted.

• Harvest Ridge Townhomes has a total of 20 units and is the second largest income based development in Plainview. Two and three bedroom units are available and rent is based on income. Rent ranges from $540 for two bedroom units and $610 for three bedroom units. Harvest Ridge Townhomes typically has a waiting list.

• Nor-Plain Apartments, has a total of 8 units. All units are two bedroom units. Rent is

based on 30% of income like Eastwood Apartments. Rent includes water, sewer, and garbage.

Select Income-Based Rental Housing Properties

Harvest Ridge Eastwood Apartments

SENIOR MARKET ANALYSIS


Senior Housing Defined The term “senior housing” refers to any housing development that is restricted to people age 55 or older. Today, senior housing includes an entire spectrum of housing alternatives, which occasionally overlap, thus making the differences somewhat ambiguous. However, the level of support services offered best distinguishes them. Maxfield Research Inc. classifies senior hous-ing projects into five categories based on the level of support services offered: Adult/Few Services; where few, if any, support services are provided, and rents tend to be modest as a result; Congregate/Optional-Services; where support services such as meals and light housekeeping are available for an additional fee; Congregate/Service-Intensive; where support services such as meals and light housekeeping are included in the monthly rents; Assisted Living; where two or three daily meals as well as basic support services such as trans-portation, housekeeping and/or linen changes are included in the fees. Personal care services such as assistance with bathing, grooming and dressing is included in the fees or is available ei-ther for an additional fee or included in the rents. Memory Care; where more rigorous and service-intensive personal care is required for people with dementia and Alzheimer’s disease. Typically, support services and meal plans are similar to those found at assisted living facilities, but the heightened levels of personalized care de-mand more staffing and higher rental fees. These five senior housing products tend to share several characteristics. First, they usually offer individual living apartments with living areas, bathrooms, and kitchens or kitchenettes. Second, they generally have an emergency response system with pull-cords or pendants to promote se-curity. Third, they often have a community room and other common space to encourage social-ization. Finally, they are age-restricted and offer conveniences desired by seniors, although as-sisted living projects sometimes serve non-elderly people with special health considerations. The five senior housing products offered today form a continuum of care (see Figure 2 on the following page), from a low level to a fairly intensive one; often the service offerings at one type overlap with those at another. In general, however, adult/few services projects tend to at-tract younger, more independent seniors, while assisted living and memory care projects tend to attract older, frailer seniors.

SENIOR MARKET ANALYSIS


Fully Independent

Senior Housing ProductsSource: Maxfield Research Inc.

CONTINUUM OF HOUSING AND SERVICES FOR SENIORS

Single-Family Home

Townhome or Apartment

Congregate Apartments w/ Optional Services

Assisted Living Nursing Facilities

Lifestyle Dependent on Care

Age-Restricted Independent Apartments, Townhomes, Condominiums, or

Cooperatives

Congregate Apartments w/ Intensive Services

Memory Care Units

Fully or Highly

Senior Housing in Plainview and the Market Area As of February 2015, Maxfield Research identified three senior housing developments in the Plainview Market Area. Combined, these projects contain a total of 76 units. One of the pro-jects are subsidized, while the remaining two are market rate. Tables S-1 and S-2 provide in-formation on the market rate and subsidized projects. Information in the table includes year built, number of units, unit mix, number of vacant units, rents, and general comments about each project. The following are key points from our survey of the senior housing supply. Affordable/Subsidized Senior Housing Projects • Subsidized senior housing offers affordable rents to qualified lower income seniors and

handicapped/disabled persons. Typically, rents are tied to residents’ incomes and based on 30 percent of adjusted gross income (AGI), or a rent that is below the fair market rent. For those households meeting the age and income qualifications, subsidized senior housing is usually the most affordable rental option available. Affordable projects are typically tax-credit projects that are limited to households earning less than 80% of Wabasha County’s area median income.

• Plainview Senior Housing has a total of 40 subsidized senior/or disabled senior units. As of February 2015, there was no vacancies, which indicates pent-up demand for subsidized sen-ior rental units.

• All the income-restricted units are one bedroom units. Typically units sizes at subsidize sen-ior projects are smaller than many of the market rate senior rental projects.

• Typically subsidized senior housing offers limited to no amenities. However, many of the

subsidized senior housing offered community rooms, dining rooms, and craft rooms.

SENIOR HOUSING ANALYSIS



Plainview Senior Housing 1980s 40 0 40 1BR905 2nd Ave NWPlainview

Total 40 0


Unit Mix

0.0%

Rent/Fees

TABLE S-1AFFORDABLE/SUBSIDIZED SENIOR HOUSING DEVELOPMENTS


Monthly

30% of Income




CongregateGreenwood Prairie Place 1993 18 0 private Waiting List.800 2nd Ave NW 1BR deluxePlainview 2BR

Assisted LivingGreenwood Prairie Place 1993 18 0 private $4,500 -$5,500 Waiting List.800 2nd Ave NWPlainview

Total 36 0


TABLE S-2SENIOR HOUSING DEVELOPMENTS

February 2015PLAINVIEW MARKET AREA

MonthlyUnit Mix Rent/Fees

$2,907$1,758$1,500



Select Senior Rental Housing Properties

Plainview Senior Housing (Income-Based) Green Prairie Place Congregate • There is one existing congregate senior project in the Plainview Market Area with a total of

18 units (Greenwood Prairie Place). As of February 2015, no vacancies were found. Gener-ally a healthy senior housing market will have a vacancy rate of around 5.0% in order to al-low for sufficient consumer choice and turnover.

• Greenwood Prairie Place indicated they are almost always at capacity and have a waiting

list.

• Rents ranged from $1,500 for one-bedroom units to $2,907 for two-bedroom units. Rent includes all utilities except telephone and cable. There are transportation options to down-town Plainview. Emergency call system, activities, two meals daily, housekeeping, stove, and refrigerator are some amenities and services available.

Assisted Living • There is one existing assisted living senior project in the Plainview Market Area with a total

of 18 units. As of February 2015, no vacancies were found. • Rents ranged from $4,500 to $5,500. Rent includes all utilities except telephone and cable.

There are transportation options to downtown Plainview. Emergency call system, activities, two meals daily, housekeeping, stove, and refrigerator are some amenities and services available.

• Rent ranges can vary depending on service and amenity package.

FOR-SALE HOUSING ANALYSIS


Introduction Maxfield Research Inc. analyzed the for-sale housing market in Plainview by analyzing data on single-family and multifamily home sales and active listings, identifying active subdivisions and pending for-sale developments; and conducting interviews with local real estate professionals, developers, builders, and planning officials. Overview of For-Sale Housing Market Conditions Table FS-1 presents home resale data on single-family and multifamily housing in Plainview from 2000 through 2015. The data was obtained from the Southeast Minnesota Association of Realtors (SEMAR) and shows annual number of sales, median and average pricing, cumulative days on market, square footage, and the price per square foot. It should be noted that cumula-tive days on market were not calculated until 2008. Because the market area expands into multiple counties, Table FS-2 presents macro-level hous-ing data trends for Wabasha and Olmsted County between 2005 and 2014. • Like across Minnesota and the nation, pricing peaked in 2006 at the height of the real estate

boom. The median and average sales price peaked at $142,382 and $146,410 respectively.

• Between 2000 and 2005, the median sales price increased from $97,000 to $142,382, a gain of +46.8%. However, from 2005 to 2009 the median sales price declined to $118,900 (-15.5%).

• The median sales price bottomed out during the Great Recession in 2009 at $118,900 and

has gradually increased to $137,000 in 2014. Between 2009 and 2014 the median sales price has increased +15.2%.

• Since 2000, there have been an average of 51 resales annually in Plainview. The number of

resales has ranged from 40 in 2013 to 70 in 2005.

• The median sales price per square foot (sales price divided by square footage) peaked this past year at $72 PSF. Since 2009 the median price per square foot has increased by 33%.

• Single-family housing types accounted for 96% of all resales since 2000 in Plainview. There

are very few maintenance-free housing types existing in Plainview’s housing stock.



43 4244

57

47

70

6065

53

4348 49 53

40

47

0

10

20

30

40

50

60

70

80

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

$200,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Resa

les

Sale

s Pr

ice

Year

Plainview Housing Resales - 2000 to 2014

Resales Median Sold Price Average Sold Price

$53 $51$56

$61 $60$63

$66$61 $61

$54$60

$53

$67$71 $72

$0

$10

$20

$30

$40

$50

$60

$70

$80

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

PSF

Year

Median Sales Price per Sq. Ft. (PSF) 2000-2014



No. Avg. Sales Avg. % Med. Sales Median %Year Sold Price Change Price Change Avg. Median Avg. Median Avg. Median

2000 43 $102,830 - $97,000 - 2,075 2,160 - - $51 $532001 42 $125,059 21.6% $117,750 21.4% 2,419 2,348 - - $52 $512002 44 $122,418 -2.1% $120,000 1.9% 2,253 2,101 - - $56 $562003 57 $139,855 14.2% $133,000 10.8% 2,421 2,352 - - $60 $612004 47 $132,569 -5.2% $125,000 -6.0% 2,287 2,250 - - $59 $602005 70 $146,410 10.4% $142,382 13.9% 2,313 2,316 - - $65 $632006 60 $142,960 -2.4% $140,000 -1.7% 2,218 2,124 - - $65 $662007 65 $137,658 -3.7% $140,950 0.7% 2,273 2,256 - - $63 $612008 53 $132,532 -3.7% $135,000 -4.2% 2,241 2,231 105 70 $60 $612009 43 $126,301 -4.7% $118,900 -11.9% 2,312 2,227 177 94 $55 $542010 48 $141,203 11.8% $133,500 12.3% 2,525 2,318 166 117 $58 $602011 49 $135,059 -4.4% $130,000 -2.6% 2,569 2,415 151 103 $52 $532012 53 $134,673 -0.3% $125,000 -3.8% 1,964 1,774 156 71 $71 $672013 40 $134,143 -0.4% $130,250 4.2% 2,012 1,874 98 52 $70 $712014 47 $137,629 2.6% $137,000 5.2% 2,055 1,889 91 76 $69 $72

Total 00'-14' 761

Summary 00' to 14'Change 33.8% 41.2%

Average 51 $133,850 $129,699 2,266 2,183 135 84 $61 $61

Sources: Southeast MN Association of Realtors, Maxfield Research Inc.

TABLE FS-1HOME RESALES

CITY OF PLAINVIEW2000 to 2014

Days on Market Price per Sq. Ft. (PSF)Total Sq. Ft.

FOR-SALE MARKET ANALYSIS


• During the real estate boom, the median sales price for Wabasha County and Olmsted County was nearly identical in 2005 at about $165,000. However, Olmsted County did not experience depreciation like most areas in Minnesota during the Great Recession. As a re-sult, the pricing gap between Wabasha County and Olmsted County has widened as Olmsted County’s median sales price plateaued this past year at $169,000.

Avg.No. Avg. Median Median Time on

Year Sold Sold Price Sold Price PSF Market1

Wabasha County2005 -- $200,729 $165,000 $83 --2006 -- $185,314 $160,348 $79 --2007 262 $169,226 $145,531 $70 --2008 332 $154,486 $139,500 $68 1452009 270 $139,159 $128,000 $61 1352010 296 $157,634 $139,900 $67 1742011 263 $145,137 $129,900 $63 1802012 270 $159,690 $138,800 $73 2022013 296 $158,915 $142,750 $78 1282014 279 $156,952 $139,000 $80 134

Pct. Change05 to 10 -21% -15% -19% --11 to 14 8% 7% 27% --05 to 14 -22% -16% -4% --

Olmsted County2005 -- $194,805 $166,000 $80 --2006 -- $207,709 $171,200 $81 --2007 3,135 $194,025 $163,000 $81 --2008 3,592 $193,298 $163,584 $80 1152009 3,498 $179,231 $153,000 $77 1132010 3,195 $177,975 $154,900 $75 1222011 2,552 $184,565 $152,900 $73 1702012 2,288 $183,129 $156,000 $79 1662013 2,485 $192,512 $165,125 $84 712014 2,349 $202,419 $169,000 $89 86

Pct. Change05 to 10 -9% -7% -6% --11 to 14 10% 11% 22% --05 to 14 4% 2% 11% --

¹ Cummulative Days on the Market began in 2008

Sources: 10K Research; Maxfield Research Inc.

TABLE FS-2

2005 to 2014

HOME RESALE COMPARISONSWABASHA AND OLMSTED COUNTIES



$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Med

ian

Sale

s Pr

ice

Year

Wabasha Co. & Olmsted Co. Median Resale Values: 2005-2014

Wabasha Co. Olmsted Co.

Current Supply of Homes on the Market To more closely examine the current market for available owner-occupied housing in Plainview, we reviewed the current supply of homes on the market (listed for sale). Table FS-3 homes shows currently listed for sale in Plainview distributed into 14 price ranges. The data was pro-vided by the Regional Multiple Listing Services of Minnesota and is based on active listings in October 2014. MLS listings generally account for the vast majority of all residential sale listings in a given area. Table FS-4 shows listings by home style (i.e. one-story, two-story, etc.) and Ta-ble FS-5 shows listings by property type and pricing. • As of October 2014, there were 20 homes listed for sale in Plainview. There were no multi-

family properties listed for sale.

• The median list price in Plainview for a single-family home is $135,200. The median sale price is generally a more accurate indicator of housing values in a community than the aver-age sale price. Average sale prices can be easily skewed by a few very high-priced or low-priced home sales in any given year, whereas the median sale price better represents the pricing of a majority of homes in a given market.

• Based on a median list price of $135,200, the income required to afford a home at this price

would be about $38,630 to $45,065, based on the standard of 3.0 to 3.5 times the median income (and assuming these households do not have a high level of debt). A household with significantly more equity (in an existing home and/or savings) could afford a higher priced home. About 63.5% of Plainview households have annual incomes at or above $38,630.



Price Range No. Pct. No. Pct.

< $49,999 0 0.0% 0 0.0%$50,000 to $74,999 1 5.0% 0 0.0%$75,000 to $99,999 5 25.0% 0 0.0%$100,000 to $124,999 3 15.0% 0 0.0%$125,000 to $149,999 2 10.0% 0 0.0%$150,000 to $174,999 3 15.0% 0 0.0%$175,000 to $199,999 0 0.0% 0 0.0%$200,000 to $249,999 2 10.0% 0 0.0%$250,000 to $299,999 2 10.0% 0 0.0%$300,000 to $349,999 1 5.0% 0 0.0%$350,000 to $399,999 0 0.0% 0 0.0%$400,000 to $449,999 0 0.0% 0 0.0%$450,000 to $499,999 0 0.0% 0 0.0%$500,000 and Over 1 5.0% 0 0.0%

20 100% 0 0%

MinimumMaximum

MedianAverage

1 Includes townhomes, twinhomes, and condominiums

Sources: Regional Multiple Listing Service of MN ("RMLS") Maxfield Research Inc.

$172,975 n/a

$59,900 n/a$524,000 n/a$135,200 n/a

Single-Family Multifamily1

TABLE FS-3HOMES CURRENTLY LISTED FOR-SALE

CITY OF PLAINVIEWOCTOBER 2014

• About 30% of homes of sale in Plainview are priced under $100,000; however most of these listings are priced between $75,000 and $99,999. Only 10% of Plainview’s listings are priced more than $300,000.

• One-story homes made up the highest percentage (40%) of active single-family listings. One

and half story homes and two homes have the second and third highest percentages at 25%, respectively.



0

1

2

3

4

5

6

7

Under$100k

$100k to$149.9k

$150k to$199.9k

$200k to$249.9k

$250k to$299.9k

$300k to$399.9k

$400k to$499.9k

$500k+

# of

Lis

tings

List Price

Plainview Active Listings - October 2014

Single-Family Multifamily

• Overall, the average list price per square foot (“PSF”) among all active single-family listings

is $91/foot. Two-story homes have the highest PSF costs at $103; however this is skewed up based on one listing. One and one-half story homes have the lowest list price PSF ($74).

• The median list price in neighboring Olmsted County is about $185,000; or 40% higher than

Plainview’s median list price of about $135,000.

Avg. List Avg. Size Avg. List Price Avg. Avg. Avg. AgeProperty Type Listings Pct. Price (Sq. Ft.) Per Sq. Ft. Bedrooms Bathrooms of Home

One story 8 40.0% $192,950 2,086 $92 3.4 2.0 19871.5-story 5 25.0% $89,500 1,208 $74 2.8 1.6 19472-story 5 25.0% $228,120 2,213 $103 3.6 2.8 1949Other 2 10.0% $163,900 2,162 $76 3.0 2.0 1993Total 20 100.0% $216,611 1,906 $114 3.3 2.1 1968

Source: Regional Multiple Listing Service of MN; Maxfield Research Inc.

TABLE FS-4ACTIVE LISTINGS BY HOUSING TYPE

October 2014

Single-Family

CITY OF PLAINVIEW



2

5

5

8

0 2 4 6 8 10

Other

2 story

1.5-story

One story

Number

Hsg.

Typ

eListings by Housing Type - City of Plainview

October 2014

$163,900

$228,120

$89,500

$192,950

$0

$20

$40

$60

$80

$100

$120

$0

$50,000

$100,000

$150,000

$200,000

$250,000

Per S

q. F

t.

Avg.

Lis

t Pric

e

Housing Type

Average List Price & Price per Square Foot - City of PlainviewOctober 2014

Avg. List Price PSF



Owner-Occupied Turnover Table FS-5 illustrates existing home turnover as a percentage of owner occupied units with one unit in Plainview. Resales are based on historic transaction volume between 2000 and 2014 as listed on the Multiple Listing Service. Owner-occupied housing units are sourced to the U.S. Census as of 2010. As displayed in the table, approximately 6% of the Plainview’s one-unit owner-occupied hous-ing stock is sold annually. Typically we find owner-occupied turnover ranges from 3% at the low-end to 8% at the high-end in many communities throughout Minnesota.

Owner-occupied Resales TurnoverSubmarket Housing Units1 Annual Avg.2 Pct.Plainview 886 51 5.8%

1 One unit owner-occupied housing units in structure (2010)2 Average of MLS resales between 2000 and 2014

Source: U.S. Census Bureau, SEMAR, Maxfield Research Inc.

TABLE FS-5OWNER-OCCUPIED TURNOVER

CITY OF PLAINVIEW

Lender-Mediated Properties Table FS-6 summarizes sheriff sale foreclosures in Wabasha County, the State of Minnesota, Grater Minnesota, and the Twin Cities between 2005 and 2013. The data is prepared by Hous-ingLink with assistance from the Minnesota Housing Finance agency (MHFA), Greater Minneso-ta Housing Fund (GMHF), Minnesota Homeownership Center, and Family Housing Fund. Foreclosures are properties in which the financial institutions or lender has taken possession of the home from the owner due to non-payment of mortgage obligations/default by the borrow-er. Lenders want to move the debt off their books and will hence discount the asking price. Lender-mediated property information (foreclosures or short sales) is an important metric when reviewing the health of real estate markets. After the real estate bust and ensuing Great Recession, lender-mediated homes increased substantially as an overall market share of the for-sale inventory. The higher market share resulted in downward pricing on aggregate sales price figures, giving the impression that the entire housing market was losing considerable val-ue. However, real estate sales data shows stark differences between traditional and lender-mediated transactions. Key points from Table FS-6 follow.



• The number of foreclosures in Wabasha County crested in 2008 with 84 properties. How-ever, between 2008 and 2013 the number of foreclosures has decreased by about 60%.

• Excluding 2005, Wabasha County has had a lower foreclosure rate than Greater Minnesota through 2013. Compared to the State of Minnesota average and the Twin Cities average, the foreclosure rate in Wabasha County has been significantly lower.

• As the housing market continues to rebound the number of foreclosures is projected to de-

cline in 2015 and beyond.

32

5858

80

60

84

47

38

28

0

10

20

30

40

50

60

70

80

90

201320122011201020092008200720062005

# of

For

eclo

sure

s

Year

Wabasha Cty. Foreclosures: 2005-2013



ForeclosuresCount % Change Count % Change Count % Change Count % Change

2013 32 -44.8% 11,834 -33.9% 5,080 -29.5% 6,754 -36.8%2012 58 0.0% 17,895 -16.0% 7,209 -11.2% 10,686 -18.9%2011 58 -27.5% 21,298 -17.0% 8,117 -18.0% 13,181 -16.5%2010 80 33.3% 25,673 11.5% 9,894 15.6% 15,779 9.1%2009 60 -28.6% 23,019 -12.3% 8,560 -4.8% 14,459 -16.2%2008 84 78.7% 26,251 28.7% 8,987 21.0% 17,264 33.1%2007 47 23.7% 20,398 71.3% 7,430 55.5% 12,968 81.9%2006 38 35.7% 11,907 84.0% 4,777 76.5% 7,130 89.4%2005 28 -- 6,472 -- 2,707 -- 3,765 --

Foreclosure RateRate % Change Rate % Change Rate % Change Rate % Change

2013 0.37 -45.6% 0.65 -34.3% 0.57 -29.6% 0.73 -37.1%2012 0.68 0.0% 0.99 -16.1% 0.81 -11.0% 1.16 -18.9%2011 0.68 -27.7% 1.18 -16.9% 0.91 -18.0% 1.43 -16.9%2010 0.94 32.4% 1.42 10.9% 1.11 14.4% 1.72 8.9%2009 0.71 -28.3% 1.28 -12.3% 0.97 -4.9% 1.58 -16.4%2008 0.99 76.8% 1.46 27.0% 1.02 20.0% 1.89 31.3%2007 0.56 21.7% 1.15 69.1% 0.85 54.5% 1.44 80.0%2006 0.46 35.3% 0.68 78.9% 0.55 71.9% 0.80 86.0%2005 0.34 -- 0.38 -- 0.32 -- 0.43 --

Foreclosure rate = the number of foreclosed mortgages as a percent of total residential parcels

Sources: HousingLink; Maxfield Research, Inc.

TABLE FS-6SHERIFF'S SALE FORECLOSURES IN MINNESOTA

2005 - 2013

Wabasha County Minnesota Greater MN Twin Cities



0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

201320122011201020092008200720062005

Foreclosure Rate Trend

Wabasha County

Minnesota

Greater MN

Twin Cities

Homestead Exclusion The State of Minnesota provides owner-occupied and qualified relative properties a reduction in their property taxes. The 2011 Minnesota Legislature repealed the Homestead Market Value Credit and replaced it with the Homestead Market Value Exclusion. To be eligible to receive the Homestead Exclusion, the following three requirements must ap-ply:

1. Be one of the owners or a qualifying relative of one of the owners of the property 2. Occupy the property as your primary residence 3. Be a Minnesota resident

The State of Minnesota also allows properties preferential homestead property tax treatment if the property is occupied by a relative of the owner. For purposes of “Relative Homestead,” the relative includes a parent, stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew or niece. The relationship may be either by blood or marriage. A property that is non-homesteaded has higher property taxes and does not qualify for the Minnesota property tax refund. Simply put, homesteaded properties are typically owner-occupied and non-homesteaded properties are typically renter-occupied. In most cases, the median and average assessed values are higher for homesteaded properties than for non-homesteaded properties. This indicates that homesteaded properties are a combination of larger, better-maintained, or more recently-updated than non-homesteaded properties.



Since a non-homesteaded property is not always a primary residence, many non-homesteaded housing units are either second/vacation homes or investment rental property. Although not all non-homesteaded properties are investment related, the majority in the City of Plainview are likely rental properties. Table FS-7 inventories Plainview residential properties based on property type and homestead-ed classification. The table omits vacant land and any non-residential use. The table provides insight on the number of non-homesteaded properties that could potentially be investment properties and functioning as rental property. The table is based on 2014 Wabasha County tax records. Key findings from the table follow. • Non-homesteaded properties account for about 11% of all housing units in Plainview. • About 9% of all single-family housing units in Plainview are non-homesteaded; we estimate

most of these properties are single-family rentals. Market values for non-homesteaded sin-gle-family properties are nearly 15% lower than the homesteaded properties.

• The average market values by property type are highest among multifamily rental proper-

ties; however many of these buildings have multiple units.

Total Average Total Average Property Type Parcels Market Value Market Value Parcels Market Value Market Value

Residential 959 $105,643,200 $110,160 99 $9,448,800 $95,442Res 1-3 Units 4 $237,600 $59,400Res Duplex/Triplex 3 $344,500 $114,833 2 $394,500 $197,2504D 4 or More Units 3 $2,837,300 $945,767Res 4 or more Units 1 $168,500 $168,500 8 $3,120,100 $390,013Manufactured Home Park 2 $547,500 $273,750Res/Ag 8 $1,281,400 $160,175Total 971 $107,437,600 $110,646 118 $16,585,800 $140,558

Note: Excludes vacant land and includes only residential parcels.

Source: Wabasha County Assessor; Maxfield Research Inc.

Homesteaded Non-Homesteaded

2014

TABLE FS-7PLAINVIEW RESIDENTIAL PARCELS WITH BUILDINGSHOMESTEAD VS. NON-HOMESTEAD COMPARISON



Actively Marketing Subdivisions Table FS-8 identifies subdivision with available lots in Plainview. The table identifies the num-ber of lots, available lots, typical lot sizes, and assessed and marketing values for lots and homes. Please note, the table does not include scattered, infill lots. Key points from the table follow. • There are five active subdivisions with available lots in Plainview. Combined, there are 35

vacant lots. However, 60% of the vacant lots are zoned for twinhomes. As a result, there are only 14 vacant single-family lots in these subdivisions.

• There have been no new platted subdivisions in Plainview since 2003.

• Many of the subdivisions are a mix of traditional single-family homes with a few twinhome lots intermingled. However, most of the vacant lots exist with the platted twinhome lots.

• Most of the single-family lots have lot widths of about 80’ to 90’ wide; resulting in average

lot sizes of nearly one-third an acre. The larger lot widths are required to meet the set-backs for ranch-style homes that are desired by many buyers.

• The average assessed value for homes in the five active subdivisions is about $24,800 for

the land and $161,200 for the total assessed value. Marketing lots in Plainview generally range from about $29,000 to $40,000.

• All of the subdivisions are “open builder” developments with no builder restrictions. How-ever, most new subdivisions have their own subdivision design guidelines by which builders’ must abide by.

• New construction activity in Plainview has been very slow since the market plateaued last

decade between 2005 and 2007. Since 2010, there have been an average of only three homes annually constructed in Plainview.

• The Harvest Ridge Subdivision is a mix of 20 tax-credit rental townhomes and 32 single-

family and twinhome lots. The project is a joint effort between First Homes and Three Riv-ers Community Action. As a result, the for-sale units have income guidelines established at 80% of the State of Minnesota Area Median Income (AMI). The project has a total of nine vacant units; six twin home lots owned by Three Rivers Community Action and three owned by First Homes. Most of the homes were built between 2003 and 2008 and averaged about $150,000. The purchase prices were brought down through tax increment financing and passed along to the builders. At this time the project is not actively marketing.



Lot No. of Vacant/Subdivion Types Lots Avail. Lots Min Max Avg. Min Max Avg. Min Max Avg. Min Max Avg. Comments

City of Plainview

Anastacia Estates SF/MF 22 8 0.15 - 1.21 0.31 $8,100 - $43,800 $24,930 $195,600 - $380,000 $260,833 $32,000 - $37,000 $34,500

Harvest Ridge Subdivision SF/MF 32 9 0.15 - 1.49 0.31 $3,300 - $35,000 $21,273 $82,300 - $136,200 $116,320 $30,000 - $40,000 $35,000

Levan Subdivision SF/MF 32 9 0.20 - 2.42 0.42 $19,800 - $36,500 $28,756 $97,900 - $267,900 $139,318 $29,000 - $31,000 $30,000

Orchard Hills West 5th SF/MF 19 6 0.25 - 0.55 0.34 $22,500 - $39,200 $29,189 $179,100 - $270,200 $152,232 $31,000 - $41,000 $35,000

Orchard Hills North SF/MF 29 3 0.18 - 0.83 0.28 $9,900 - $36,400 $21,507 $96,800 - $294,000 $165,154 $22,500 - $39,000 $30,000

Subtotal 134 35

1 Lot value and home value based on Deleware County Assessor data.

Source: Wabasha County Assessor, Interviews with Realtors, Maxfield Research Inc.

Income Guidelines apply: First Homes & Three Rivers Community Action

Harvest Ridge TH located in subdivision

8 twinhome lots remain; none have been developed. All SF lots sold

TH lots around $23,000; most SF lots $35,000+. 2 vacant TH lots and 1 SF lot

0.33 $24,833 $161,199 $32,642

TABLE FS-8ACTIVELY MARKETING SINGLE-FAMILY & MULTIFAMILY SUBDIVISIONS

CITY OF PLAINVIEW4thQ 2014

Average Size of Lots (Acres) Average AsssessedLot/Land Value Average Assessed Home+Lot Value Marketing Land/Lot Value

FOR SALE MARKET ANALYSIS


Manufactured Homes (i.e. “Mobile Homes”) Maxfield Research Inc. inventoried manufactured homes and manufactured home parks in Plainview. Traditionally, research shows that manufactured homes usually serve as an alterna-tive to permanent housing. During times of housing scarcity, the number of homes usually ris-es. Table FS-9 displays information pertaining to the two manufactured home parks in Plainview. The following are key points. • Plainview has two manufactured home parks with a total of 120 manufactured home

pads/lots. Edgewood Acres is the largest mobile home park in Plainview.

ApproximateProject Name/ Address # of Pads Comments

Edgewood Acres 100411 8th Avenue NEPlainview

Hillcrest Terrace 20607 6th Avenue NWPlainview


TABLE FS-9MOBILE HOME PARKS

PLAINVIEWFebruary 2015

Unavailable for comments.

Unavailable for comments.

• Property managers at Edgewood Acres and Hillcrest Terrace were unavailable for com-

ments. Pad totals for both mobile home parks were estimated based on information avail-able from various online resources.

Pending For-Sale Developments According to the City of Plainview, there are no pending for-sale housing developments in the planning process at this time.



Realtor/Builder Interviews Maxfield Research Inc. interviewed real estate agents, home builders, developers, and other professionals familiar with Plainview’s owner-occupied market to solicit their impressions of the for-sale housing market in the community. Key points are summarized by topic as follows. Market Overview • Plainview Realtors considered 2014 one of the best years on the local real estate market

since the housing downturn. Although the year started slow due to the harsh winter, the market picked up in spring 2014 and overall activity was strong across all price ranges. Real-tor’s believe the positive momentum from 2014 will carry into 2015 and expect 2015 to outperform last year.

• The current inventory of homes for sales is low in Plainview; however Realtors stressed in-ventory is lowest in the winter months and they expect supply to increase in the spring.

• Realtors also mentioned that the inventory is lacking move-up homes for-sale in the

$150,000 to $200,000 price range.

• Realtors commented on the importance of the school district and the role it plays in the lo-cal housing market. Plainview has an excellent school district and should be marketed to Rochester area households who desire smaller class sizes.

• There are very few options for households who desire maintenance-free association living

in Plainview. Many baby boomers and retirees move to the Rochester area for mainte-nance-free housing products not available in Plainview. Realtors commented that a quality townhome development priced under $200,000 would be desired.

• Plainview housing costs are generally defined as follows:

o Entry-level: less than $110,000 o Move-up: $125,000 to $180,000 o Executive: $225k to $300,000

• Realtors’ stressed the important of today’s historic low interest rates that has allowed many

buyers to stress their housing dollar. Although interest rates are presently low, there is concern that higher interest rates in 2015 could slow real estate activity as affordability will decrease.

• Realtors commented on the lack of rental housing in Plainview and the demand for single-

family rental housing. Most single-family rentals in Plainview rent from $650 to $850 per month; however some rentals can exceed $1,000/month. Generally, the ceiling for rental



housing in Plainview is $1,000/month as many renters would prefer to buy versus rent at that price point.

• Most home buyers in Plainview finance their home through one the local banks in the community. The local banks offer competitive financing and many of mortgage programs that offered in the Rochester marketplace.

New Construction/Lot Supply

• Interviewees stated there is a lack of quality move-up or choice lots in Plainview. Such lots

would feature wider lot widths to accommodate ranch-style homes and ideally would fea-ture walk-outs.

• Municipal lots in newer subdivisions in generally range from $30,000 to $40,000. Subdivi-sions with income restrictions have lot costs around $25,000.

• The preferred new construction type has been the single-family ranch-style home that has

1,700 square feet or more on the main-level and a full basement. Many buyers have opted to have an unfinished basement that they can finish at a later date. These housing type has been popular with buyers of all ages as it allows buyers to age-in-place and has strong re-sale values.

• Families with children have historically been the target market for new construction in

Plainview. Many of these buyers may have grown up in Plainview and moved away to a larger community like Rochester, but once they have children they desire to move back to Plainview to raise their children.

• Interviewees stated that the cost to develop new municipal subdivisions is escalating as the

average upfront cost for infrastructure (i.e. curb and gutter, streets, ponding, etc.) is ex-ceeding $35,000 to $40,000 per lot plus raw land costs. Because of the upfront develop-ment costs, most developers are unable to absorb the land holding costs during the absorp-tion period given historic lot sale trends in Plainview.

• Builders and contractors are still weary to construct speculative homes in today’s real estate

environment. Recently completed spec homes have taken a long time to sell which has re-sulted in the builder holding costs that are not profitable for the builder/developer.

• Although Plainview was not hit as hard as many communities during the housing downturn

and Great Recession; Plainview new construction competes against other communities where builders purchased distressed lots at significant discounts. As a result, builders can deliver a more affordable housing product in other communities where the land costs have been substantially lower.



• There have been few recent subdivisions platted that have not had TIF or other financial as-sistance. Given the infrastructure costs to development new lots today, the risk is very high for developers to finance new subdivisions with their own capital given the sales price of lots.

• There is some demand for large-acreage lots (2+ acres) in the surrounding townships. Alt-

hough lot costs are higher and priced from $50,000 or more, some move-up buyers are at-tracted to the larger lot-sizes and lower taxes outside of municipal limits.

• Interviewees mentioned new construction costs can be as low as $135 PSF; however mot

new homes tend to at $150 PSF or more. Most Realtors and builders thought it was ex-tremely difficult to build a new home for less than $200,000 today. As a result, new con-struction is priced significantly higher than the existing home stock in Plainview.

HOUSING AFFORDABILITY


Introduction Affordable housing is a term that has various definitions according to different people and is a product of supply and demand. According to the U.S. Department of Housing and Urban De-velopment (HUD), the definition of affordability is for a household to pay no more than 30% of its annual income on housing (including utilities). Families who pay more than 30% of their in-come for housing (either rent or mortgage) are considered cost burdened and may have diffi-culty affording necessities such as food, clothing, transportation and medical care. Generally, housing that is income-restricted to households earning at or below 80% of Area Median Income (AMI) is considered affordable. However, many individual properties have in-come restrictions set anywhere from 30% to 80% of AMI. Rent is not based on income but in-stead is a contract amount that is affordable to households within the specific income re-striction segment. Moderate-income housing, often referred to as “workforce housing,” refers to both rental and ownership housing. Hence the definition is broadly defined as housing that is income-restricted to households earning between 50% and 120% AMI. Figure 1 below summa-rizes income ranges by definition.

Definition

Extremely Low Income 0% - 30%

Very Low Income 31% - 50%

Low Income 51% - 80%

Moderate Income | Workforce Housing 50% - 120%

Note: Wabasha County 4-person AMI = $69,000 (2014)

FIGURE 1AREA MEDIAN INCOME (AMI) DEFINITIONS

AMI Range

Naturally-Occurring Affordable Housing (i.e. Unsubsidized Affordable) Although affordable housing is typically associated with an income-restricted property, there are other housing units in communities that indirectly provide affordable housing. Housing units that were not developed or designated with income guidelines (i.e. assisted) yet are more affordable than other units in a community are considered “naturally-occurring” or “unsubsi-dized affordable” units. This rental supply is available through the private market, versus as-sisted housing programs through various governmental agencies. Property values on these units are lower based on a combination of factors, such as: age of structure/housing stock, loca-tion, condition, size, functionally obsolete, school district, etc. Because of these factors, hous-ing costs tend to be lower. According to the Joint Center for Housing Studies of Harvard University, the privately unsubsi-dized housing stock supplies three times as many low-cost affordable units than assisted pro-



jects nationwide. Unlike assisted rental developments, most unsubsidized affordable units are scattered across small properties (one to four unit structures) or in older multifamily structures. Many of these older developments are vulnerable to redevelopment due to their age, modest rents, and deferred maintenance. Because many of these housing units have affordable rents, project-based and private housing markets cannot be easily separated. Some households (typically those with household incomes of 50% to 60% AMI) income-qualify for both market rate and project-based affordable housing. Rent and Income Limits Table HA-1 shows the maximum allowable incomes by household size to qualify for affordable housing and maximum gross rents that can be charged by bedroom size in Wabasha County. These incomes are published and revised annually by the Department of Housing and Urban Development (HUD) and also published separately by the Minnesota Housing Finance Agency based on the date the project was placed into service. Fair market rent is the amount needed to pay gross monthly rent at modest rental housing in a given area. This table is used as a basis for determining the payment standard amount used to calculate the maximum monthly subsidy for families at financially assisted housing. Table HA-2 shows the maximum rents by household size and AMI based on income limits illus-trated in Table HA-1. The rents on Table HA-2 are based on HUD’s allocation that monthly rents should not exceed 30% of income. In addition, the table reflects maximum household size based on HUD guidelines of number of persons per unit. For each additional bedroom, the maximum household size increases by two persons.



1 pph 2 phh 3 phh 4 phh 5 phh 6 phh 7 phh 8 phh

30% of median $14,490 $16,560 $18,630 $20,700 $22,380 $24,030 $25,680 $27,33050% of median $24,150 $27,600 $31,050 $34,500 $37,300 $40,050 $42,800 $45,550

60% of median $28,980 $33,120 $37,260 $41,400 $44,760 $48,060 $51,360 $54,660

80% of median $38,640 $44,160 $49,680 $55,200 $59,680 $64,080 $68,480 $72,880

100% of median $48,300 $55,200 $62,100 $69,000 $74,600 $80,100 $85,600 $91,100

120% of median $57,960 $66,240 $74,520 $82,800 $89,520 $96,120 $102,720 $109,320

EFF 1BR 2BR 3BR 4BR

30% of median $362 $414 $465 $517 $55950% of median $603 $690 $776 $862 $93260% of median $724 $828 $931 $1,035 $1,11980% of median $966 $1,104 $1,242 $1,380 $1,492100% of median $1,207 $1,380 $1,552 $1,725 $1,865120% of median $1,449 $1,656 $1,863 $2,070 $2,238

EFF 1BR 2BR 3BR 4BR

Fair Market Rent $508 $511 $637 $939 $997

Sources: MHFA, HUD, Maxfield Research Inc.

TABLE HA-1MHFA/HUD INCOME AND RENT LIMITS

WABASHA COUNTY- 2014

Income Limits by Household Size

Maximum Gross Rent

Fair Market Rent



Unit Type1 Min Max Min. Max. Min. Max. Min. Max. Min. Max. Min. Max. Min. Max.

Studio 1 1 $362 - $362 $604 - $604 $725 - $725 $966 - $966 $1,208 - $1,208 $1,449 - $1,4491BR 1 2 $362 - $414 $604 - $690 $725 - $828 $966 - $1,104 $1,208 - $1,380 $1,449 - $1,6562BR 2 4 $414 - $518 $690 - $863 $828 - $1,035 $1,104 - $1,380 $1,380 - $1,725 $1,656 - $2,0703BR 3 6 $466 - $601 $776 - $1,001 $932 - $1,202 $1,242 - $1,602 $1,553 - $2,003 $1,863 - $2,4034BR 4 8 $518 - $683 $863 - $1,139 $1,035 - $1,367 $1,380 - $1,822 $1,725 - $2,278 $2,070 - $2,733

Sources: HUD, Novogradac, MHFA, Maxfield Research Inc.

TABLE HA-2

1 One-bedroom plus den and two-bedroom plus den units are classified as 1BR and 2BR units, respectively. To be classified as a bedroom, a den must have a window and closet.

MAXIMUM RENT BASED ON HOUSEHOLD SIZE AND AREA MEDIAN INCOMEWABASHA COUNTY - 2014

Note: 4-person Wabasha County AMI is $69,000 (2014)

HHD SizeMaximum Rent Based on Household Size (@30% of Income)

30% 60% 80% 100% 120%50%



Housing Cost Burden Table HA-3 shows the number and percentage of owner and renter households in Plainview pay 30% or more of their gross income for housing. This information was compiled from the Ameri-can Community Survey 2013 estimates. This information is different than the 2000 Census which separated households that paid 35% or more in housing costs. As such, the information presented in the tables may be overstated in terms of households that may be “cost bur-dened.” The Federal standard for affordability is 30% of income for housing costs. Without a separate break out for households that pay 35% or more, there are likely a number of house-holds that elect to pay slightly more than 30% of their gross income to select the housing that they choose. Moderately cost-burdened is defined as households paying between 30% and 50% of their income to housing; while severely cost-burdened is defined as households paying more than 50% of their income for housing. Higher-income households that are cost-burdened may have the option of moving to lower priced housing, but lower-income households often do not. The figures focus on owner house-holds with incomes below $50,000 and renter households with incomes below $35,000. Key findings from Table HA-3 follow.

• About 23% of owner households and 35% of renter householders are estimated to be pay-

ing more than 30% of their income for housing costs in Plainview. Compared to the Minne-sota average, the percentage of cost burdened households is lower in Plainview. Minnesota cost burdened households are 25% for owner households and 49% for renter households.

• The number of cost burdened households in Plainview increases proportionally based on

lower incomes. About 47% of renters with incomes below $35,000 are cost burdened and 50% of owners with incomes below $50,000 are cost burdened.

• Median contract rents in Plainview ($488) and Wabasha County ($518) are significantly less

than the State of Minnesota average ($734).



No. Pct. No. Pct. No. Pct.

Owner HouseholdsAll Owner Households 1,065 7,323 1,528,272 Cost Burden 30% or greater 247 23.3% 1,663 22.8% 381,792 25.1%

Owner Households w/ incomes <$50,000 431 2,897 470,975 Cost Burden 30% or greater 212 50.0% 1,286 45.0% 241,084 51.9%

Renter HouseholdsAll Renter Households 247 1,567 578,960 Cost Burden 30% or greater 81 35.1% 648 48.6% 267,876 49.2%

Renter Households w/ incomes <$35,000 187 946 321,495 Cost Burden 30% or greater 81 47.4% 549 68.0% 230,460 77.2%

Median Contract Rent1

1 Median Contract Rent 2013

Note: Calculations exclude households not computed.

Sources: American Community Survey, 2009-2013 estimates; Maxfield Research Inc.

TABLE HA-3HOUSING COST BURDEN

PLAINVIEW & WABASHA COUNTY2013

Plainview Wabasha County

$488 $518 $734

Minnesota

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Plainview Wabasha County Minnesota

Cost Burdened

All Renter HHs Renter HHs <$35k All Owner HHs Owner HHs <$50k



23.3% 22.8% 25.1%

50.0%45.0%

51.9%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%


Owner Cost Burdened

All Owner HHs Owner HHs <$50k

35.1%

48.6% 49.2%47.4%

68.0%

77.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%


Renter Cost Burdened

All Renter HHs Renter HHs <$35k



$488$518

$734

$0

$100

$200

$300

$400

$500

$600

$700

$800


Median Contract Rent

Housing Vouchers In addition to subsidized apartments, “tenant-based” subsidies like Housing Choice Vouchers, can help lower income households afford market-rate rental housing. The tenant-based subsi-dy is funded by the Department of Housing and Urban Development (HUD), and is managed by the Southeastern Minnesota Multi-County Housing and Redevelopment Authority (“SEMMHRA”). Under the Housing Choice Voucher program (also referred to as Section 8) qualified households are issued a voucher that the household can take to an apartment that has rent levels with Payment Standards. The household then pays approximately 30% of their adjusted gross income for rent and utilities, and the Federal government pays the remainder of the rent to the landlord. The maximum income limit to be eligible for a Housing Choice Vouch-er is 50% AMI based on household size, as shown in Table HA-1. Currently, SEMMHRA administers 14 Housing Choice Vouchers in Plainview.

Housing Costs as Percentage of Household Income Housing costs are generally considered affordable at 30% of a households’ adjusted gross in-come. Table HA-5 on the following page illustrates key housing metrics based on housing costs and household incomes in the Plainview Market Area. The table estimates the percentage of Plainview Market Area householders that can afford rental and for-sale housing based on a 30% allocation of income to housing. Housing costs are based on averages in Plainview.



The housing affordability calculations assume the following:

For-Sale Housing 10% down payment with good credit score Closing costs rolled into mortgage 30-year mortgage at 3.750% interest rate Private mortgage insurance (equity of less than 20%) Homeowners insurance for single-family homes and association dues for townhomes Owner household income per 2012 ACS Rental Housing Background check on tenant to ensure credit history 30% allocation of income Renter household income per 2012 ACS Because of the down payment requirement and strict underwriting criteria for a mortgage, not all households will meet the income qualifications as outlined above.

• About 90% of existing owner households could afford to buy an entry-level home

($100,000) in Plainview. Furthermore, about 55% of existing owner households could af-ford to purchase a home of $250,000.

• About 62% of existing renter households can afford to rent a two-bedroom unit in Plainview ($575/month). The percentage of renter income-qualified households decreases should a new apartment building with higher rents ensue. About 43% of renters could afford a two-bedroom based on a rent of $800/month in a new construction building.



For-Sale (Assumes 10% down payment and good credit)

Entry-Level Move-Up Executive Entry-Level Move-Up ExecutivePrice of House $100,000 $135,000 $250,000 $125,000 $150,000 $200,000Pct. Down Payment 10.0% 10.0% 10.0% 10.0% 10.0% 10.0%Total Down Payment Amt. $10,000 $13,500 $25,000 $12,500 $15,000 $20,000Estimated Closing Costs (rolled into mortgage) $3,000 $4,050 $7,500 $3,750 $4,500 $6,000Cost of Loan $93,000 $125,550 $232,500 $116,250 $139,500 $186,000

Interest Rate 3.750% 3.750% 3.750% 3.750% 3.750% 3.750%Number of Pmts. 360 360 360 360 360 360

Monthly Payment (P & I) -$431 -$581 -$1,077 -$538 -$646 -$861(plus) Prop. Tax -$125 -$169 -$313 -$156 -$188 -$250(plus) HO Insurance/Assoc. Fee for TH -$33 -$45 -$83 -$100 -$100 -$100(plus) PMI/MIP (less than 20%) -$40 -$54 -$101 -$50 -$60 -$81

Subtotal monthly costs -$629 -$850 -$1,573 -$845 -$994 -$1,292

Housing Costs as % of Income 30% 30% 30% 30% 30% 30%

Minimum Income Required $25,173 $33,984 $62,933 $33,800 $39,760 $51,680

Pct. of ALL Plainview MA HHDS who can afford1 83.8% 75.6% 49.9% 75.8% 70.6% 60.2%No. of Plainview MA HHDS who can afford1 2,431 2,194 1,449 2,199 2,047 1,747

Pct. of Plainview MA owner HHDs who can afford2 90.2% 83.9% 55.1% 84.1% 77.7% 64.4%No. of Plainview MA owner HHDs who can afford2 2,126 1,977 1,299 1,980 1,829 1,518No. of Plainview MA owner HHDS who cannot afford2 230 379 1,057 376 527 838

Rental (Market Rate)

1BR 2BR 3BR 1BR 2BR 3BRMonthly Rent $575 $650 $800 $950Annual Rent n/a $6,900 n/a $7,800 $9,600 $11,400

Housing Costs as % of Income n/a 30% n/a 30% 30% 30%

Minimum Income Required n/a $23,000 n/a $26,000 $32,000 $38,000

Pct. of ALL Plainview MA HHDS who can afford1 n/a 85.6% n/a 83.0% 77.5% 72.1%No. of Plainview MA HHDS who can afford1 n/a 2,484 n/a 2,410 2,248 2,092

Pct. of Plainview MA renter HHDs who can afford2 n/a 62.3% n/a 55.7% 42.9% 33.3%No. of Plainview MA renter HHDs who can afford2 n/a 340 n/a 304 234 182No. of Plainview MA. renter HHDS who cannot afford2 n/a 206 n/a 242 312 364

1 Based on 2014 household income for ALL households2 Based on 2013 ACS household income by tenure (i.e. owner and renter incomes. Owner incomes = $56,406 vs. renter incomes = $19,489)Source: Maxfield Research Inc.

Existing Rental New Rental

TABLE HA-4PLAINVIEW MARKET AREA HOUSING AFFORDABILITY - BASED ON HOUSEHOLD INCOME

Single-Family New Townhome/Twinhome

HOUSING DEMAND ANALYSIS


Introduction Previous sections of this study analyzed the existing housing supply and the growth and demo-graphic characteristics of the population and household base in Plainview and the Plainview Market Area. This section of the report presents our estimates of housing demand in the Plainview Market Area from 2014 through 2025. Demographic Profile and Housing Demand The demographic profile of a community affects housing demand and the types of housing that are needed. The housing life-cycle stages are:

1. Entry-level householders • Often prefer to rent basic, inexpensive apartments • Usually singles or couples in their early 20’s without children • Will often “double-up” with roommates in apartment setting

2. First-time homebuyers and move-up renters

• Often prefer to purchase modestly-priced single-family homes or rent more upscale apartments

• Usually married or cohabiting couples, in their mid-20's or 30's, some with children, but most are without children

3. Move-up homebuyers

• Typically prefer to purchase newer, larger, and therefore more ex-pensive single-family homes

• Typically families with children where householders are in their late 30's to 40's

4. Empty-nesters (persons whose children have grown and left home) and nev-

er-nesters (persons who never have children) • Prefer owning but will consider renting their housing • Some will move to alternative lower-maintenance housing products • Generally couples in their 50's or 60's

5. Younger independent seniors

• Prefer owning but will consider renting their housing • Will often move (at least part of the year) to retirement havens in the

Sunbelt and desire to reduce their responsibilities for upkeep and maintenance

• Generally in their late 60's or 70's



6. Older seniors • May need to move out of their single-family home due to physical

and/or health constraints or a desire to reduce their responsibilities for upkeep and maintenance

• Generally single females (widows) in their mid-70's or older Demand for housing can come from several sources including: household growth, changes in housing preferences, and replacement need. Household growth necessitates building new housing unless there is enough desirable vacant housing available to absorb the increase in households. Demand is also affected by shifting demographic factors such as the aging of the population, which dictates the type of housing preferred. New housing to meet replacement need is required, even in the absence of household growth, when existing units no longer meet the needs of the population and when renovation is not feasible because the structure is physi-cally or functionally obsolete. Outstate communities and rural areas tend to have higher proportions of younger households that own their housing than in the larger growth centers or metropolitan areas. In addition, senior households tend to move to alternative housing at an older age. These conditions are a result of housing market dynamics, which typically provide more affordable single-family hous-ing for young households and a scarcity of senior housing alternatives for older households. The graphic on the following page provides greater detail of various housing types supported within each housing life cycle. Information on square footage, average bedrooms/bathrooms, and lot size is provided on the subsequent graphic. Housing Demand Overview The previous sections of this assessment focused on demographic and economic factors driving demand for housing in the Plainview Market Area. In this section, we utilize findings from the economic and demographic analysis to calculate demand for new general occupancy housing units in Plainview. Housing markets are driven by a range of supply and demand factors that vary by location and submarket. The following points outline several of the key variables driving housing demand.



Age Student Rental 1st-time Move-up 2nd Empty Nester/ SeniorCohort Housing Housing Home Buyer Home Buyer Home Buyer Downsizer Housing

18-24 18 - 2425-2930-3435-3940-4445-4950-5455-5960-6465-6970-7475-7980-8485+


DEMOGRAPHICS & HOUSING DEMAND

18-34

65-79

25-39

30-49

40-64

55-74

55+ & 65+



Target Market/ Unit/Home Lot Sizes/Demographic Characteristics Units Per Acre

Entry-level single-family 1,200 to 2,200 sq. ft. 80'+ wide lot2-4 BR | 2 BA 2.5-3.0 DU/Acre

Move-up single-family 2,000 sq. ft.+ 80'+ wide lot3-4 BR | 2-3 BA 2.5-3.0 DU/Acre

Executive single-family 2,500 sq. ft.+ 100'+ wide lot3-4 BR | 2-3 BA 1.5-2.0 DU/Acre

Small-lot single-family 1,700 to 2,500 sq. ft. 40' to 60' wide lot3-4 BR | 2-3 BA 5.0-8.0 DU/Acre

Entry-level townhomes 1,200 to 1,600 sq. ft. 6.0-12.0 DU/Acre2-3 BR | 1.5BA+

Move-up townhomes 1,400 to 2,000 sq. ft. 6.0-8.0. DU/Acre2-3 BR | 2BA+

Executive townhomes/twinhomes 2,000+ sq. ft. 4.0-6.0 DU/Acre3 BR+ | 2BA+

Detached Townhome 2,000+ sq. ft. 4.0-6.0 DU/Acre3 BR+ | 2BA+

Condominums 800 to 1,700 sq. ft. Low-rise: 18.0-24.0 DU/Acre1-2 BR | 1-2 BA Mid-rise: 25.0+ DU/Acre

Hi-rise: 75.0+ DU/Acre

Apartment-style rental housing 675 to 1,250 sq. ft. Low-rise: 18.0-24.0 DU/Acre1-3 BR | 1-2 BA Mid-rise: 25.0+ DU/Acre


Townhome-style rental housing 900 to 1,700 sq. ft. 8.0-12.0 DU/Acre2-4 BR | 2BA

Student rental housing 550 to 1,400 sq. ft. Low-rise: 18.0-24.0 DU/Acre1-4BR | 1-2 BA Mid-rise: 25.0+ DU/Acre


Senior housing 550 to 1,500 sq. ft. Varies considerably based onSuites - 2BR | 1-2 BA senior product type


TYPICAL HOUSING TYPE CHARACTERISTICS

Housing Types

First-time buyers: Singles, couples,

First-time buyers: Families, couples w/no children, some singles

Step-up buyers: Families, couples w/no children

Step-up buyers: Families, couples w/no children

For-

Sale

Hou

sing

Rent

al H

ousi

ngBo

th

Single-parents, families w/children, empty nesters

Retirees, Seniors

Singles, couples, single-parents, some families, seniors

First-time & step-up buyers: Singles, couples, some families, empty-nesters

College students, mostly undergraduates

Step-up buyers: Empty-nesters, retirees

Step-up buyers: Empty-nesters, retirees, some families

First-time & step-up buyers: Singles, couples, empty-nesters, retirees

First-time & move-down buyers: Families, couples w/no children, empty nesters, retirees

Demographics Demographics are major influences that drive housing demand. Household growth and for-mations are critical (natural growth, immigration, etc.), as well as household types, size, age of householders, incomes, etc. Economy & Job Growth The economy and housing market are intertwined; the health of the housing market affects the broader economy and vice versa. Housing market growth depends on job growth (or the pro-spect of); jobs generate income growth which results in the formation of more households and can stimulate household turnover. Historically low unemployment rates have driven both exist-ing home purchases and new-home purchases. Lack of job growth leads to slow or diminishing household growth, which in-turn relates to reduced housing demand. Additionally, low income



growth results in fewer move-up buyers which results in diminished housing turnover across all income brackets. Consumer Choice/Preferences A variety of factors contribute to consumer choice and preferences. Many times a change in family status is the primary factor for a change in housing type (i.e. growing families, empty-nest families, etc.). However, housing demand is also generated from the turnover of existing households who decide to move for a range of reasons. Some households may want to move-up, downsize, change their tenure status (i.e. owner to renter or vice versa), or simply move to a new location. Supply (Existing Housing Stock) The stock of existing housing plays a crucial component in the demand for new housing. There are a variety of unique household types and styles, not all of which are desirable to today’s con-sumers. The age of the housing stock is an important component for housing demand, as communities with aging housing stocks have higher demand for remodeling services, replace-ment new construction, or new home construction as the current inventory does not provide the supply that consumers seek. Pent-up demand may also exist if supply is unavailable as householders postpone a move until new housing product becomes available. Housing Finance Household income is the fundamental measure that dictates what a householder can afford to pay for housing costs. According to the U.S. Department of Housing and Urban Development (HUD), the definition of affordability is for a household to pay no more than 30% of its annual income on housing (including utilities). Families who pay more than 30% of their income for housing (either rent or mortgage) are considered cost burdened and may have difficulty afford-ing necessities such as food, clothing, transportation and medical care. The ability of buyers to obtain mortgage financing has been increasingly challenging over the past few years as lenders have overcorrected from the subprime mortgage crisis. As a result, many borrowers have remained on the sidelines as lenders have enforced tight lending re-quirements, thereby increasing the demand for rental housing. Mobility It is important to note that demand is somewhat fluid between other southeastern Minnesota communities and will be impacted by development activity in nearby areas, including other communities outside Wabasha County.



Estimated Demand for For-Sale Housing Table HD-1 presents our demand calculations for general occupancy for-sale housing in the Plainview Market Area between 2014 and 2025. Between 2014 and 2025, the Plainview Market Area is projected to add 391 new households. Because the 65 and older cohort is typically not a target market for new general occupancy for-sale housing, we limit demand from household growth to only those households under the age of 65. Based on our analysis of household growth forecast in specific age cohorts, we estimate that only 74% (289 households) will be added from non-senior households. Demand for housing is apportioned between ownership and rental housing products. According to historic U.S. Census data, approximately 83.2% of households under age 65 owned their housing in 2010 in the Plainview Market Area. Applying this percentage to the total demand for general occupancy units yields demand for 240 for-sale units between 2014 and 2025. Demand is also forecast to emerge from existing Market Area householders through turnover. An estimated 1,875 owner-occupied households are located in the Plainview Market Area in 2014. Based on mobility data from the Census Bureau, an estimated 50% of owner households will turnover in a ten-year period, resulting in 938 existing households projected to turnover. Finally, we estimate 9% of the existing owner households will seek new for-sale housing, resulting in demand for 84 for-sale units through 2025. Next, we estimate that 15% of the total demand for new for-sale units in the Plainview Market Area will come from people currently living outside of the Market Area. A portion of this mar-ket will be former residents of the area, such as “snow-birds” heading south for the winters. Adding demand from outside the Plainview Market Area to the existing demand potential, re-sults in a total estimated demand for 382 for-sale housing units by 2025. Based on land available, building trends, and demographic shifts (increasing older adult popula-tion), we project 75% of the for-sale owners will prefer traditional single-family product types while the remaining 25% will prefer a maintenance-free multi-family product (i.e. twin homes, townhomes, or condominiums). We then subtract the current identified platted lots that are under construction or approved. After subtracting the current Plainview lot supply in subdivisions (14 single-family lots and 21 multifamily lots) we find total demand through 2025 resulting in 273 single-family lots and 75 multifamily units. Finally, we estimate that 45% of the excess single family demand and 70% of the excess multifamily demand from the Plainview Market Area demand could be captured in Plainview. Therefore, total for-sale demand in Plainview through 2025 is 123 single-family units and 52 multifamily units.



Projected HH growth under age 65 in the Plainview Market Area 2014 to 2025¹(times) % propensity to own2 x(equals) Projected demand from new HH growth =

Number of owner households (age 64 and younger) in Plainview Market Area (2014)3

(times) Estimated percent of owner turnover4 x(equals) Total existing households projected to turnover =

(times) Estimated percent desiring new housing x(equals) Demand from existing households

(equals) Total demand from HH growth and existing HHs 2014 to 2025 =

(times) Demand from outside Plainview Market Area(equals) Total demand potential for ownership housing, 2014 to 2025

(times) Percent desiring for-sale single-family vs. multifamily5 x 75% 25%(equals) Total demand potential for new single-family & multifamily for-sale housing = 287 96

(minus) Units under construction or approved platted lots (undeveloped and developed lots)6 - 14 21(equals) Excess demand for new general occupancy for-sale housing = 273 75

(times) Percent of Market Area demand capturable by Plainview x 45% 70%(equals) number of units supportable by the City of Plainview 123 52

2 Pct. of owner households under the age of 65 (U.S. Census - 2010, ESRI, Maxfield Research Inc.).3 Estimate based on 2010 owner households and new owner household growth 2010 to 2014 (under age 65)4 Based on on turnover from 2010 American Community Survey for households moving over 10-year period.5 Based on preference for housing type and land availability

* Multi-family demand includes demand for townhomes, twinhomes, and condominium units.


1 Estimated household growth based on data from Table D-3 as adjusted by Maxfield Research Inc.

6 Approved platted lot data does not account for the scattered lot supply which includes individual lots and lots in older non-marketing subdivisions.

9%84

325

15%382

Single Family

Multi-family*

938

TABLE HD-1FOR-SALE HOUSING DEMAND


Demand from Projected Household Growth289

83.2%240

Demand from Existing Owner Households1,87550%



Estimated Demand for General-Occupancy Rental Housing Table HD-2 presents our calculation of general-occupancy rental housing demand in the Plainview Market Area. This analysis identifies potential demand for rental housing that is gen-erated from both new households and turnover households. A portion of the demand will be drawn from existing households in Plainview that want to upgrade their housing situations. Between 2014 and 2025, the Plainview Market Area is projected to add 391 new households. Because the 65 and older cohort is typically not a target market for new general occupancy rental housing, we limit demand from household growth to only those households under the age of 65. Based on our analysis of household growth forecast in specific age cohorts, we esti-mate that 289 households will be added from non-senior households. Demand for housing is apportioned between ownership and rental housing products. According to historic U.S. Census data, approximately 17% of households under age 65 rented their housing in 2010 in the Plainview Market Area. Applying this percentage to the total demand for general occupancy units yields demand for 49 rental units between 2014 and 2025. Demand is also forecast to emerge from existing Market Area householders through turnover. An estimated 379 renter-occupied households are located in the Plainview Market Area in 2014. Based on mobility data from the Census Bureau, an estimated 79.4% of renter households will turnover in a ten-year period, resulting in 301 existing households projected to turnover. Finally, we estimate 15% of the existing renter households will seek new rental housing, resulting in demand for nearly 45 rental units through 2025. Next, we estimate that 15% of the total demand for new rental units in the Plainview Market Area will come from people currently living outside of the Market Area. Adding demand from outside the Plainview Market Area to the existing demand potential, results in a total estimated demand for 110 rental housing units by 2025. Based on a review of rental household incomes and sizes and monthly rents at existing projects, we estimate that approximately 20% of the total demand will be for subsidized housing (30% AMI), 22% will be for affordable housing (40% to 60% AMI), and 58% will be for market rate housing (non-income restricted). Next we subtract housing projects that are under construction or pending at this time, since these projects will satisfy some of the calculated demand for general occupancy rental housing. However, there are no pending projects at this time. Therefore, there is demand in the Plainview Market Area for 22 subsidized units, 24 affordable units, and 64 market rate units through 2025. Finally, we estimate that a site in Plainview can capture 75% of the total Market Area de-mand, resulting in demand for 17 subsidized units, 18 affordable units, and 48 market rate units in Plainview.



Projected HH growth under age 65 in the Plainview Market Area 2014 to 2025¹(times) Estimated % to be renting their housing2 x(equals) Projected demand from new HH growth =

Number of renter HHs (age 64 and younger) in Plainview Market Area (2014)3

(times) Estimated percent of renter turnover4 x(equals) Total existing households projected to turnover =

(times) Estimated percent desiring new rental housing x(equals) Demand from existing households

(equals) Total demand from HH growth and existing HHs 2014 to 2025 =

(times) Demand from outside Plainview Market Area(equals) Total demand potential for rental housing, 2014 to 2025

Subsidized Affordable Market Rate

(times) Percent of rental demand by product type5 x 20% 22% 58%(equals) Total demand potential for general-occupancy rental housing units = 22 24 64

(minus) Units under construction or pending6 - 0 0 0(equals) Excess demand for new general occupancy rental housing = 22 24 64

(times) Percent of Market Area demand capturable by Plainview x 75% 75% 75%(equals) number of units supportable by the City of Plainview 17 18 48

2 Pct. of renter households under the age of 65 (U.S. Census - 2010, ESRI, Maxfield Research Inc.).3 Estimate based on 2010 renter households and new renter household growth 2010 to 2014 (under age 65)4 Based on on turnover from 2010 American Community Survey for households moving over 10-year period.5 Based on the combination of current rental product and household incomes of area renters (non-senior households)


6 Pending/proposed/under construction at 95% occupancy.

15%45

94

15%110

1 Estimated household growth based on data from Table D-3 as adjusted by Maxfield Research Inc.

301

TABLE HD-2RENTAL HOUSING DEMANDPLAINVIEW MARKET AREA

2014 to 2025

Demand from Projected Household Growth289

16.8%49

Demand from Existing Renter Households379

79.4%

It should be noted demand could be higher to account for pent-up housing demand. With pent-up demand (a shortage of units), people who would normally form their own rental households instead room with other persons in a housing unit, live with their parents, live in single-family rentals, or live in housing outside of the area and commute to jobs.



Estimated Demand for Independent Adult/Few Service Senior Housing Table HD-3 presents our demand calculations for market rate independent senior housing in Plainview in 2014 and 2020. In order to determine demand for independent senior housing, the potential market is reduced to those households that are both age and income qualified. The age-qualified market is de-fined as seniors age 55 and older, although independent living projects will primarily attract seniors age 65 and older. We calculate that the minimum income needed to afford monthly rents is $35,000 or more plus homeowner households with incomes between $25,000 and $34,999 who would be able to supplement their incomes with the proceeds from a home sale. We estimate the number of age/income-qualified senior households in the Plainview Market Area in 2014 to be 978 house-holds. Adjusting to include appropriate long-term capture rates for each age cohort (0.5% of house-holds age 55 to 64, about 5.5% of households age 65 to 74, and 16.5% of households age 75 and over) results in a market rate demand potential for 50 independent senior rental units in 2014. Some additional demand will come from outside the Plainview Market Area. We estimate that 15% of the long-term demand for independent senior housing will be generated by seniors cur-rently residing outside the Plainview Market Area. This demand will consist primarily of parents of adult children living in the Plainview area, individuals who live just outside of the Plainview Market Area and have an orientation to the area, as well as former residents who desire to re-turn. Together, the demand from Plainview Market Area seniors and demand from seniors who would relocate to Plainview results in a demand for 58 active adult units in 2014. Independent demand in Plainview is apportioned between ownership and rental housing. Based on the age distribution, homeownership rates and current product available in Plainview, we project that 35% of Plainview’ demand will be for adult ownership housing (20 units) and 65% will be for rental housing (38 units).



55-64 65-74 75+ 55-64 65-74 75+

# of Households w/ Incomes of >$35,0001 476 237 147 559 326 165

# of Households w/ Incomes of $25,000 to $34,9991 + 34 48 64 34 45 55(times ) Homeownership Rate x 90% 87% 72% x 90% 87% 72%(equals) Total Potential Market Base = 507 279 193 = 590 365 205

(times) Potential Capture Rate x 0.5% 5.5% 16.5% x 0.5% 5.5% 16.5%(equals) Demand Potential = 3 15 32 = 3 20 34

Potential Demand from Plainview Residents = 50 = 57

(plus) Demand from Outside Plainview MA (15%) + 9 + 10(equals) Total Demand Potential = 58 = 67

Owner- Renter- Owner- Renter-Occupied Occupied Occupied Occupied

(times) % by Product Type x 35% x 65% x 35% x 65%(equals) Demand Potential by Product Type = 20 = 38 = 23 = 43

(minus) Existing and Pending MR Active Adult Units2 - 0 - 0 - 0 - 0(equals) Excess Demand for MR Active Adult Units = 20 = 38 = 23 = 43

(times) Percent that could be captured in Plainview x(equals) Excess market rate active adult demand in Plainview = 14 27 16 30


70%70%

² Existing and pending are deducted at market equilibrium (95% occupancy).

2020Age of Householder Age of Householder

2014

TABLE HD-3MARKET RATE ACTIVE ADULT HOUSING DEMAND


1 2020 calculations define income-qualified households as all households with incomes greater than $40,000 and homeowner households with incomes between $30,000 and $39,999.

Next, we subtract existing competitive market rate units (minus a vacancy factor of 5% to allow for sufficient consumer choice and turnover) from the owner and rental demand. However, there are no existing competitive market rate units at this time. No one community, including Plainview, would be able to capture 100% of the demand. Since Plainview is the largest community in the Market Area, we believe that it can capture 70% of the demand for ownership projects and rental projects. This results in total demand for 14 adult owner-occupied units and 27 adult rental units in Plainview in 2014. Adjusting for inflation, we have estimated that households with incomes of $40,000 or more and homeowners with incomes of $30,000 to $39,999 would income qualify for market rate in-dependent senior housing in 2020. Considering the growth in the older adult base and the in-come distribution of the older adult population in 2020, the methodology projected that de-mand will be 16 adult owner-occupied units and 30 adult rental units in the City of Plainview by 2020.



Estimated Demand for Subsidized/ Affordable Independent Senior Housing Table HD-4 presents our demand calculations for subsidized/affordable independent senior housing in the City of Plainview in 2014 and 2020. While the methodology used to calculate demand for subsidized/affordable housing closely mirrors the methodology used to calculate demand for market rate housing, we make several adjustments to more precisely quantify demand among this market segment. The following points summarize these adjustments: • Income-Qualifications: Seniors who earn up to 60% of the Area Median Income (AMI)

would be qualified for income-restricted housing products. Based on Minnesota Housing Finance Agency data, current income-restrictions for the upper end of the range for afford-able housing (60% AMI) are $28,980 for a one-person households and $33,120 for a two-person household. It is important to note that individual affordable developments may have unique income-guidelines that are more precise than these income-restrictions due to subsidy type or other factors.

We exclude homeowner households with incomes between $30,000 and $39,999, as these

households would have additional equity that could be converted to monthly income fol-lowing the sales of their single-family homes.

• Capture Rates: Households in a need-based situation (either requiring services or financial assistance) more readily move to housing alternatives than those in non-need based situa-tions. Hence, the capture rate among each age group is higher than for market rate hous-ing. Capture rates are employed at 2.0% for households age 55 to 64, 10.0% for house-holds age 65 to 74 and 20.0% for households age 75 and older.

• Potential Demand Capture: Seniors in need-based situations are less selective when secur-

ing housing than those in non-need based situations. We estimate that a high-quality site would capture a greater proportion of total demand for financially-assisted housing than for market rate housing.

Using the methodology described above results in a demand potential for 33 subsidized units and 22 affordable units. Next we subtract existing competitive units from the overall demand. There are 40 existing subsidized independent units in the Market Area (minus a vacancy factor of 3% to allow for suf-ficient consumer choice and turnover). However, there are no existing affordable independent units in the Market Area. After we subtract the existing units, there is demand for no subsi-dized and 22 independent units in 2014.



No single site can capture all of the demand in the Plainview Market Area. We estimate that a Site in Plainview could capture approximately 80% of the Market Area excess demand for a total of 18 affordable units through 2014. Adjusting for inflation, we estimate that households with incomes up to $45,000 would be can-didates for financially-assisted independent housing in 2020. We reduce the potential market by homeowner households earning between $35,000 and $44,999 that would exceed income-restrictions once equity from their home sales is converted to monthly income. Following the same methodology, we project demand in Plainview for 16 affordable units and no subsidized units through 2020.

55-64 65-74 75+ 55-64 65-74 75+

# of Households w/ Incomes of <$40,000 119 139 205 105 130 189

Less Households w/ Incomes of $30,000 to $39,9991 - 37 46 57 - 39 49 59(times ) Homeownership Rate x 90% 87% 72% x 90% 87% 72%

(equals) Total Potential Market Base = 86 99 164 = 70 87 147

(times) Potential Capture Rate x 2.0% 10.0% 20.0% x 2.0% 10.0% 20.0%(equals) Demand Potential = 2 10 33 = 1 9 29

(equals) Potential Demand from Plainview Residents = 44 39

+ 11 + 10= 56 = 49

Subsidized Affordable Subsidized Affordable(times) % by Product Type x 60% x 40% x 60% x 40%(equals) Demand Potential by Product Type = 33 = 22 = 30 = 20

(minus) Existing and Pending Independent Units2 - 39 - 0 - 39 - 0(equals) Excess Demand for Aff/Sub Units = -6 = 22 = -9 = 20

(times) Percent that could be captured in Plainview x(equals) Excess sub/aff independent demand in Plainview = 0 18 0 16


80% 80%

² Existing units are deducted at market equilibrium, or 97% occupancy.

TABLE HD-4SUBSIDIZED/AFFORDABLE INDEPENDENT HOUSING DEMAND


2014 2020Age of Householder Age of Householder

(plus) Demand from Outside Plainview MA (20%)(equals) Total Demand Potential

¹ 2020 calculations define income-qualified households as all households with incomes less than $45,000. Homeowner households with incomes between $35,000 and $44,999 are excluded from the market potential for financially-assisted housing.



Estimated Demand for Congregate Senior Housing Table HD-5 presents our demand calculations for congregate housing in Plainview in 2014 and 2020. The potential age- and income-qualified base for congregate senior housing includes all senior (65+) households with incomes of $35,000 as well as homeowner households with incomes be-tween $30,000 and $34,999 who would qualify with the proceeds from the sales of their homes. The proportion of eligible homeowners is based on the 2010 Census homeownership rates of the Plainview Market Area seniors. The number of age, income, and asset-qualified households in Plainview is estimated to be 428 households in 2014. Demand for congregate housing is need-drive, which reduces the qualified market to only the portion of seniors who need some assistance. Adjusting to include appropriate capture rates for each age cohort (1.5% of households age 65 to 74 and 13.0% of households age 75 and old-er) results in a local demand potential for 26 congregate units in 2014. We estimate that seniors currently residing outside of the Plainview area will generate 15% of the demand for congregate senior housing. Together, the demand from Plainview Market Area seniors and demand from seniors who are willing to locate to the Plainview Market Area totals 31 congregate units in 2014. Next we subtract existing competitive units from the overall demand (minus a vacancy factor of 5% to allow for sufficient consumer choice and turnover). There are 18 existing congregate units in the Market Area. After we subtract the existing units, there is demand for 14 congre-gate in 2014. No single site can capture all of the demand in the Plainview Market Area. We estimate that a Site in Plainview could capture approximately 80% of the Market Area excess demand for a total of 11 congregate units in 2014. Adjusting for inflation, we estimate that households with incomes of $40,000 or more and sen-ior homeowners with incomes between $35,000 and $39,999 would qualify for congregate housing in 2020. Following the same methodology, demand is calculated to increase slightly to 14 units through 2020.



# of Households w/ Incomes of >$35,000¹

# of Households w/ Incomes of $30,000 to $34,999¹ + +(times) Homeownership Rate x x(equals) Total Potential Market Base = =

(times) Potential Capture Rate² x x(equals) Potential Demand = + = +

Potential Demand from PMA Residents = =

(plus) Demand from Outside Market Area (15%) + +(equals) Total Demand Potential = =

(minus) Existing and Pending Congregate Units³ - -(equals) Total Congregate Demand Potential = =

(times) Percent that could be captured in Plainview x(equals) Excess market rate assisted living demand in Plainview =


17 1714 18

¹ 2020 calculations define income-qualified households as all households with incomes greater than $40,000 and homeowner households with incomes between $35,000 and $39,999.2 The potential capture rate is derived from data from the Summary Health Statistics for the U.S. Population: National Health Interview Survey, 2008 by the U.S. Department of Health and Human Services. The capture rate used is the percentage of seniors needing assistance with IADLs, but not ADLs (seniors needing assistance with ADLs typcially need assistance with multiple IADLs and are primary candidates for service-intensive assisted living).³ Competitive units include congregate units at 95% occupancy (market equilibrium).

80% 80%11 14

26 29

5 531 35

1.5% 13.0% 1.5% 13.0%4 22 5 24

87% 72% 87% 72%258 170 347 186

326 165

24 32 24 29

TABLE HD-5MARKET RATE CONGREGATE RENTAL HOUSING DEMAND


2014 2020Age of Householder Age of Householder

65-74 75+ 65-74 75+

237 147

Demand Estimate for Assisted Living Housing Table HD-6 presents our demand calculations for assisted living senior housing in Plainview in 2014 and 2020. This analysis focuses on the potential private pay/market rate demand for assisted living units. The availability of more intensive support services such as meals, housekeeping and personal care at assisted living facilities usually attracts older, frailer seniors. According to the 2009 Overview of Assisted Living (which is a collaborative research project by the American Association of Homes and Services for the Aging, the American Seniors Housing Association, National Center for Assisted Living, and National Investment Center for the Seniors Housing and Care Industry), the average age of residents in freestanding assisted living facilities was 87 years in 2008. Hence, the age-qualified market for assisted living is defined as seniors ages 75 and over, as we estimate that of the half of demand from seniors under age 87, almost all would be



from seniors over age 75. In 2014, there were 472 seniors age 75 and older in the Plainview Market Area. Demand for assisted living housing is need-driven, which reduces the qualified market to only the portion of seniors who need assistance. According to a study completed by the U.S. Census Bureau (1999 panels of the Survey of Income and Program Participation (SIPP) files), 30% of seniors needed assistance with everyday activities (from 25.5% of 75-to-79-year-olds, to 33.6% of 80-to-84-year-olds and 51.6% of 85+ year olds). Applying these percentages to the senior population yields a potential assisted living market of 174 seniors in the Plainview Market Area. Due to the supportive nature of assisted living housing, most daily essentials are included in monthly rental fees, which allow seniors to spend a higher proportion of their incomes on housing with basic services. Therefore, the second step in determining the potential demand for assisted living housing in the Plainview Market Area is to identify the income-qualified market based on a senior’s ability to pay the monthly rent. We consider seniors in households with incomes of $40,000 or greater to be income-qualified for assisted living senior housing in the Plainview Market Area. Households with incomes of $40,000 could afford monthly assisted living fees of $3,000 by allocating 90% of their income toward the fees. According to the 2009 Overview of Assisted Living, the average arrival income of assisted living residents in 2008 was $27,260, while the average annual assisted living fee was $37,281 ($3,107/month). This data highlights that seniors are spending down assets to live in assisted living and avoid institutional care. Thus, in addition to households with incomes of $30,000 or greater, there is a substantial base of senior households with lower incomes who income-qualify based on assets – their homes, in particular. Seventy-two percent of the age 75+ households in the Plainview Market Area are homeowners, and the median resale price of homes through 2013 in Plainview was $140,000. Seniors selling their homes for the median resale price would generate about $130,200 in proceeds after sell-ing costs. With an average monthly fee of $2,500, these proceeds would last just over 4 years in an assisted living facility, which is slightly higher than the average length of stay in assisted living (27 months according to the 2009 Overview of Assisted Living). For each age group in Ta-ble HD-7, we estimate the income-qualified percentage to be all seniors in households with in-comes above $40,000 (who could afford monthly rents of $3,500+ per month) plus 40% of the estimated seniors in homeowner households with incomes below $40,000 (who will spend down assets, including home-equity, in order to live in assisted living housing). This results in a total potential market of 96 units from the Plainview Market Area in 2014.



Percent PercentNeeding Needing

Age group People Assistance¹ People Assistance¹75 - 79 173 25.5% 192 25.5%80 - 84 137 33.6% 128 33.6%85+ 162 51.6% 160 51.6%Total 472 480

Percent Income-Qualified2

Total potential market(times) Percent living alone x(equals) Age/income-qualified singles needing assistance =

(plus) Proportion of demand from couples (12%)³ +(equals) Total age/income-qualified market needing assistance =

(times) Potential penetration rate4 x(equals) Potential demand from PMA residents =

(plus) Proportion from outside the PMA (15%) +(equals) Total potential assisted living demand =

(minus) Existing market rate assisted living units5 -(equals) Total excess market rate assisted living demand =

(times) Percent that could be captured in Plainview x(equals) Excess market rate assisted living demand in Plainview =


2 Includes households with incomes of $40,000 or more (who could afford monthly rents of $2,800+ per month) plus 40% of estimated owner households with incomes below $40,000 (who will spend down assets, including home-equity, in order to live in assisted living housing).3 The 2009 Overview of Assisted Living (a collaborative project of AAHSA, ASHA, ALFA, NCAL & NIC) found that 12% of assisted living residents are couples.4 We estimate that 60% of the qualified market needing assistance with ADLs could either remain in their homes or reside at less advanced senior housing with the assistance of a family member or home health care, or would need greater care provided in a skilled care facility.5 Existing and pending units at 93% occupancy. We exclude 20% of units to account for seniors utilizing public subsidy.

1 The percentage of seniors unable to perform or having difficulting with ADLs, based on the publication Health, United States, 1999 Health and Aging Chartbook, conducted by the Centers for Disease Control and Prevention and the National Center for Health Statistics.

80% 80%11 11

14 1414 14

4 428 28

40% 40%23 24

7 759 60

96 9854% 54%52 53

174 175

55% 56%

84 83

Number NumberNeeding Needing

Assistance1 Assistance1

44 4946 43

TABLE HD-6MARKET RATE ASSISTED LIVING DEMAND


2014 2020



Because the vast majority of assisted living residents are single (88% according to the 2009 Overview of Assisted Living), our demand methodology multiplies the total potential market by the percentage of seniors age 75+ in the Plainview Market Area living alone. Based on 2010 Census data, 54% of age 75+ households in Plainview lived alone. Applying this percentage results in a total base of 52 age/income-qualified singles. The 2009 Overview of Assisted Living found that 12% of residents in assisted living were couples. There are a total of 59 age/income-qualified seniors needing assistance in the Plainview Market Area including both couples and singles. We estimate that roughly 60% of the qualified market needing significant assistance with Activities of Daily Living (“ADLs”) would either remain in their homes or less service-intensive senior housing with the assistance of a family member or home health care, or would need greater care provided in a skilled care facility. The remaining 40% could be served by assisted living housing. Applying this potential market penetration rate of 40% results in demand for 23 assisted living units in 2014. We estimate that a portion of demand for assisted living units (15%) will come from outside of the Plainview Market Area. Applying this figure results in total potential demand for 28 market rate assisted living units in the Plainview Market Area. There are a total of 18 assisted living units in the Plainview Market Area. However, a portion of these units are occupied by residents with financial assistance, estimated to account for 20% of the total units in the Market Area. After deducting these competitive units (minus a 93% occupancy rate) from the total demand potential, there is a demand for 14 assisted living units in the Plainview Market Area. No single site can capture all of the demand in the Plainview Market Area. We estimate that a Site in Plainview could capture approximately 80% of the Market Area excess demand for a total of 11 assisted living units in 2014. Additional demand could come from seniors that will need to receive supplemental income in order to afford assisted living or memory care housing. While some of these seniors will re-ceive income from the sales of their homes, others will need to rely on other sources of public aid. The Elderly Waiver program in Minnesota has provided public funding for seniors who wish to receive “alternative” care that allows them to stay in the community as opposed to receiving similar care at a nursing home. Most assisted living developments require residents to have lived in their facility for a certain amount of time before they can use a waiver, and many try to limit the amount of waivers ac-cepted within the community to around roughly 10% to 20%. Some facilities accept higher amounts of residents on waivers and many newer facilities do not accept any waivers.



Estimated Demand for Memory Care Housing Table HD-7 presents our demand calculations for market rate memory care senior housing in Plainview in 2014 and 2020. Demand is calculated by starting with the estimated Plainview Market Area senior (age 65+) population in 2014 and multiplying by the incidence rate of Alzheimer’s/dementia among this population’s age cohorts. According to the Alzheimer’s Association (Alzheimer’s Disease Facts and Figures, 2007), 2% of seniors ages 65 to 74, 19% of seniors ages 75 to 84, and 42% of sen-iors ages 85+ are inflicted with Alzheimer’s Disease. This yields a potential market of 138 sen-iors in the Plainview Market Area in 2014. Because of the staff-intensive nature of dementia care, typical monthly fees for this type of housing are at least $4,000 and range upwards of $5,000 when including service packages. Based on our review of senior household incomes in the Plainview Market Area, homeowner-ship rates and home sale data, we estimate that 43% of seniors in the Plainview Market Area would have incomes and/or assets to sufficiently cover the costs of memory care housing. This figure takes into account married couple households where one spouse may have memory care needs and allows for a sufficient income for the other spouse to live independently. Multiply-ing the number of seniors with Alzheimer’s/dementia (138 seniors) by the income-qualified percentage results in a total of 59 age/income-qualified seniors in the Plainview Market Area in 2014. According to data from the National Institute of Aging, about 25% of all individuals with memory care impairments comprise the market for memory care housing units. This figure considers that seniors in the early stages of dementia will be able to live independently with the care of a spouse or other family member, while those in the later stages of dementia will re-quire intensive medical care that would only be available in skilled care facilities. Applying this figure to the estimated population with memory impairments yields a potential market of about 15 seniors in the Plainview Market Area. We estimate that 15% of the overall demand for memory care housing would come from out-side of the Plainview Market Area. Together, demand totals 17 memory care units in 2014.



65 to 74 Population 568 730(times) Dementia Incidence Rate¹ x 2% x 2%(equals) Estimated Age 65 to 74 Pop. with Dementia = 11 = 15

75 to 84 Population 310 318(times) Dementia Incidence Rate¹ x 19% x 19%(equals) Estimated Age 75 to 84 Pop. with Dementia = 59 = 60

85+ Population 162 158(times) Dementia Incidence Rate¹ x 42% x 42%(equals) Estimated Age 85+ Pop. with Dementia = 68 = 66

(equals) Total Senior Population with Dementia = 138 = 141

(times) Percent Income/Asset-Qualified² x 43% x 48%(equals) Total Income-Qualified Market Base = 59 = 68

(times) Percent Needing Specialized Memory Care Assistance x 25% x 25%(equals) Total Need for Dementia Care = 15 = 17

(plus) Demand from Outside the PMA (15%) + 3 + 3Total Demand for Memory Care Units = 17 20

(minus) Existing and Pending Memory Care Units3 - 0 - 0(equals) Excess PMA Demand Potential = 17 = 20

(times) Estimated Percent Capturable in Plainview x 80% 80%(equals) Memory Care Demand Capturable in Plainview = 14 16


¹ Alzheimer's Association: Alzheimer's Disease Facts & Figures (2007)² Includes seniors with income at $60,000 or above ($65,000 in 2020) plus 40% of homeowners with incomes below this threshold (who will spend down assets, including home-equity, in order to live in memory care housing.3 Existing memory care units at 7% vacancy rate. We exclude 20% of units to account for seniors utilizing public subsidy.

TABLE HD-7MARKET RATE MEMORY CARE DEMAND


2014 2020

We reduce the demand potential by accounting for the existing memory care product in the Plainview Market Area. There are no memory care units in the Plainview Market Area. No single site can capture all of the demand in the Plainview Market Area. We estimate that a Site in Plainview could capture approximately 80% of the Plainview Market Area excess demand for a total of 14 memory care units in 2014. The same calculations are applied to the age/income-qualified base in 2020. Following the same methodology, potential demand for market rate memory care units is expected to increase to 16 units in Plainview through 2020.

RECOMMENDATIONS AND CONCLUSIONS


Introduction/Overall Housing Recommendations This section summarizes demand calculated for specific housing products in Plainview and rec-ommends development concepts to meet the housing needs forecast for the City. All recom-mendations are based on findings of the Comprehensive Housing Market Analysis. The follow-ing table and charts illustrate calculated demand by product type.

Type of Use

General-OccupancyRental Units - Market RateRental Units - AffordableRental Units - SubsidizedFor-Sale Units - Single-familyFor-Sale Units - Multifamily

Total General Occupancy Supportable

2014 2020 2014 2020Age-Restricted (Senior)Market RateAdult Few Services (Active Adult) 58 66 41 46

Ownership 20 23 14 16 Rental 38 43 27 30

Congregate 14 18 11 14Assisted Living 14 14 11 11Memory Care 17 20 14 16Total Market Rate Senior Supportable 103 118 77 87

Affordable/SubsidizedActive Adult - Subsidized 0 0 0 0Active Adult - Affordable 22 20 18 16Total Affordable Senior Supportable 22 20 18 16


12352

TABLE CR-1SUMMARY OF HOUSING DEMAND


Demand in Market Area

Demand in Market Area Demand in Plainview

Demand in Plainview2014-2025 2014-2025

458

642422

27375

258

481817

Based on the finding of our analysis and demand calculations, Table CR-2 provides a summary of the recommended development concepts by product type for the City of Plainview. It is im-portant to note that these proposed concepts are intended to act as a development guide to most effectively meet the housing needs of existing and future households in Plainview. The recommended development types do not directly coincide with total demand as illustrated in Table CR-1.



48

18

17

123

52

0 20 40 60 80 100 120 140

Rental - Market

Rental - Aff

Rental - Subs.

For-Sale - SF

For-Sale - MF

Units

General-Occupancy Demand by Type - Plainview2014 to 2025

0

16

16

11

14

30

16

0

18

14

11

11

27

14

0 10 20 30 40

Subsidized

Affordable

Memory Care

Assisted Living

Congregate

Adult - Rental

Adult - Owner

Units

Senior Housing Demand by Type - Plainview2014 & 2019

2014 2019



Purchase Price/ Pct. DevelopmentMonthly Rent Range¹ of Total Timing

Owner-Occupied HomesSingle Family 2

Entry-level >$160,000 22 - 24 19% 2016+Move-up $160,000 - $225,000 50 - 52 43% 2015+Executive $250,000+ 44 - 46 38% 2016+

Total 116 - 122 100%Townhomes/Twinhomes 2

Entry-level >$150,000 18 - 20 39% 2016+Move-up $175,000+ 28 - 32 61% 2016+

Total 46 - 52 100%

Total Owner-Occupied 162 - 174

General Occupancy Rental Housing Market Rate Rental Housing

Apartment-style $625/1BR - $950/3BR 20 - 24 44% 2016+ Townhomes $800/2BR - $1,100/3BR 26 - 30 56% 2016+

Total 46 - 54 100%

Affordable Rental Housing Townhomes Moderate Income3 18 - 20 100% 2016+

Total 18 - 20 100%

Total Renter-Occupied 64 - 74

Senior Housing (i.e. Age Restricted)Active Adult Market Rate Rental $750/1BR - $1,000/2BR 26 - 30 43% 2017+

Catered Living4 $1,500/1BR - $3,500/2BR 22 - 26 37% 2016+Memory Care $3,800/EFF - $5,200/2BR 12 - 14 20% 2016+

Total 60 - 70 100%

Total - All Units 286 - 318


TABLE CR-2RECOMMENDED HOUSING DEVELOPMENT

CITY OF PLAINVIEW2015 to 2025

No. of Units

¹ Pricing in 2015 dollars. Pricing can be adjusted to account for inflation.2 Recommendations include the absorption of some existing previously platted lots.3 Affordablity subject to income guidelines per Minnesota Housing Finance Agency. See Table HA-1 for Wabasha County Income limits.4 Catered living is a hybrid concept of congregate and assisted living service levels.

Note - Recommended development does not coincide with total demand. Plainview may not be able to accommodate all recommended housing types based on a variety of factors (i.e. development constraints, land availability, etc.)



Recommended Housing Product Types Owner Occupied Single-Family Housing Table HD-1 identified demand for 273 single-family housing units in the Plainview Market Area through 2025. However, after accounting for the demand capturable in Plainview and the ex-isting 14 single-family newer lots in Plainview (see Table FS-5), demand is reduced to 123 new lots in Plainview through 2025. Based on historic construction activity since 2000, there has been an average of 13 new single-family units per year in Plainview. New single-family home construction has been rather quiet in Plainview since the Great Reces-sion. Prior to the housing bust and ensuing recession; most of the new construction outside of the Harvest Ridge Subdivision targeted move-up and executive buyers; this has also been true since the recession in part because of the high infrastructure costs in development new subdi-visions. However, our research and interviews we find demand for a variety of price points of new single-family homes. The lot supply benchmark for growing communities is a three- to five-year lot supply, which en-sures adequate consumer choice without excessively prolonging developer-carrying costs. Giv-en the number of existing platted lots in Plainview and the number of homes constructed an-nually, the current lot supply will meet the demand in the short-term, but new platted lots will soon be needed in Plainview. Although there are several scattered, infill lots throughout the City of Plainview, many of these lots are undesirable to today’s buyers as they are unable to ac-commodate specific product types (i.e. ranch-style homes with large main-levels). Due to the age and price of the existing housing stock in Plainview, most of the existing older housing stock appeals to entry-level buyers. Entry-level homes, which we generally classify as homes priced under $110,000 will be mainly satisfied by existing single-family homes as resi-dents of existing homes move into newer housing products built in the Plainview Area, such as move-up single-family homes, twinhomes, rental housing and senior housing. A move-up buyer or step-up buyer is typically one who is selling one house and purchasing another one, usually a larger and more expensive home. Usually the move is desired because of a lifestyle change, such as a new job or a growing family. Executive-level homes are loosely defined as those homes priced above $250,000. Most of these homes would be build-to-suit new construction; some of which would be attracted to larger acreages outside the city limits. Our research found demand very few available lots for new single-family construction that would target the move-up and executive level buyers. Therefore, we recommend platting new lots in the very short term to meet the demand. Although there would be strong demand for a new single-family housing product priced under $150,000, financially it will be extremely difficult to develop even with public assistance due to infrastructure costs and rising labor and material costs. Based on land and building costs, it is



very difficult to build new single-family homes for less than $200,000 today. The Harvest Ridge Subdivision has nine available lots remaining that will target first time homebuyers subject to income-guidelines. We recommend a wide-range of price points to accommodate future de-mand; which may include revising the minimum lot width requirement to achieve smaller lots that allow increased affordability for entry-level new construction buyers. We recommend considering split-level homes for first-time home buyers and move-up buyers desiring new construction at a lower price point than a ranch-style home. Typically, the split-level home is popular with families with kids as they are a more affordable housing product to develop while still offering new construction. In many markets in the Midwest, split levels can be developed from $110 per square foot to $135 per square foot; significantly less than the ranch-style home. This is in part because the lot widths are smaller and many of these homes feature about 1,000 finished square feet with an unfinished basement.

Split Level Examples

Split-level (980 sq. ft. + unfinished bsmt). Split-level (1,550 sq.ft. + unfinished bsmt).

2-story tuck-under 2-story tuck-under



For-Sale Multifamily Housing A growing number of households desire alternative housing types such as townhouses, twinhomes and condominiums. Typically, the target market for for-sale multifamily housing is empty-nesters and retirees seeking to downsize from their single-family homes. In addition, professionals, particularly singles and couples without children, also will seek townhomes if they prefer not to have the maintenance responsibilities of a single-family home. In some housing markets, younger households also find purchasing multifamily units to be generally more affordable than purchasing new single-family homes. Our analysis of the Plainview for-sale housing stock found very few maintenance-free products as historically buyers have preferred the single-family house. However, given the aging of the population and the high growth rate in the 55+ population, Plainview would benefit from a more diversified housing stock. Based on the changing demographics and the need for alterna-tive housing types, demand was calculated for 52 new multifamily for-sale units in Plainview through 2025. These attached units could be developed as twin homes, detached townhomes or villas, townhomes/row homes, or any combination. Because the main target market is emp-ty-nesters and young seniors, the majority of townhomes should be one-level, or at least have a master suite on the main level if a unit is two-stories. The following provides greater detail into townhome and twinhome style housing. • Twinhomes– By definition, a twin home is basically two units with a shared wall with each

owner owning half of the lot the home is on. Some one-level living units are designed in three-, four-, or even six-unit buildings in a variety of configurations. The swell of support for twinhome and one-level living units is generated by the aging baby boomer generation, which is increasing the numbers of older adults and seniors who desire low-maintenance housing alternatives to their single-family homes but are not ready to move to service-enhanced rental housing (i.e. downsizing or right sizing). Traditionally most twin home developments have been designed with the garage being the prominent feature of the home; however, today’s newer twin homes have much more ar-chitectural detail. Many higher-end twin home developments feature designs where one garage faces the street and the other to the side yard. This design helps reduce the promi-nence of the garage domination with two separate entrances. Housing products designed to meet the needs of these aging Plainview residents, many of whom desire to stay in their current community if housing is available to meet their needs, will be needed into the fore-seeable future. Twinhomes are also a preferred for-sale product by builders as units can be developed as demand warrants. Because twinhomes bring higher density and economies of scale to the construction process, the price point can be lower than stand-alone single-family housing. We recommend a broad range of pricing for twinhomes; however pricing should start at around $140,000 for an entry-level unit.



Many older adults and seniors will move to this housing product with substantial equity in their existing single-family home and will be willing to purchase a maintenance-free home that is priced similar to their existing single-family home. The twinhomes should be associ-ation-maintained with 40’- to 50’-wide lots on average.

Twinhome Examples

Standard Twinhome – garage on end Standard Twinhome – garage in middle

Executive Twinhome with alternate garages Executive-style Twinhome – front facing garage

• Detached Townhomes/Villas – An alternative to the twinhome is the one-level villa product and/or rambler. This product also appeals mainly to baby boomers and empty nesters seeking a product similar to a single-family living on a smaller scale while receiving the benefits of maintenance-free living. Many of these units are designed with a walk-out or lookout lower level if the topography warrants. We recommend lot widths ranging from 45 to 55 feet with main-level living areas between 1,600 and 1,800 square feet. The main lev-el living area usually features a master bedroom, great room, dining room, kitchen, and laundry room while offering a “flex room” that could be another bedroom, office, media room, or exercise room. However, owners should also be able to purchase the home with



the option to finish the lower level (i.e. additional bedrooms, game room, storage, den/study, etc.) and some owners may want a slab-on-grade product for affordability rea-sons. Finally, builders could also provide the option to build a two-story detached product that could be mixed with the villa product. Pricing for a detached townhome/villa will vary based on a slab-on-grade home versus a home with a basement. Base pricing should start at $175,000 and will fluctuate based on custom finishes, upgrades, etc.

Detached Townhome/Villa Examples

Cottage-style (alley-loaded garage) Executive-style – side garage entrance

Villa – Garage in front 2-story tuck-under

• Side-by-Side and Back-to-Back Townhomes – This housing product is designed with three

or four or more separate living units in one building and can be built in a variety of configu-rations. With the relative affordability of these units and multi-level living, side-by-side and back-to-back townhomes have the greatest appeal among entry-level households without



children, young families and singles and/or roommates across the age span. However, two-story townhomes would also be attractive to middle-market, move-up, and empty-nester buyers. Many of these buyers want to downsize from a single-family home into maintenance-free housing, many of which will have equity from the sale of their single-family home. Because multifamily for-sale housing is mostly untested in Plainview, we recommend a four-plex concept that could be back-to-back with main-level master bedrooms that would cater to empty-nesters. If the product is successful, future phases could include rowhomes that would increase density and cater to a broader market. Units should be priced from $130,000 to $150,000.

Townhome Examples

3-Plex (one-level living w/basement) Tuck-under garage

Row-house style Back-to-back style (6-Plex)



General Occupancy Rental Housing Maxfield Research Inc. calculated demand for 83 general-occupancy rental units in Plainview through 2025 (48 market rate, 18 affordable, and 17 subsidized units). Because of this demand, we recommend a variety of rental housing product types to meet this demand. • Market Rate Rental – There are very few traditional multifamily rental developments in

Plainview. We recommend a new market rental project with roughly 20 to 24 units that will attract a diverse resident profile; including young to mid-age professionals as well as singles and couples across all ages. To appeal to a wide target market, we suggest a market rate apartment project with a unit mix consisting of one-bedroom units, one-bedroom plus den units or two-bedroom units, and two-bedroom plus den or three-bedroom units. Larger three-bedroom units would be attractive to households with children.

Monthly rents (in 2015 dollars) should range from $650 for a one-bedroom unit to $950 for a two-bedroom den or three-bedroom unit. Average rents in Plainview are approximately $0.65 per square foot, however monthly rents should range from about $1.00 to $1.15 per square foot to be financially feasible. Monthly rents can be trended up by 2.0% annually prior to occupancy to account for inflation depending on overall market conditions. Be-cause of construction and development costs, it will be difficult for a market rate apartment to be financially feasible with rents lower than the suggested per square foot price. Thus, for this type of project to become a reality, there may need to be a public – private partner-ship to reduce development costs and bring down the rents or the developer will need to provide smaller unit sizes.

New market rate rental units should be designed with contemporary amenities that include open floor plans, higher ceilings, in-unit washer and dryer, full appliance package, central air-conditioning, and garage parking.

• Market Rate General Occupancy Rental Townhomes– In addition to the recommended apartment project, we find that demand exists for some larger townhome units for families – including those who are new to the community and want to rent until they find a home for purchase. An additional 26 to 30 rental townhome units could be supported in Plainview and phased in as demand warrants. We recommend a project with rents of ap-proximately $825 for two-bedroom units to $1,150 for three-bedroom units. Units should feature contemporary amenities (i.e. in-unit washer/dryer, high ceilings, etc.) and an at-tached two car garage.

• Affordable General Occupancy Rental Townhomes– We find that demand exists for 18 af-

fordable units through 2025. We recommend an 18 to 20-unit moderate-income afforda-ble rental townhome project to meet the affordable demand in Plainview. These projects would have income-restrictions established by HUD and the Minnesota Housing Finance Agency. Affordable rental townhomes have been found to be very popular throughout



many Minnesota rural communities and the existing Harvest Ridge Townhomes maintains a waiting list.

We recommend a project with two- and three-bedroom units. Units should feature central air conditioning, full appliance package, in-unit washer/dryer, an attached one/two car garage. Such development could assist in drawing more families to the community that cannot find affordable housing options through ownership or market rate rental in the sur-rounding area.

• Subsidized Rental Housing– Subsidized housing receives financial assistance (i.e. operating

subsidies, tax credits, rent payments, etc.) from governmental agencies in order to make the rent affordable to low-to-moderate income households Although we find demand for 17 subsidized rental housing units through 2025, this housing is very difficult to develop fi-nancially. A new subsidized or public housing development would have pent-up demand.

Senior Housing As illustrated in Table CR-1, demand exists for all types of senior housing product types in Plainview. However, due to the economies of scale need to support new development not all of the service levels will be financially viable. Development of additional senior housing is rec-ommended in order to provide housing opportunity to these aging residents in their stages of later life. The development of additional senior housing serves a two-fold purpose in meeting the housing needs in Plainview: older adult and senior residents are able to relocate to new age-restricted housing in Plainview, and existing homes and rental units that were occupied by seniors become available to other new households. Hence, development of additional senior housing does not mean the housing needs of younger households are neglected; it simply means that a greater percentage of housing need is satisfied by housing unit turnover. The types of housing products needed to accommodate the aging population base are discussed in-dividually in the following section.

• Active Adult Rental – We have projected demand for about 16 affordable and 30 market

rate active adult rental units in Plainview. Currently, there are no market rate or affordable adult rental projects in Plainview. Many of the seniors who would consider an active adult product are presently residing in general-occupancy rental housing or still residing in their single-family home. Development of this product could be in separate stand-alone facili-ties or in a mixed-income project. A mixed-income building could include a portion of units that would be affordable to seniors with incomes established by Minnesota Housing. Because active adult senior housing is not need-driven, the demand for this product type may experience delays in realizing demand if seniors decide to choose not to sell their homes or find they are unable to sell their homes. However, since the Plainview real estate market has stabilized after the housing downturn seniors should have less trouble selling



their homes and should have significant equity into the home. Therefore, an active adult rental project could be developed anytime over the next five years.

• Service-Enhanced Senior Housing or “Catered Living” - Based on our analysis, we project demand to support 14 congregate units, 11 assisted living units, and 16 memory care units through 2020. These figures are for private pay residents only and do not account for res-idents who could subsidize their housing and services through Elderly Waivers or other programs. Therefore, should waiver funds be accepted, demand that could be realized in Plainview could be greater. Due to economies of scale, it will be difficult to develop stand-alone facilities for each of that are financially feasible for congregate and assisted living housing. Therefore, we rec-ommend a senior facility that allow seniors to “age in place” and remain in the same facility in the stages of later life. Catered living is a “hybrid” senior housing concept where de-mand will come from independent seniors interested in congregate housing as well as sen-iors in need of a higher level of care (assisted living). In essence, catered living provides a permeable boundary between congregate and assisted living care. The units and spatial al-locations are undistinguishable between the two senior housing products, but residents will be able to select an appropriate service level upon entry to the facility and subsequent-ly increase service levels over time. Additionally, catered living not only appeals to single seniors but also to couples; each resident is able to select a service level appropriate for his or her level of need, while still continuing to reside together. In addition, memory care can be incorporated into the facility in a separate secured wing. For the independent/assisted living units, we recommend a total of 22 to 26 units with a mix of studio, one-bedroom, one-bedroom plus den, and two-bedroom units. Monthly rents should include a base rent and service package with additional services provided ei-ther a la carte or within care packages. Monthly rents should start at about $1,500 for congregate care and $3,500 for assisted living care.

• Memory Care Senior Housing – Memory care demand in Plainview was calculated for 16

units through 2020. At present, there are no memory care units in the Plainview Market Area. Based on our analysis, we project demand to support 12 to 14 memory care units. Memory care unit mix should be mostly studios and one-bedroom units with a few two-bedroom units for couples with base monthly rents ranging from $3,800 to $5,200. Memory care units should be located in a secured, self-contained wing located on the first floor of a building and should feature its own dining and common area amenities including a secured outdoor patio and wandering area.

The base monthly fees should include all utilities (except telephone and basic ca-ble/satellite television) and the following services:

• Three meals per day; • Weekly housekeeping and linen service;



• Two loads of laundry per week; • Weekly health and wellness clinics; • Meal assistance; • Regularly scheduled transportation; • Professional activity programs and scheduled outings; • Nursing care management; • I’m OK program; • 24-hour on site staffing; • Personal alert pendant with emergency response; and • Nurse visit every other month.

Additional personal care packages should also be available for an extra monthly charge above the required base care package. A care needs assessment is recommended to be conducted to determine the appropriate level of services for prospective residents.

Challenges and Opportunities The following were identified as the greatest challenges and opportunities for developing the recommended housing types (in no particular order – sorted alphabetically). • Affordable Housing. Tables HA-1 and HA-2 identified Wabasha County Area Median In-

comes (“AMI”) and the fair market rents by unit type. Although there are very few rental properties in Plainview, the average market rate rent averages less than $600/month and the established rents for affordable housing are higher than the market rate rental proper-ties in Plainview. As a result, a high percentage of rental housing units in Plainview are con-sidered affordable and are mostly fulfilled by existing, older rental product in the market-place. Furthermore, first-time homebuyers with good credit and a down payment can pur-chase an entry-level single-family home that would have housing costs on-par with rental housing.

• Aging Population. As illustrated in Table D-4, there is significant growth in the Plainview senior population, especially among seniors ages 65 to 74 (+19% growth between 2014 and 2020). In addition, Table D-9 shows market area homeownership rates among seniors 65+ is approximately 72%. High homeownership rates among seniors indicate there could be lack of senior housing options, or simply that many seniors prefer to live in their home and age in place. Aging in place tends to be higher in rural vs. urban settings as many rural sen-iors do not view senior housing as an alternative retirement destination but a supportive liv-ing option only when they can no longer live independently. Rural areas also tend to have healthier seniors and are also are more resistant to change. Because of the rising popula-tion of older adults, demand for alternative maintenance-free housing products should be rising. In addition, demand for home health care services and home remodeling programs to assist seniors with retrofitting their existing homes should also increase.



• Destination Medical Center. The Destination Medical Center (DMC) in Rochester is planned

to transform Rochester into a worldwide destination for medical care. The DMC is project-ed to bring 35,000 to 45,000 new jobs to the State of Minnesota over the next few decades that would result in tremendous economic impact to Olmsted County and the region. Alt-hough Rochester is the epicenter of the DMC; the southeastern Minnesota area will benefit from the initiative. Many employees will choose to live outside of Rochester for a variety of reasons; lower cost housing, smaller town living, smaller school districts, etc. Due to Plainview’s proximity to Rochester (about 30 minutes), Plainview has the potential to cap-ture a portion of household growth relocating to the region due to job creation in Roches-ter. However, other smaller communities in the region are also seeking growth from the DMC so Plainview must market itself as a community to differentiate from other communi-ties.

• Developers Carrying Costs. Due to historic lot absorption trends throughout Plainview, it is difficult to develop new single-family lots where the developer can make a profit on the land. Developing land has historically been a profitable side of the housing business prior to the Great Recession, yet is also risky if the lot inventory goes unsold and there are carrying costs. Due to raw land costs, entitlements, and the cost to develop infrastructure, develop-ers will be cautious given the lot price they could achieve. Prolonged carrying costs due to slow lot absorption are deterrents for builders and developers who must absorb project de-velopment costs until the lots are sold.

According to interviews with builders, Realtors, the minimum cost to develop a municipal lot is about $35,000 per lot plus raw land costs. Table FS-5 showed new Plainview city lots are marketing from $30,000 to $35,000 per lots. As a result, the development of new lots in Plainview will be financially challenging as the cost to develop new lots will likely exceed $40,000 per lot after all expenses. A private-public partnership may be required to develop future lots in Plainview.

• Economies of Scale. Economies of scale refers to the increase in efficiency of production as the number of goods being produced is increased. Typically, companies or organizations achieving economies of scale lower the average cost per unit through increased production since fixed costs are shared over an increased number of goods. In the housing develop-ment industry, generally the more units that are constructed the greater the efficiency. For example, larger homebuilders negotiate volume discounts in materials and subcontractors, are more efficient in the land entitlement process, leverage the power of technology, and have greater access and lower costs of capital. In multifamily housing, typically the higher the number of units equates into a lower per unit costs. Because of this, construction costs in other larger communities such as Rochester can actually be lower than found in Plainview and Wabasha County. Although Table CR-1 showcased demand for many housing products in Plainview through 2025, many of the products will require some density for the project to be finically feasible.



Because demand may not be high enough to support various stand-alone housing concepts new development may require private/public partnerships or the combination of multiple product types to ensure the project can be developed.

• Financing Barriers/Infrastructure Costs and Private/Public Partnerships. One of the key challenges facing housing development in rural communities is financing. Finding banks to finance projects is difficult as most lenders require substantial equity contributions from the developer. As discussed in the previous bullet (Developers’ Carrying Costs), developers are typically required to upfront residential subdivisions and pay for the cost of water, sewer, curb and gutter, utilities, etc. Because of the substantial cost to fund improvements, most builders/developers do not have the assets or equity to fund the project and lenders have conservative underwriting standards. Furthermore, private investors seek targeted returns on investment and liquidity that cannot be guaranteed as lot absorption/takedowns is an unknown factor. Many local jurisdictions do not have the necessary tools today to fund in-frastructure costs.

Because of this barrier, we recommend exploring other private/public partnerships to en-tice housing development. Private/public partnerships are a creative alliance formed to achieve a mutual purpose and goal. Partnerships between local jurisdictions, the private sector, and nonprofit groups can help communities develop housing products through col-laboration that otherwise may not materialize. Private sector developers can benefit through greater access to sites, financial support, and relaxed regulatory processes. Public sectors have increased control over the development process, maximize public benefits, and can benefit from and increased tax base. A number of communities have solved housing challenges through creative partnerships in a variety of formats. Many of these partnerships involve numerous funding sources and stakeholders. Because of the difficulty financing infrastructure costs in communities like Plainview, it will likely require innovative partnerships to stimulate housing development. We also recommend exploring partnerships with major employers in Plainview that could assist housing product by donating into a housing trust fund that would be designated for housing projects that would best serve workers in Plainview.

• Housing Programs. Many communities and local Housing and Redevelopment Authorities (HRAs) offer programs to promote and preserve the existing housing stock. In addition, there are various regional and state organizations that assist local communities enhance their housing stock. The following section outlines some of the key programs and services that are promoted: State/Regional Resources: Greater Minnesota Housing Fund – The Greater Minnesota Housing Fund (“GMHF”) sup-ports, preserves, and creates affordable housing in the 80 counties outside the core Twin Cities Metro Area. The GMHF provides numerous programs, financing mechanisms, tech-



nical support, and research to support production of affordable housing across Greater Minnesota. http://www.gmhf.com/

Minnesota Housing Finance Agency (“Minnesota Housing”) – Minnesota Housing is a hous-ing finance agency whose mission is to finance affordable housing for low- and moderate-income households across Minnesota. Minnesota Housing partners with for-profit, non-profit, and governmental sectors to help develop and preserve affordable housing. The or-ganization provides numerous products and services for both the single-family and multi-family housing sectors. The organizations five strategic priorities are as follows:

o Preserve federally-subsidized rental housing; o Promote and support successful homeownership; o Address specific and critical needs in rental housing markets; o Prevent and end homelessness, and; o Prevent foreclosure and support community recover.

http://www.mnhousing.gov/ Southeast Minnesota Multi-County Housing and Redevelopment Authority (“SEMMCHRA”) – SEMMCHRA is the multi-county HRA that serves the counties of Wabasha, Goodhue, Winona, and Dodge. The organization assists with providing affordable housing to housheolds earning up to 115% of the State of Minnesota median income. SEMMCHRA provides numerous programs and services to assist local residents and communities; from rental assistance, rehabilitation, low-interest loans, and the development of rental and for-sale housing. http://www.semmchra.org/index.php Three Rivers Community Action – The Three Rivers Community Action is a nonprofit human service organization that serves southeastern Minnesota. The organization services primari-ly low- and moderate-income families through a variety of programs. The organization is a non-profit housing developer and has developed and preserved a variety of housing types; including apartments, townhomes, and single-family homes. The Three Rivers Community Action partnered with the Southwest Minnesota Housing Partnership in 2008 to launch a Southern Minnesota Emerging Markets Homeownership Ini-tiative. The program was designed to identify and address barriers to homeownership from emerging market households across southern Minnesota. The program has four key ser-vices: homebuyer education classes, financial literacy classes, pre-purchase financial coun-seling sessions, and down payment/closing cost assistance programs. The Emerging Markets Gap Program offers buyer down payment and closing cost assistance to qualified households who meet all program guidelines. Funds are available on a first come, first served basis and qualified applicants can receive up to $18,500 in a deferred loan gap.

http://www.gmhf.com/

http://www.mnhousing.gov/

http://www.semmchra.org/index.php



Between 2008 and 2013, it is estimated that over 20,000 households throughout southern Minnesota have benefited from one of the housing programs and over 200 families have new homes because of the Achieve Homeownership program offered by Three Rivers Community Action. http://www.threeriverscap.org/housing/achieve-homeownership USDA Rural Development – Housing support is available through the “Housing and Commu-nity Assistance” program that is part of USDA Rural Development. The program is designed to improve housing options in rural communities and operates a variety of programs includ-ing: homeownership assistance, housing rehabilitation and preservation, rental assistance, loan administration, energy efficiency, etc. http://www.rurdev.usda.gov/IA_Home.html Local Resources: In addition to the resources available at the state and regional-level, the City of Plainview can explore a toolbox of housing programs that would aid in the enhancement of Plainview’s housing stock. The following is a sampling of potential programs that could be explored:

o Density Bonuses – Since the cost of land is a significant barrier to housing affordability,

increasing densities can result in lower housing costs by reducing the land costs per unit. The City of Plainview can offer density bonuses as a way to encourage higher-density residential development while also promoting an affordable housing component.

o Home Sale Point of Sale - City ordinance requiring an inspection prior to the sale or transfer of residential real estate. The inspection is intended to prevent adverse condi-tions and meet minimum building codes. Sellers are responsible for incurring any costs for the inspection. Depending on the community, evaluations are completed by city in-spectors or 3rd party licensed inspectors.

o Housing Fair - Free seminars and advice for homeowners related to remodeling and home improvements. Most housing fairs offer educational seminars and "ask the ex-pert" consulting services. Exhibitors include architects, landscapers, building contrac-tors, home products, city inspectors, financial services, among others.

o Home-Building Trades Partnerships – Partnership between local Technical Colleges or High Schools that offer building trades programs. Affordability is gained through re-duced labor costs provided by the school. New housing production serves as the “class-room” for future trades people to gain experience in the construction industry. This program is contingent on proximity to these programs.

o Home Energy Loans – Offer low interest home energy loans to make energy improve-ments in their homes.

o Household and Outside Maintenance for the Elderly (H.O.M.E.) Program – Persons 60 and over receive homemaker and maintenance services. Typical services include house

http://www.threeriverscap.org/housing/achieve-homeownership

http://www.rurdev.usda.gov/IA_Home.html



cleaning, grocery shopping, yard work/lawn care, and other miscellaneous maintenance requests.

o Infill Lots – The City or HRA purchase blighted or substandard housing units from willing sellers. After the home has been removed, the vacant land is placed into the program for future housing redevelopment. Future purchasers can be builders or the future owner-occupant who has a contract with a builder. Typically all construction must be completed within an allocated time-frame (one year in most cases).

o Land Banking – Land Banking is a program of acquiring land with the purpose of devel-oping at a later date. After a holding period, the land can be sold to a developer (often at a price lower than market) with the purpose of developing affordable housing.

o Land Trust - Utilizing a long-term 99-year ground lease, housing is affordable as the land is owned by a non-profit organization. Subject to income limits and targeted to work-force families with low-to-moderate incomes. If the family chooses to sell their home, the selling price is lower as land is excluded.

o Mobile Home Improvements – Offer low or no-interest loans to mobile home owners for rehabilitation. Establish income-guidelines based on family size and annual gross in-comes.

o Realtor Forum - Typically administered by City with partnership by local school board. Inform local Realtors about school district news, current development projects, and other marketing factors related to real estate in the community. In addition, Realtors usually receive CE credits.

o Redevelopment Credit – remove a substandard home with new construction o Rental License – Licensing rental properties in the communities. Designed to ensure all

rental properties meet local building and safety codes. Typically enforced by the fire marshal or building inspection department. Should require annual license renewal.

o Rent to Own - Income-eligible families rent for a specified length of time with the end-goal of buying a home. The City or HRA saves a portion of the monthly rent that will be allocated for a down payment on a future house.

o Tax Increment Financing (TIF): Program that offers communities a flexible financing tool to assist housing projects and related infrastructure. TIF enables communities to dedi-cate the incremental tax revenues from new housing development to help make the housing more affordable or pay for related costs. TIF funds can be used to provide a di-rect subsidy to a particular housing project or they can also be used to promote afford-able housing by setting aside a portion of TIF proceeds into a dedicated fund from other developments receiving TIF.

o Transfer of Development Rights – Transfer of Development Rights (TDR) is a program that shifts the development potential of one site to another site or different location, even a different community. TDR programs allow landowners to sever development rights from properties in government-designated low-density areas, and sell them to purchasers who want to increase the density of development in areas that local gov-ernments have selected as higher density areas.

o Waiver or Reduction of Development Fees – There are several fees developers must pay including impact fees, utility and connection fees, park land dedication fees, etc. To



help facilitate affordable housing, some fees could be waived or reduced to pass the cost savings onto the housing consumer.

• Job Growth/Employment. Historically, low unemployment rates have driven both existing home purchases and new-home purchases. Lack of job growth leads to slow or diminishing household growth, which in-turn relates to reduced housing demand. Table E-1 showed Wabasha County has an unemployment rate (4.6%) slightly less than the State of Minnesota (5.1%) in 2013. Today’s unemployment rate of around 4.6% has come down from the high of 7.8% in 2009. Generally, a 4% to 5% unemployment rate is considered full employment. However, Wabasha County’s labor force peaked in 2004 and is down by about 7%. Addi-tional job creation in Wabasha County will result in household growth that could exceed projections in Table D-3. At the same time, however, the housing stock must be able to meet householders need in order to capture this growth.

• Lot Supply. A three- to five-year supply of lots is an appropriate balance between providing adequate consumer choice and minimizing developers’ carrying costs. With an annual av-erage absorption of 13 single-family lots (based on the average annual number of building permits between 2000 and 2013), Plainview would need a supply of at least 40 platted lots to maintain a three-year lot supply. According to Table FS-5 there are only 14 vacant single-family lots located in newer subdivisions in Plainview. As a result, new lots need to be plat-ted to meet future single-family housing demand. In addition, Realtors believe there is a need for “choice lot,” or slightly larger lots that can accommodate ranch-style homes and offer a walk-out if topography warrants.

• Multifamily Development Costs. It will be challenging to construct new market rate multi-family product given achievable rents and development costs. According to RS Means con-struction costs data, construction costs in Plainview (utilizing construction averages in Rochester) will likely average about $150 per square foot (gross), or upwards to $165,000 per unit to develop based on a 24-unit multifamily concept. Development costs of this scale will likely require rents per square foot significantly higher than the existing product in Plainview. Based on these costs, it will be difficult to develop stand-alone multifamily hous-ing structures by the private sector based on achievable rents. As a result, a private-public partnership or other financing programs will likely be required to spur development.

• Plainview Image. Many of our interviewees mentioned that Plainview is not a recognizable

community due to its location that is not on a major highway or interstate. Furthermore, some interviewees feel the City does not promote and market the community enough as a destination to reside or raise a family. Realtors stressed the strength of the school district should be one of the key selling points of the community (i.e. small class sizes, test scores, walkability, safe community, etc.). We recommend a marketing and media strategy to promote to image of Plainview as a great place to do live and do business.

• Shadow Rental Inventory (i.e. Single Family Rentals). Shadow rentals are generally consid-

ered nontraditional rentals that were previously owner-occupied single-family homes,



townhomes, etc. Based on interviews with Realtors, the demand for single family rentals is strong in Plainview. A large percentage of renters have sought out single-family homes ver-sus traditional multifamily rental developments. Based on housing unit data outlined in Ta-ble HC-4, about 28% of the rental housing in Plainview is located in a single-family home or townhome. Furthermore, Table FS-7 identified about 100 non-homesteaded single-family properties in Plainview that are likely rental units. Realtors mentioned there is additional demand for single-family rental product from house-holds when they relocate to Plainview. Many of these households have children and their space requirements are not met with the few existing multifamily rental housing options. Monthly rents for single-family properties generally range from $650 to $1,000.

APPENDIX


APPENDIX

APPENDIX


Definitions Absorption Period – The period of time necessary for newly constructed or renovated proper-ties to achieve the stabilized level of occupancy. The absorption period begins when the first certificate of occupancy is issued and ends when the last unit to reach the stabilized level of oc-cupancy has signed a lease. Absorption Rate – The average number of units rented each month during the absorption peri-od. Active adult (or independent living without services available) – Active Adult properties are similar to a general-occupancy apartment building, in that they offer virtually no services but have age-restrictions (typically 55 or 62 or older). Organized activities and occasionally a trans-portation program are usually all that are available at these properties. Because of the lack of services, active adult properties typically do not command the rent premiums of more service-enriched senior housing. Adjusted Gross Income “AGI” – Income from taxable sources (including wages, interest, capital gains, income from retirement accounts, etc.) adjusted to account for specific deductions (i.e. contributions to retirement accounts, unreimbursed business and medical expenses, alimony, etc.). Affordable housing – The general definition of affordability is for a household to pay no more than 30% of their income for housing. For purposes of this study we define affordable housing that is income-restricted to households earning at or below 80% AMI, though individual proper-ties can have income-restrictions set at 40%, 50%, 60% or 80% AMI. Rent is not based on in-come but instead is a contract amount that is affordable to households within the specific in-come restriction segment. It is essentially housing affordable to low or very low-income ten-ants. Amenity – Tangible or intangible benefits offered to a tenant in the form of common area amenities or in-unit amenities. Typical in-unit amenities include dishwashers, washer/dryers, walk-in showers and closets and upgraded kitchen finishes. Typical common area amenities in-clude detached or attached garage parking, community room, fitness center and an outdoor patio or grill/picnic area. Area Median Income “AMI” – AMI is the midpoint in the income distribution within a specific geographic area. By definition, 50% of households earn less than the median income and 50% earn more. The U.S. Department of Housing and Urban Development (HUD) calculates AMI an-nually and adjustments are made for family size. Assisted Living – Assisted Living properties come in a variety of forms, but the target market for most is generally the same: very frail seniors, typically age 80 or older (but can be much young-er, depending on their particular health situation), who are in need of extensive support ser-

APPENDIX


vices and personal care assistance. Absent an assisted living option, these seniors would oth-erwise need to move to a nursing facility. At a minimum, assisted living properties include two meals per day and weekly housekeeping in the monthly fee, with the availability of a third meal and personal care (either included in the monthly fee or for an additional cost). Assisted living properties also have either staff on duty 24 hours per day or at least 24-hour emergency re-sponse. Building Permit – Building permits track housing starts and the number of housing units author-ized to be built by the local governing authority. Most jurisdictions require building permits for new construction, major renovations, as well as other building improvements. Building permits ensure that all the work meets applicable building and safety rules and is typically required to be completed by a licensed professional. Once the building is complete and meets the inspec-tor’s satisfaction, the jurisdiction will issue a “CO” or “Certificate of Occupancy.” Building per-mits are a key barometer for the health of the housing market and are often a leading indicator in the rest of the economy as it has a major impact on consumer spending. Capture Rate – The percentage of age, size, and income-qualified renter households in a given area or “Market Area” that the property must capture to fill the units. The capture rate is cal-culated by dividing the total number of units at the property by the total number of age, size and income-qualified renter households in the designated area. Comparable Property – A property that is representative of the rental housing choices of the designated area or “Market Area” that is similar in construction, size, amenities, location and/or age. Concession – Discount or incentives given to a prospective tenant to induce signature of a lease. Concessions typically are in the form of reduced rent or free rent for a specific lease term, or free amenities, which are normally charged separately, such as parking. Congregate (or independent living with services available) – Congregate properties offer sup-port services such as meals and/or housekeeping, either on an optional basis or a limited amount included in the rents. These properties typically dedicate a larger share of the overall building area to common areas, in part, because the units are smaller than in adult housing and in part to encourage socialization among residents. Congregate properties attract a slightly older target market than adult housing, typically seniors age 75 or older. Rents are also above those of the active adult buildings, even excluding the services. Contract Rent – The actual monthly rent payable by the tenant, including any rent subsidy paid on behalf of the tenant, to the owner, inclusive of all terms of the lease. Demand – The total number of households that would potentially move into a proposed new or renovated housing project. These households must be of appropriate age, income, tenure and size for a specific proposed development. Components vary and can include, but are not lim-

APPENDIX


ited to: turnover, people living in substandard conditions, rent over-burdened households, in-come-qualified households and age of householder. Demand is project specific. Density – Number of units in a given area. Density is typically measured in dwelling units (DU) per acre – the larger the number of units permitted per acre the higher the density; the fewer units permitted results in lower density. Density is often presented in a gross and net format:

• Gross Density – The number of dwelling units per acre based on the gross site acreage. Gross Density = Total residential units/total development area

• Net Density - The number of dwelling units per acre located on the site, but excludes public right-of-ways (ROW) such as streets, alleys, easements, open spaces, etc. Net Density = Total residential units/total residential land area (excluding ROWs)

Detached housing – a freestanding dwelling unit, most often single-family homes, situated on its own lot. Effective Rents – Contract rent less applicable concessions. Elderly or Senior Housing – Housing where all the units in the property are restricted for occu-pancy by persons age 62 years or better, or at least 80% of the units in each building are re-stricted for occupancy by households where at least one household member is 55 years of age or better and the housing is designed with amenities, facilities and services to meet the needs of senior citizens. Extremely low-income – person or household with incomes below 30% of Area Median In-come, adjusted for respective household size. Fair Market Rent – Estimates established by HUD of the Gross Rents needed to obtain modest rental units in acceptable conditions in a specific geographic area. The amount of rental income a given property would command if it were open for leasing at any given moment and/or the amount derived based on market conditions that is needed to pay gross monthly rent at mod-est rental housing in a given area. This figure is used as a basis for determining the payment standard amount used to calculate the maximum monthly subsidy for families on at financially assisted housing.

Fair Market Rent Wabasha County – 2014

EFF 1BR 2BR 3BR 4BR

Fair Market Rent $508 $511 $637 $939 $997

Fair Market Rent

APPENDIX


Floor Area Ratio (FAR) Ratio of the floor area of a building to area of the lot on which the build-ing is located. Foreclosure – A legal process in which a lender or financial institute attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by using the sale of the house as collateral for the loan. Gross Rent – The monthly housing cost to a tenant which equals the Contract Rent provided for in the lease, plus the estimated cost of all utilities paid by tenants. Maximum Gross Rents for Hennepin County can be shown on the following page.

Gross Rent

Wabasha County – 2014

EFF 1BR 2BR 3BR 4BR

30% of median $362 $414 $465 $517 $55950% of median $603 $690 $776 $862 $93260% of median $724 $828 $931 $1,035 $1,11980% of median $966 $1,104 $1,242 $1,380 $1,492100% of median $1,207 $1,380 $1,552 $1,725 $1,865120% of median $1,449 $1,656 $1,863 $2,070 $2,238

Maximum Gross Rent

Household – All persons who occupy a housing unit, including occupants of a single-family, one person living alone, two or more families living together, or any other group of related or unre-lated persons who share living arrangements. Household Trends – Changes in the number of households for any particular areas over a measurable period of time, which is a function of hew households formations, changes in aver-age household size, and met migration. Housing Choice Voucher Program – The federal government's major program for assisting very low-income families, the elderly, and the disabled to afford decent, safe, and sanitary housing in the private market. A family that is issued a housing voucher is responsible for finding a suit-able housing unit of the family's choice where the owner agrees to rent under the program. Housing choice vouchers are administered locally by public housing agencies. They receive fed-eral funds from the U.S. Department of Housing and Urban Development (HUD) to administer the voucher program. A housing subsidy is paid to the landlord directly by the public housing agency on behalf of the participating family. The family then pays the difference between the actual rent charged by the landlord and the amount subsidized by the program.

APPENDIX


Housing unit – House, apartment, mobile home, or group of rooms used as a separate living quarters by a single household. HUD Project-Based Section 8 – A federal government program that provides rental housing for very low-income families, the elderly, and the disabled in privately owned and managed rental units. The owner reserves some or all of the units in a building in return for a Federal govern-ment guarantee to make up the difference between the tenant's contribution and the rent. A tenant who leaves a subsidized project will lose access to the project-based subsidy. HUD Section 202 Program – Federal program that provides direct capital assistance and operat-ing or rental assistance to finance housing designed for occupancy by elder household who have incomes not exceeding 50% of Area Median Income. HUD Section 811 Program – Federal program that provides direct capital assistance and operat-ing or rental assistance to finance housing designed for occupancy of persons with disabilities who have incomes not exceeding 50% Area Median Income. HUD Section 236 Program – Federal program that provides interest reduction payments for loans which finance housing targeted to households with income not exceeding 80% Area Me-dian Income who pay rent equal to the greater or market rate or 30% of their adjusted income. Income limits – Maximum households income by a designed geographic area, adjusted for household size and expressed as a percentage of the Area Median Income, for the purpose of establishing an upper limit for eligibility for a specific housing program. See Income-qualifications. Inflow/Outflow – The Inflow/Outflow Analysis generates results showing the count and charac-teristics of worker flows in to, out of, and within the defined geographic area. Low-Income – Person or household with gross household incomes below 80% of Area Median Income, adjusted for household size. Low-Income Housing Tax Credit – A program aimed to generate equity for investment in af-fordable rental housing authorized pursuant to Section 42 of the Internal Revenue Code. The program requires that a certain percentage of units built be restricted for occupancy to house-holds earning 60% or less of Area Median Income, and rents on these units be restricted ac-cordingly. Market analysis – The study of real estate market conditions for a specific type of property, ge-ographic area or proposed (re)development. Market rent – The rent that an apartment, without rent or income restrictions or rent subsi-dies, would command in a given area or “Market Area” considering its location, features and amenities.

APPENDIX


Market study – A comprehensive study of a specific proposal including a review of the housing market in a defined market or geography. Project specific market studies are often used by de-velopers, property managers or government entities to determine the appropriateness of a proposed development, whereas market specific market studies are used to determine what house needs, if any, existing within a specific geography. Market rate rental housing – Housing that does not have any income-restrictions. Some prop-erties will have income guidelines, which are minimum annual incomes required in order to re-side at the property. Memory Care – Memory Care properties, designed specifically for persons suffering from Alz-heimer’s disease or other dementias, is one of the newest trends in senior housing. Properties consist mostly of suite-style or studio units or occasionally one-bedroom apartment-style units, and large amounts of communal areas for activities and programming. In addition, staff typical-ly undergoes specialized training in the care of this population. Because of the greater amount of individualized personal care required by residents, staffing ratios are much higher than tradi-tional assisted living and thus, the costs of care are also higher. Unlike conventional assisted liv-ing, however, which deals almost exclusively with widows or widowers, a higher proportion of persons afflicted with Alzheimer’s disease are in two-person households. That means the deci-sion to move a spouse into a memory care facility involves the caregiver’s concern of incurring the costs of health care at a special facility while continuing to maintain their home. Migration – The movement of households and/or people into or out of an area. Mixed-income property – An apartment property contained either both income-restricted and unrestricted units or units restricted at two or more income limits. Mobility – The ease at which people move from one location to another. Moderate Income – Person or household with gross household income between 80% and 120% of the Area Median Income, adjusted for household size. Multifamily – Properties and structures that contain more than two housing units. Naturally Occurring Affordable Housing – Although affordable housing is typically associated with an income-restricted property, there are other housing units in communities that indirect-ly provide affordable housing. Housing units that were not developed or designated with in-come guidelines (i.e. assisted) yet are more affordable than other units in a community are con-sidered “naturally-occurring” or “unsubsidized affordable” units. This rental supply is available through the private market, versus assisted housing programs through various governmental agencies. Property values on these units are lower based on a combination of factors, such as: age of structure/housing stock, location, condition, size, functionally obsolete, school district, etc.

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Net Income – Income earned after payroll withholdings such as state and federal income taxes, social security, as well as retirement savings and health insurance. Net Worth – The difference between assets and liabilities, or the total value of assets after the debt is subtracted. Pent-up demand – A market in which there is a scarcity of supply and as such, vacancy rates are very low or non-existent. Population – All people living in a geographic area. Population Density – The population of an area divided by the number of square miles of land area. Population Trends – Changes in population levels for a particular geographic area over a specif-ic period of time – a function of the level of births, deaths, and in/out migration. Project-Based rent assistance – Rental assistance from any source that is allocated to the prop-erty or a specific number of units in the property and is available to each income eligible tenant of the property or an assisted unit. Redevelopment – The redesign, rehabilitation or expansion of existing properties. Rent burden – gross rent divided by adjusted monthly household income. Restricted rent – The rent charged under the restriction of a specific housing program or subsi-dy. Saturation – The point at which there is no longer demand to support additional market rate, affordable/subsidized, rental, for-sale, or senior housing units. Saturation usually refers to a particular segment of a specific market. Senior Housing – The term “senior housing” refers to any housing development that is restrict-ed to people age 55 or older. Today, senior housing includes an entire spectrum of housing al-ternatives. Maxfield Research Inc. classifies senior housing into four categories based on the level of support services. The four categories are: Active Adult, Congregate, Assisted Living and Memory Care. Short Sale – A sale of real estate in which the net proceeds from selling the property do not cover the sellers’ mortgage obligations. The difference is forgiven by the lender, or other ar-rangements are made with the lender to settle the remainder of the debt.

APPENDIX


Single-family home – A dwelling unit, either attached or detached, designed for use by one household and with direct street access. It does not share heating facilities or other essential electrical, mechanical or building facilities with another dwelling. Stabilized level of occupancy – The underwritten or actual number of occupied units that a property is expected to maintain after the initial lease-up period. Subsidized housing – Housing that is income-restricted to households earning at or below 30% AMI. Rent is generally based on income, with the household contributing 30% of their adjusted gross income toward rent. Also referred to as extremely low income housing. Subsidy – Monthly income received by a tenant or by an owner on behalf of a tenant to pay the difference between the apartment’s contract/market rate rent and the amount paid by the tenant toward rent. Substandard conditions – Housing conditions that are conventionally considered unacceptable and can be defined in terms of lacking plumbing facilities, one or more major mechanical or electrical system malfunctions, or overcrowded conditions. Target population – The market segment or segments of the given population a development would appeal or cater to. Tenant – One who rents real property from another individual or rental company. Tenant-paid utilities – The cost of utilities, excluding cable, telephone, or internet necessary for the habitation of a dwelling unit, which are paid by said tenant. Tenure – The distinction between owner-occupied and renter-occupied housing units. Turnover – A measure of movement of residents into and out of a geographic location. Turnover period – An estimate of the number of housing units in a geographic location as a percentage of the total house units that will likely change occupants in any one year. Unrestricted units – Units that are not subject to any income or rent restrictions. Vacancy period – The amount of time an apartment remains vacant and is available on the market for rent. Workforce housing – Housing that is income-restricted to households earning between 80% and 120% AMI. Also referred to as moderate-income housing. Zoning – Classification and regulation of land use by local governments according to use cate-gories (zones); often also includes density designations and limitations

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