DEMOGRAPHIC CHARACTERISTICS AND TRENDS
MONTGOMERY SUBMARKET #8
A. SUBMARKET DESCRIPTION
1. LOCATION
The Montgomery Submarket is located in Montgomery County north of
suburban Houston and is defined as all of Montgomery County. The
Montgomery Submarket was determined through interviews with area leasing
and real estate agents, government officials, economic development
representatives, and the personal observations of our analysts. The personal
observations of our analysts include physical and/or socioeconomic differences
in the market and a demographic analysis of the area households and
population.
2. COUNTY SEAT
Conroe
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3. LOCAL GOVERNMENT
The Woodlands, Conroe and Willis are the primary towns in this submarket.
The city of Conroe operates under a home-rule charter that was adopted by the
citizens of Conroe in 1965. The charter provides for the election of a city
council consisting of a mayor and five council members.
The Woodlands is a master-planned community with a local governmental
agency created by the Texas Legislature. Nearly all of the community is
located in the city of Houston's extraterritorial jurisdiction (ETJ) with a small
portion in the corporate limits of Shenandoah.
The city of Willis is a Class A General Law community subject to the
Constitution of the State of Texas. The City Council and Mayor are currently
working on an initial draft of a charter for the city which will be submitted to
the voters of Willis. If the voters approve the charter, the City of Willis will
then be a home-rule community. The vote on home-rule status us expected
during 2006.
4. AREA
Area: 922 square miles
2005 Population: 322,390
2005 Households: 114,409
5. COMMUNITY SERVICES AND INFRASTRUCTURE
A map illustrating the location of community services is on the following page.
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Montgomery: Community Services
45
SAN AUGUST
HOUSTON
LEON
ANGELINA
156 TRINITY
ROBERTSON
75 MADISON
45
v WALKER
POLK
TYLER
J
BRAZOS
SAN JACINTO
GRIMES
v
BURLESON
150 45
T
T
HARDIN
MONTGOMERY
WASHINGTON
LIBERTY
B
v
-
WALLER
AUSTIN JEFFERSO
HARRIS
HOUSTON 10
-
610 CHAMBERS
10 Pasadena
-
COLORADO
T FORT BEND
GALVESTON
45
WHARTON
Lake Conroe
BRAZORIA
T 0 40 80 120
Miles
T
105
Map layers
Submarket
45 w
T y Fire Department
\
CONROE
C Police
C v 667
Airport/Airfield
y T57
59
\ College/Univ
925
w Hospital
T T Oilfield
v Park
T T 0 3 6 9
v 242
T T Miles
1:375,193
THE WOODLANDS
T
249
C
178
T T
T
T
v T y
234
yC
664
451
T
v T 45
y
y 498
SPRING
y 59
C y
y
499
T
6 y
290 C 313 y
C
381
y
416
6. DEMOGRAPHIC CHARACTERISTICS AND TRENDS
a. POPULATION TRENDS
The Montgomery Submarket population base has increased by 98,062
between 1990 and 2000. This represents a 59.5% increase from the 1990
total population, or an annual rate of 4.8%. The submarket population
bases for 1990, 2000, 2005 (estimated), and 2010 (projected) are
summarized as follows:
YEAR
1990 2000 2005 2010
(CENSUS) (CENSUS) (ESTIMATED) (PROJECTED)
POPULATION 164,848 262,910 322,390 385,356
POPULATION CHANGE - 98,062 59,480 62,966
PERCENT CHANGE - 59.5% 22.6% 19.5%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
It is projected that the total population will increase by 62,966 people, or
19.5%, between 2005 and 2010.
b. HOUSEHOLD TRENDS
Within the Montgomery Submarket, the total number of households has
increased by 35,191 (60.8%) between 1990 and 2000. Household trends
within the Montgomery Submarket are summarized as follows:
YEAR
1990 2000 2005 2010
(CENSUS) (CENSUS) (ESTIMATED) (PROJECTED)
HOUSEHOLDS 57,871 93,062 114,409 136,974
HOUSEHOLD CHANGE - 35,191 21,347 22,565
PERCENT CHANGE - 60.8% 22.9% 19.7%
HOUSEHOLD SIZE 2.8 2.8 2.8 2.8
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
Total household growth has been positive between 1990 and 2000, and is
projected to continue to increase when there will be a total of 136,974
households in 2010. This is an increase of approximately 4,391
households annually.
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The submarket household bases by age are summarized as follows:
HOUSEHOLDS 2005 (ESTIMATED) 2010 (PROJECTED) CHANGE 2005-2010
BY AGE NUMBER PERCENT NUMBER PERCENT NUMBER PERCENT
UNDER 25 5,855 5.1% 6,744 4.9% 889 15.2%
25 - 34 19,840 17.3% 22,514 16.4% 2,674 13.5%
35 - 44 25,034 21.9% 26,266 19.2% 1,232 4.9%
45 - 54 26,204 22.9% 30,636 22.4% 4,432 16.9%
55 - 64 18,658 16.3% 25,379 18.5% 6,721 36.0%
65 - 74 11,110 9.7% 15,322 11.2% 4,212 37.9%
75 - 84 6,165 5.4% 7,931 5.8% 1,766 28.6%
85 & HIGHER 1,543 1.3% 2,184 1.6% 641 41.5%
TOTAL 114,409 100.0% 136,976 100.0% 22,567 19.7%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
Between 2005 and 2010, the greatest growth among household age groups
is expected to be among households aged 55 and higher.
Households by tenure are distributed as follows:
2000 (CENSUS) 2005 (ESTIMATED)
TENURE HOUSEHOLDS PERCENT HOUSEHOLDS PERCENT
OWNER-OCCUPIED 71,571 76.9% 89,312 78.1%
RENTER-OCCUPIED 21,491 23.1% 25,097 21.9%
TOTAL 93,062 100.0% 114,409 100.0%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
Owner-occupied households, as evidenced by the fact that over three-
quarters of all occupied housing units are owner-occupied, dominate the
market.
The household size within the submarket, based on the 2000 Census, is
distributed as follows:
PERSONS PER 2000 (CENSUS) 2005 (ESTIMATED) CHANGE 2000-2005
HOUSEHOLD HOUSEHOLDS PERCENT HOUSEHOLDS PERCENT HOUSEHOLDS PERCENT
1 PERSON 17,530 18.8% 21,639 18.9% 4,109 23.4%
2 PERSONS 30,514 32.8% 37,342 32.6% 6,828 22.4%
3 PERSONS 16,784 18.0% 20,907 18.3% 4,123 24.6%
4 PERSONS 16,325 17.5% 19,914 17.4% 3,589 22.0%
5 PERSONS 7,599 8.2% 9,348 8.2% 1,749 23.0%
6+ PERSONS 4,310 4.6% 5,259 4.6% 949 22.0%
TOTAL 93,062 100.0% 114,409 100.0% 21,347 22.9%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
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Based on the 2000 Census, the following is a distribution of housing units
in the submarket by year of construction.
HOUSING UNITS
YEAR OWNER PERCENT RENTER PERCENT
1999 TO MARCH 2000 4,574 6.4% 1,122 5.2%
1995 TO 1998 15,155 21.2% 2,761 12.8%
1990 TO 1994 10,406 14.5% 2,038 9.5%
1980 TO 1989 16,870 23.6% 6,651 30.9%
1970 TO 1979 17,097 23.9% 5,714 26.6%
1960 TO 1969 4,661 6.5% 1,887 8.8%
1940 TO 1959 2,170 3.0% 1,074 5.0%
1939 OR EARLIER 638 0.9% 244 1.1%
TOTAL 71,571 100.0% 21,491 100.0%
Approximately 42.1% of the owner-occupied homes in the submarket
were built since 1990. From 1995 through March 2000, the market
absorbed 19,729 new owner-occupied homes, translating into nearly 313
homes per month over this period.
HOUSING UNIT BUILDING PERMITS FOR
MONTGOMERY COUNTY, TX
1999 2000 2001 2002 2003 2004
UNITS IN SINGLE-FAMILY STRUCTURES 4,493 4,067 3,997 4,497 5,581 6,023
UNITS IN 2-UNIT MULTIFAMILY
STRUCTURES 30 78 0 0 6 2
UNITS IN 3- AND 4-UNIT MULTIFAMILY
STRUCTURES 0 0 32 52 0 0
UNITS IN 5+ UNIT MULTIFAMILY
STRUCTURES 396 52 88 484 726 952
UNITS IN ALL MULTIFAMILY STRUCTURES 426 130 120 536 732 954
TOTAL UNITS 4,919 4,197 4,117 5,033 6,313 6,977
Source: SOCDS
SUBSTANDARD UNITS 2000 CENSUS
LACKING
TOTAL COMPLETE COMPLETE
HOUSING PLUMBING PLUMBING PERCENT
TENURE UNITS PERCENT FACILITIES FACILITIES SUBSTANDARD
OWNER-
OCCUPIED 71,571 76.9% 71,260 311 0.4%
RENTER-
OCCUPIED 21,491 23.1% 21,245 246 1.1%
TOTAL 93,062 100.0% 92,505 557 0.6%
Source: 2000 Census
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POVERTY STATUS 2000 CENSUS
POPULATION NOT LIVING IN 237,671 90.4%
POVERTY
POPULATION LIVING IN 25,239 9.6%
POVERTY
TOTAL* 262,910 100.0%
Source: Summary File 3, Census of Population and Housing, U.S. Bureau of
the Census, 2000
* Population for whom poverty status is determined
TURNOVER RATE
HOUSTON MSA 64.4%
Source: 2003 IREM Income/Expense Analysis for Conventional Apartments
PERCENTAGE OF RENT-OVERBURDENED
MONTGOMERY SUBMARKET 17.3%
Source: 2000 Census, Claritas
7. INCOME TRENDS
The distribution of households by income within the Montgomery Submarket
is summarized as follows:
HOUSEHOLD 2000 (CENSUS) 2005 (ESTIMATED) 2010 (PROJECTED)
INCOME NUMBER PERCENT NUMBER PERCENT NUMBER PERCENT
LESS THAN $10,000 6,669 7.2% 7,154 6.3% 7,599 5.5%
$10,000 - $19,999 9,080 9.8% 9,331 8.2% 9,432 6.9%
$20,000 - $29,999 9,994 10.7% 10,337 9.0% 10,657 7.8%
$30,000 - $39,999 10,735 11.5% 11,172 9.8% 11,259 8.2%
$40,000 - $49,999 9,377 10.1% 11,138 9.7% 12,133 8.9%
$50,000 - $59,999 7,640 8.2% 9,227 8.1% 11,117 8.1%
$60,000 - $74,999 10,306 11.1% 11,643 10.2% 13,467 9.8%
$75,000 - $99,999 11,377 12.2% 14,859 13.0% 17,594 12.8%
$100,000 & HIGHER 17,884 19.2% 29,548 25.8% 43,716 31.9%
TOTAL 93,062 100.0% 114,409 100.0% 136,974 100.0%
MEDIAN INCOME $50,884 $58,748 $67,006
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
In 2000, the median household income was $50,884. This increased 15.5%
to $58,748 in 2005. By 2010, it is estimated the median household income
will be $67,006, an increase of 14.1% over 2005.
Between 2000 and 2005, most of the household growth was among
households with incomes of $75,000 and higher.
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The following tables illustrate renter household income by household size for
2000, 2005 (estimated), 2006 (projected), 2007 (projected), 2008 (projected),
and 2009 (projected) for the submarket:
RENTER 2000 CENSUS
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,824 533 389 283 150 3,179
$10,000 - $20,000 1,549 828 572 425 296 3,669
$20,000 - $30,000 1,189 961 579 392 369 3,490
$30,000 - $40,000 957 788 514 375 426 3,061
$40,000 - $50,000 661 792 481 370 286 2,590
$50,000 - $60,000 341 549 324 226 224 1,664
$60,000+ 471 1,277 844 662 584 3,838
TOTAL 6,992 5,727 3,704 2,733 2,335 21,491
Source: Ribbon Demographics, Claritas
RENTER 2005 ESTIMATED
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 2,189 565 414 303 151 3,622
$10,000 - $20,000 1,730 830 585 395 280 3,821
$20,000 - $30,000 1,375 971 561 388 359 3,654
$30,000 - $40,000 1,149 841 574 420 482 3,465
$40,000 - $50,000 847 880 494 408 301 2,930
$50,000 - $60,000 485 659 420 292 297 2,152
$60,000+ 763 1,775 1,187 902 826 5,453
TOTAL 8,537 6,521 4,235 3,108 2,696 25,097
Source: Ribbon Demographics, Claritas
RENTER 2006 PROJECTED
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 2,246 560 412 300 150 3,668
$10,000 - $20,000 1,780 823 586 392 277 3,858
$20,000 - $30,000 1,410 968 557 382 355 3,671
$30,000 - $40,000 1,180 838 573 412 482 3,484
$40,000 - $50,000 880 894 509 418 312 3,013
$50,000 - $60,000 519 681 435 304 304 2,243
$60,000+ 869 1,920 1,297 980 908 5,974
TOTAL 8,884 6,685 4,369 3,187 2,788 25,913
Source: Ribbon Demographics, Claritas
RENTER 2007 PROJECTED
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 2,303 555 411 297 149 3,715
$10,000 - $20,000 1,830 816 587 389 274 3,896
$20,000 - $30,000 1,444 965 552 376 350 3,687
$30,000 - $40,000 1,211 834 571 405 482 3,504
$40,000 - $50,000 913 908 524 428 323 3,096
$50,000 - $60,000 554 703 450 316 312 2,334
$60,000+ 975 2,066 1,408 1,057 990 6,496
TOTAL 9,230 6,849 4,503 3,267 2,880 26,728
Source: Ribbon Demographics, Claritas
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RENTER 2008 PROJECTED
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 2,360 550 410 294 147 3,761
$10,000 - $20,000 1,879 810 589 385 271 3,934
$20,000 - $30,000 1,479 962 547 370 345 3,704
$30,000 - $40,000 1,242 831 569 397 483 3,523
$40,000 - $50,000 946 922 539 438 334 3,179
$50,000 - $60,000 588 726 464 328 320 2,425
$60,000+ 1,081 2,212 1,518 1,135 1,072 7,018
TOTAL 9,577 7,013 4,636 3,346 2,972 27,544
Source: Ribbon Demographics, Claritas
RENTER 2009 PROJECTED
HOUSEHOLDS 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 2,417 545 408 291 146 3,808
$10,000 - $20,000 1,929 803 590 382 268 3,972
$20,000 - $30,000 1,514 959 543 364 340 3,720
$30,000 - $40,000 1,274 828 568 390 483 3,542
$40,000 - $50,000 978 936 555 448 344 3,262
$50,000 - $60,000 623 748 479 339 327 2,516
$60,000+ 1,187 2,358 1,628 1,212 1,154 7,539
TOTAL 9,924 7,177 4,770 3,425 3,064 28,359
Source: Ribbon Demographics, Claritas
The following tables illustrate renter household income by household size
(55+) for 2000, 2005 (estimated), 2006 (projected), 2007 (projected), 2008
(projected), and 2009 (projected) for the submarket:
RENTER 2000 CENSUS
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,036 173 6 8 1 1,224
$10,000 - $20,000 926 180 66 12 26 1,210
$20,000 - $30,000 361 171 43 20 20 615
$30,000 - $40,000 211 127 40 16 18 412
$40,000 - $50,000 124 112 44 6 3 290
$50,000 - $60,000 85 102 26 8 15 236
$60,000+ 173 250 43 17 17 499
TOTAL 2,917 1,115 267 87 100 4,486
Source: Ribbon Demographics, Claritas
RENTER 2005 ESTIMATED
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,244 189 8 14 2 1,457
$10,000 - $20,000 1,076 194 80 14 27 1,391
$20,000 - $30,000 468 214 54 26 23 786
$30,000 - $40,000 258 150 43 5 16 473
$40,000 - $50,000 199 181 58 34 6 479
$50,000 - $60,000 100 130 44 13 20 306
$60,000+ 290 378 82 25 25 801
TOTAL 3,636 1,437 371 131 119 5,693
Source: Ribbon Demographics, Claritas
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RENTER 2006 PROJECTED
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,280 189 9 14 2 1,494
$10,000 - $20,000 1,114 194 83 14 27 1,433
$20,000 - $30,000 494 226 57 27 23 827
$30,000 - $40,000 273 155 43 5 17 492
$40,000 - $50,000 217 190 61 39 7 515
$50,000 - $60,000 112 138 47 16 23 337
$60,000+ 335 417 94 27 28 902
TOTAL 3,826 1,510 396 142 126 5,999
Source: Ribbon Demographics, Claritas
RENTER 2007 PROJECTED
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,317 189 9 14 2 1,531
$10,000 - $20,000 1,152 195 86 14 27 1,475
$20,000 - $30,000 520 238 61 27 23 868
$30,000 - $40,000 287 160 43 5 17 511
$40,000 - $50,000 236 199 65 44 7 551
$50,000 - $60,000 125 147 51 19 26 368
$60,000+ 380 455 106 30 31 1,002
TOTAL 4,016 1,583 420 153 134 6,306
Source: Ribbon Demographics, Claritas
RENTER 2008 PROJECTED
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,353 189 9 15 1 1,568
$10,000 - $20,000 1,191 195 89 15 28 1,517
$20,000 - $30,000 545 250 64 27 23 909
$30,000 - $40,000 301 165 42 5 17 530
$40,000 - $50,000 254 208 68 49 8 587
$50,000 - $60,000 137 156 55 22 29 399
$60,000+ 424 493 119 32 34 1,103
TOTAL 4,206 1,656 445 164 141 6,612
Source: Ribbon Demographics, Claritas
RENTER 2009 PROJECTED
HOUSEHOLDS 55+ 1-PERSON 2-PERSON 3-PERSON 4-PERSON 5+-PERSON TOTAL
$0 - $10,000 1,390 189 9 15 1 1,604
$10,000 - $20,000 1,229 196 92 15 28 1,559
$20,000 - $30,000 571 261 67 27 23 949
$30,000 - $40,000 315 170 42 4 18 549
$40,000 - $50,000 273 217 71 54 9 623
$50,000 - $60,000 149 165 58 24 32 430
$60,000+ 469 532 131 34 38 1,203
TOTAL 4,396 1,729 470 175 148 6,918
Source: Ribbon Demographics, Claritas
Data from the preceding tables is used in our demand estimates.
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8. LOCAL ECONOMIC PROFILE AND ANALYSIS
a. LABOR FORCE PROFILE
Services and Retail Trade comprise a little more than 59% of the
Submarket labor force.
Employment within the Montgomery Submarket as of 2005 is distributed
as follows:
SIC GROUP ESTABLISHMENTS PERCENT EMPLOYEES PERCENT
AGRICULTURE & NATURAL
RESOURCES 287 2.6% 2,026 1.6%
MINING 107 1.0% 5,899 4.6%
CONSTRUCTION 1,178 10.5% 8,675 6.8%
MANUFACTURING 541 4.8% 12,070 9.5%
TRANSPORTATION & UTILITIES 470 4.2% 5,498 4.3%
WHOLESALE TRADE 610 5.5% 4,820 3.8%
RETAIL TRADE 2,442 21.8% 30,167 23.7%
F.I.R.E. 1,089 9.7% 8,227 6.5%
SERVICES 4,133 37.0% 45,283 35.5%
GOVERNMENT 203 1.8% 3,947 3.1%
NON-CLASSIFIABLE 125 1.1% 869 0.7%
TOTAL 11,185 100.0% 127,481 100.0%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
Note: Due to the fact that this survey is conducted of establishments and not of residents, some employees may not live
within the Submarket. However, these employees are included in our labor force calculations because their places of
employment are located within the Submarket.
The 10 largest employers within Montgomery County are summarized as
follows:
INDUSTRY BUSINESS TYPE TOTAL EMPLOYED
CONROE ISD EDUCATION NA
CROWN STAFFING INC. EMPLOYMENT AGENCY NA
HEWITT ASSOCIATES CONSULTING NA
HEB GROCERY GROCERY NA
KROGER GROCERY NA
MAGNOLIA ISD EDUCATION NA
MEDICAL CENTER HOSPITAL HEALTH CARE NA
COUNTY OF MONTGOMERY GOVERNMENT NA
NEW CANEY ISD EDUCATION NA
WAL-MART ASSOCIATES, INC. RETAIL NA
TOTAL NA
Note the number of employees per firm was not available.
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b. EMPLOYMENT TRENDS
The employment base has increased by 15.9% over the past five years in
Montgomery County, more than the Texas state average of 6.4%.
Unemployment rates for Montgomery County and Texas are illustrated as
follows:
UNEMPLOYMENT RATE
YEAR MONTGOMERY COUNTY TEXAS
1996 4.1% 5.8%
1997 3.9% 5.4%
1998 3.4% 4.9%
1999 3.4% 4.7%
2000 3.7% 4.4%
2001 3.9% 5.0%
2002 4.9% 6.3%
2003 5.4% 6.7%
2004 5.1% 6.1%
2005 4.8% 5.6%
The unemployment rate in Montgomery County has remained between
3.4% and 5.4%, well below the state average since 1996.
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RENTAL HOUSING ANALYSIS (SUPPLY) –
MONTGOMERY SUBMARKET #8
A. OVERVIEW OF RENTAL HOUSING
Vogt Williams & Bowen, LLC identified and personally surveyed a total of
12 Tax Credit developments, 11 market-rate developments, one government-
subsidized development, one Tax Credit/market-rate development, two Tax
Credit/market-rate/government-subsidized developments, and two Tax
Credit/government-subsidized developments in the Montgomery Submarket.
The surveyed Tax Credit developments have a combined occupancy rate of
79.1%. Note this includes three Tax Credit developments that were built in
2005 and are currently in lease-up. The surveyed market-rate developments
have a combined occupancy rate of 91.2%; this includes one market-rate
property that was built in 2005 and is currently in lease-up. The surveyed
government-subsidized property has an occupancy rate of 100.0%; the
surveyed market-rate Tax Credit property has an occupancy rate of 94.2%; the
surveyed Tax Credit/market-rate/government-subsidized properties have a
combined occupancy rate of 100.0%; and the surveyed Tax Credit/
government-subsidized properties have an occupancy rate of 96.6%.
According to the on-line property inventory list of Tax Credit allocations
provided by the Texas Department of Housing and Community Affairs
(TDHCA), there is one additional Tax Credit property in the Montgomery
Submarket. Despite repeated attempts, information was not available for
Montgomery Trace Apartments. There are also three Tax Credit properties
allocated and not yet built in this submarket (Tamarac Pines Apartments, Park
at Woodline Townhomes and Copperwood Apartments).
This survey was conducted to establish the overall strength of the rental
submarket, establish and confirm vacancy and rent levels, and gather
information on the current rental housing situation resulting from hurricanes
Katrina and Rita.
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Following is the list of Tax Credit properties surveyed, both in person and by
telephone:
TAX CREDIT
MAP PROJECT YEAR BUILT/ TOTAL TARGET
I.D. PROJECT NAME TYPE RENOVATED UNITS MARKET
1 TIMBER MILL TAX 1994 216 FAMILY
2 HOLLOW CREEK MRT 1996 90 FAMILY
3 GARDEN GATE TAX 1999 88 FAMILY
4 PORTER SQUARE TGS 1979/1995 48 FAMILY
5 NEW CAREY OAKS II TGS 1992 100 FAMILY
6 PORTER PLAZA TAX 1994 50 FAMILY
7 PARK VILLAGE TAX 1997 144 FAMILY
8 MISSION WOODS TAX 1995 306 FAMILY
9 FOREST VIEW TAX 1993 260 FAMILY
12 CRICKET HOLLOW APTS. TAX 2005 176 FAMILY
14 FORD ROAD APTS. TAX 1976/1995 56 FAMILY
15 WILLIS SOUTH APTS. TMG 1978/1987 20 FAMILY
16 WILLIS RENTAL APTS. TMG 1978/1987 21 FAMILY
17 HAVENWOOD PLACE TAX 1997 64 FAMILY
18 MONTGOMERY PLACE TAX 2005 224 FAMILY
21 WILSHIRE APTS. TAX 1987 19 FAMILY
25 PARK AT PINEY WOOD TAX 2005 188 FAMILY
TAX-Tax Credit
MRT-Market-rate & Tax Credit
TGS-Tax Credit & Government-subsidized
TMG-Tax Credit, Market-rate & Government-subsidized
Most of the Tax Credit developments in the Montgomery Submarket were
built in the 1990s. However, there are three developments that were built in
2005 and are currently in lease-up. While there are no existing senior Tax
Credit developments, two of the three planned Tax Credit apartments will be
age-restricted.
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Following is the list of market-rate properties surveyed, both in person and by
telephone:
MARKET-RATE
MAP YEAR BUILT/ TOTAL TARGET
I.D. PROJECT NAME RENOVATED UNITS MARKET
2 HOLLOW CREEK 1996 30 FAMILY
10 PARK AT WOODLAND SPRINGS 2006 U/C FAMILY
11 MONTGOMERY TRACE APTS. 2006 U/C FAMILY
15 WILLIS SOUTH APTS. 1978/1987 2 FAMILY
16 WILLIS RENTAL APTS. 1978/1987 1 FAMILY
19 VILLAGE SQUARE 1980 270 FAMILY
20 PARKSIDE APTS. 1984/1998 360 FAMILY
22 PORTERWOOD APTS. 1983 136 FAMILY
23 TIMBERS OF PINE HOLLOW 1977/2005 228 FAMILY
24 SUN PARK APTS. 1985 168 FAMILY
26 AUTUMN WOODS 1983 1983 FAMILY
27 FALLS AT BOROUGH PARK 2003 200 FAMILY
28 STERLING RIDGE ESTATES 2005 254 FAMILY
29 GROGAN’S LANDING 1979/2005 384 FAMILY
Sterling Ridge Estates opened in March 2005 and is still in lease-up. Park at
Woodland Springs (250 units) and Montgomery Trace Apartments (144 units)
are both currently under construction.
Following is the list of government-subsidized properties surveyed, both in
person and by telephone:
GOVERNMENT-SUBSIDIZED
MAP PROJECT YEAR BUILT/ TOTAL TARGET
I.D. PROJECT NAME TYPE RENOVATED UNITS MARKET
13 COPPERWOOD APTS. SEC. 8 1981 264 SENIOR
The following table summarizes the family Tax Credit (non-subsidized) rental
market:
GROSS RENT
BEDROOMS UNITS DISTRIBUTION VACANT PERCENT RANGE
ONE-BEDROOM 406 21.1% 22 5.4% $379-$702
TWO-BEDROOM 912 47.5% 170 18.6% $452-$836
THREE-BEDROOM 493 25.7% 187 37.9% $723-$943
FOUR-BEDROOM 111 5.8% 2 1.8% $862-$977
TOTAL 1,922 100.0% 381 19.8%
The distribution of Tax Credit units by bedroom type is typical for an urban
market like the Montgomery Submarket. Note the above chart includes the
three Tax Credit developments that are currently in lease-up.
III-290
The following table summarizes the overall market-rate rental market:
GROSS RENT
BEDROOMS UNITS DISTRIBUTION VACANT PERCENT RANGE
ONE-BEDROOM 938 42.9% 87 9.3% $530-$1,240
TWO-BEDROOM 1,110 50.8% 93 8.4% $533-$1,906
THREE-BEDROOM 132 6.0% 11 8.3% $938-$1,735
FOUR-BEDROOM 5 0.2% 0 0.0% $1,012
TOTAL 2,185 100.0% 191 8.7%
Note the above chart includes market-rate units at market-rate properties and
market-rate units at mixed-income properties (Tax Credit/market-rate). The
distribution of market-rate units is heavily weighted towards one- and two-
bedroom units. Note the above chart includes the one market-rate property
currently in lease-up.
The following table summarizes the family government-subsidized rental
market:
BEDROOMS UNITS DISTRIBUTION VACANT PERCENT
ONE-BEDROOM 188 45.2% 3 1.6%
TWO-BEDROOM 216 51.9% 2 0.9%
THREE-BEDROOM 12 2.9% 0 0.0%
TOTAL 416 100.0% 5 1.2%
The distribution of family government-subsidized units is also heavily
weighted towards one- and two-bedroom units. Demand for larger unit types
appears high with a 0% vacancy rate.
We rated each property surveyed in person on a scale of A through E. All
properties were rated based on quality and overall appearance (i.e., aesthetic
appeal, building appearance, landscaping, and grounds appearance).
Following is a distribution of market-rate properties by quality rating and
units. Note 30 units were surveyed by telephone and were not given quality
ratings.
QUALITY RATING TOTAL UNITS PERCENT
A 454 20.8%
A- 360 16.5%
B 957 43.8%
B- 384 17.6%
NA 30 1.4%
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Following is a distribution of Tax Credit properties by quality rating and
units.
QUALITY RATING TOTAL UNITS PERCENT
A 772 40.2%
B 41 2.1%
F 19 1.0%
N 1,090 56.7%
Following is a distribution of subsidized Tax Credit properties by quality
rating and units.
QUALITY RATING TOTAL UNITS PERCENT
B 48 32.4%
N 100 67.6%
Following is a distribution of government-subsidized properties by quality
rating and units.
QUALITY RATING TOTAL UNITS PERCENT
B 4 1.5%
N 264 98.5%
The following tables summarize the range and median size of the surveyed
units by property type and bedroom type:
TAX CREDIT – NET SQUARE FEET
UNIT TYPE MINIMUM MAXIMUM MEDIAN
ONE-BEDROOM 475 826 686
TWO-BEDROOM 610 1,295 971
THREE-BEDROOM 1,044 1,352 1,190
FOUR-BEDROOM 1,315 1,400 1,393
MARKET-RATE – NET SQUARE FEET
UNIT TYPE MINIMUM MAXIMUM MEDIAN
ONE-BEDROOM 561 1,024 690
TWO-BEDROOM 710 1,555 950
THREE-BEDROOM 1,150 1,348 1,300
FOUR-BEDROOM 1,393 1,393 1,393
GOVERNMENT-SUBSIDIZED – NET SQUARE FEET
UNIT TYPE MINIMUM MAXIMUM MEDIAN
ONE-BEDROOM 564 661 564
TWO-BEDROOM 710 819 727
THREE-BEDROOM 890 1,044 890
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The following tables summarize the distribution of appliances and unit
amenities among all non-subsidized surveyed properties:
APPLIANCES
APPLIANCE PROJECTS PERCENT UNITS
RANGE 28 100.0% 4,107
REFRIGERATOR 28 100.0% 4,107
ICEMAKER 6 21.4% 1,388
DISHWASHER 22 78.6% 3,988
DISPOSAL 23 82.1% 4,029
MICROWAVE 9 32.1% 1,900
UNIT AMENITIES
AMENITY PROJECTS PERCENT UNITS
AC – CENTRAL 28 100.0% 4,107
FLOOR COVERING 28 100.0% 4,107
WASHER/DRYER 4 14.3% 590
WASHER/DRYER
HOOK-UP 21 75.05 3,938
PATIO/BALCONY 21 75.0% 3,725
CEILING FAN 18 64.3% 3,400
FIREPLACE 5 17.9% 1,146
SECURITY SYSTEM 6 21.4% 1,084
WINDOW
TREATMENTS 28 100.0% 4,107
FURNISHED UNITS 2 7.1% 512
E-CALL BUTTON 1 3.6% 22
PROJECT AMENITIES
AMENITY PROJECTS PERCENT UNITS
POOL 21 75.0% 3,938
ON-SITE
MANAGEMENT 26 92.9% 3,965
LAUNDRY 20 71.4% 2,725
CLUBHOUSE 13 46.4% 2,814
MEETING ROOM 6 21.4% 1,130
FITNESS CENTER 8 28.6% 1,346
JACUZZI/SAUNA 5 17.9% 1,264
PLAYGROUND 20 71.4% 3,054
TENNIS COURT 2 7.1% 528
SPORTS COURT 4 14.3% 1,034
STORAGE 7 25.0% 1,524
LAKE 3 10.7% 854
SECURITY GATE 6 21.4% 1,038
BUSINESS CENTER 8 28.6% 1,426
PICNIC AREA 19 67.9% 2,728
SOCIAL SERVICE
PACKAGE 3 10.7% 514
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B. PLANNED MULTIFAMILY DEVELOPMENT
Based on the Texas Department of Housing and Community Affairs allocation
list of affordable multifamily housing projects, there are four Tax Credit
developments that have been allocated but not yet stabilized in the submarket
(this includes two properties that are currently in lease-up). These projects
have been included in our demand analysis.
• Cricket Hollow Apartments: Allocated in 2004, the project will offer 176
two- and three-bedroom units at 50% and 60% AMHI. Cricket Hollow
Apartments opened in October 2005 and is currently 12.5% occupied.
• Tamarac Pines Apartments: Allocated in 2004, this property is an existing
property that will use the Tax Credit funds to perform renovations.
Despite repeated attempts, information was not available for this property.
According to the TDHCA allocation list, this is a 300-unit elderly
property.
• Park at Woodline Townhomes: Allocated in 2004, according to the
TDHCA allocations list, this is a 250-unit property for general households.
A projected opening date was not available.
• Copperwood Apartments: Allocated in 2005, this property targets seniors
age 55 and older. The project will offer 300 one- and two-bedroom units
at 30% and 60% AMHI. A projected opening date was not available.
Montgomery County has neither zoning nor any department that tracks
proposed multifamily properties. Permits for multifamily development in the
unincorporated areas are listed as commercial properties and are rare. The
county representative stated that they had no capacity to separate information
on multifamily permits from the commercial properties, but he also stated that
he does not recall any permits issues in the county recently (approximately the
last 12 months).
C. HOUSING CHOICE VOUCHER HOLDERS
According to the Conroe Housing Authority, there are approximately 286
Housing Choice Vouchers issued in the area. Housing authority
representatives stated that there are approximately 700 people currently on the
waiting list for additional Vouchers. Monthly turnover of persons in the
Voucher program averages five households per month. The payment
standards for Montgomery County are the same as the Fair Market Rent.
PAYMENT STANDARDS
STUDIO UNIT $551
ONE-BEDROOM UNIT $612
TWO-BEDROOM UNIT $743
THREE-BEDROOM UNIT $990
FOUR-BEDROOM UNIT $1,245
III-294
D. HURRICANE IMPACT ON THE RENTAL HOUSING MARKET
Sixteen of the 29 surveyed properties reported a total of approximately 258
hurricane evacuees as tenants. This represents 5.7% of the 4,523 rental
housing units surveyed in the Montgomery Submarket. According to property
managers, there are approximately 255 evacuees (12.1% of affordable units
surveyed) currently being housed at the surveyed Tax Credit properties and
about three evacuees currently being housed at the surveyed market-rate
properties (0.1% of market-rate units surveyed). It appears the hurricanes
have had minimal impact on the market-rate developments, but have had a
significant impact on the affordable rental housing in the Montgomery
Submarket.
According to data provided by HISTA, there were approximately 25,097
renter households in this submarket in 2005. Applying 5.7% to the 25,097
renter households results in as many as 1,430 households living in the
Montgomery Submarket potentially displaced by the hurricanes.
A map indicating the location of apartments surveyed is on the following on
page.
III-295
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DEMAND ANALYSIS – MONTGOMERY SUBMARKET #8
A. DEMAND FOR TAX CREDIT HOUSING
There are no clear or concise methodologies to forecast the need for Tax
Credit housing. This is because housing markets are static with households
often entering and exiting by tenure and economic profile. This position
statement will discuss the potential pitfalls and limitations of various
methodologies and present a recommended solution.
There appear to be only two sources of demand for new Tax Credit housing.
This is represented by a positive increase in income-qualified households
and replacement of functionally obsolete product. The first source of
demand is generally easily quantifiable but presents challenges to accurately
forecast. This is especially true as we get further from the 2000 Census and
development expands into previously undeveloped areas. The problem is
further compounded by the fact that housing market analysts often fail to
analyze income-appropriate household growth by household size.
Projections based only on income often include estimates of smaller
households even though they are over income-qualified due to their
household size limitation (i.e. income analysis based on a five-person limit
set at $46,000 will include two-person households with incomes above their
maximum but below $46,000, thus overstating the number who are
qualified). Therefore, caution should be exercised when considering income
household growth alone.
1. Overstatement of demand
A much larger challenge, and one that creates greater demand for Tax
Credit housing, is replacement of functionally obsolete product.
Unfortunately, measurement of this is very subjective and imprecise.
However, in most inner-city locations or non-growth areas, this is the
only need for Tax Credit units.
The approval of Tax Credit units in these areas has created, in some
instances, an overbuilt market that is characterized by high vacancy rates
and low rents. However, this overbuilding only occurs when there is no
corresponding decline in the existing housing stock. This decline could
occur through demolition or replacement of functionally obsolete
product.
III-297
It is easy to illustrate how a market can be impacted if rental household
growth is minimal. Hypothetically, consider a market that has 1,000
income-appropriate rental housing units (under Tax Credit guidelines)
with a current vacancy rate of 4% (or 40 vacant units). Assume a 150-
unit Tax Credit property of new construction is approved and built. This
market then goes from a 1,000-unit market to a 1,150-unit market.
Without any corresponding increase in income-qualified households or
reduction in the existing supply by demolitions, condominium
conversions, or some other use, the area vacancy rate goes from 4% to
16.5% (40+150/1,150).
This is a very simplistic example but does illustrate the ease at which a
market can get out of balance if it does not experience positive
household growth. In the current environment, this has been
compounded by the fact that some income-qualified households have
left the rental housing market in favor of home ownership, a decline in
younger, first-time renters due to profound demographic shifts, and, in
some markets, a “doubling-up” of households to save on housing costs.
This is particularly true in some inner-city markets where there has been
a decline in the Housing Choice Voucher supply.
This illustration also assumes an isolated market. Households,
particularly rental households, are constantly on the move in response to
jobs, educational opportunities, crime, quality of life, families, church,
and a whole host of other factors. Thus, in the previous market
illustration, this new 150-unit project would likely attract new
households from outside the market as well as households improving
their current housing. This creates vacancies in units with the lowest
quality or in units with the lowest perception of value (i.e. properties
priced well above the market).
If, however, this hypothetical market approved 150-units to either
replace or renovate an existing project (or projects), the market would
remain in balance. The problem for analysts is establishing the
appropriate number of units that should be replaced or renovated.
Projecting too many units yields high penetration rates (the aggregate
number of Tax Credit units compared to the number of income-qualified
households) and precludes reasonable absorption and occupancy levels.
If too few affordable units are developed, the market remains stagnant
and tenants remain underserved.
III-298
2. Methodologies used to date
A variety of methodologies have attempted to tackle this issue.
Substandard units reported in the Census are one source. This is
typically a very small number and does not accurately reflect functional
obsolescence. The number of households who are rent overburdened is
a second factor often considered. However, the Census makes no
distinction for those households who have elected to be rent
overburdened or those who are already housed in Tax Credit properties.
Frankly, a sizeable share of tenants in Tax Credit properties are rent
overburdened since the program does not specify the share of income
used for rent.
We have also reviewed methodologies that use turnover as a measure of
demand. This methodology does nothing to address the issue of a
balanced market. (Turnover is a good tool to forecast absorption of a
project since it considers the number of renters in the market at one time
considering a move).
3. Methodology based on replacement and growth
It is our opinion that the only accurate macro approach to forecasting
Tax Credit demand is to consider both new household growth of
income-qualified households and replacement of functionally obsolete
product. As discussed, household growth is generally easier to forecast
than the number of functionally obsolete units. We propose to forecast
functionally obsolete product by taking a share of the existing rental
product over 35 years old (built in 1970 or older) and in need of
replacement on an annual basis. Considering that the useful life of most
residential product is 40 years, rental product built prior to 1970 can be
considered as being functionally obsolete. The share of the product
functionally obsolete is the issue. It is our opinion that approximately
2.5% (1/40) of the existing rental product that meets this criteria could
be designated as functionally obsolete. This would essentially upgrade
or replace 25% of this older housing stock over a decade, a reasonable
time period.
There are, like all methodologies, some obvious shortcomings. Without
a complete field survey, it is impossible to establish whom this obsolete
product is serving. Given its age, it is most likely serving tenants paying
rents at the lowest third of the rent spectrum. This is likely at rent levels
just below Tax Credit program rents. We argue that for practical
reasons, all of these units would be appropriate to upgrade. Naturally, it
is critical to preserve many of these older units with Rental Assistance.
III-299
Another shortcoming is that this methodology generally precludes older
areas from experiencing new product since household growth is minimal
or nonexistent. We recommend that if a developer builds new product,
there must be a demonstration that a similar number of rental units have
been taken out of the rental base through demolition or conversion to
another use. It is our opinion that there is no benefit to only allow
rehabilitations in older, inner-city areas without a corresponding
decrease in the rental stock. Current new designs are more energy
efficient, are innovative, often incorporate more appropriate allocations
of space, and the use of more desirable unit and project amenities.
4. Conclusions
There have been a wide variety of methodologies employed to address
the component of replacement support for slow or no-growth markets.
Most of these methodologies have used Census data to approximate
demand. Unfortunately, while the methodologies have generated
support numbers that appear reasonable, in practice they have
contributed to overbuilding. The methodology proposed here only uses
two components of demand: new income-appropriate household growth
and replacement or renovation of existing product. We believe this will
provide a more accurate guideline for establishing demand.
It is important to note that any estimate of demand must be verified with
a market study. Further, a development that proposes replacement
support, must demonstrate through the market study or other verification
that there has been a corresponding decline in the existing rental base.
There may be problems reconciling applications responding to new
household growth and those that respond to replacement. Subsequent
“tie-breaker” criteria could be considered to address this issue.
B. DETERMINATION OF INCOME ELIGIBILITY
To determine demand from income-eligible households, we must first
establish the income range required to qualify for residency in Low-Income
Housing Tax Credit (LIHTC) units for the Montgomery Submarket.
1. Maximum Income Limits
Under the Low-Income Housing Tax Credit program, household
eligibility is based on household income not exceeding the targeted
percentage of Area Median Household Income (AMHI), depending
upon household size.
III-300
The Montgomery Submarket has a median household income of $61,000
for 2005 (Harris County). We have analyzed affordable housing
demand for the following income cohorts: 0% to 30% AMHI, 31% to
40% AMHI, 41% to 50% AMHI, 51% to 60% AMHI, 61% to 80%
AMHI, and 81% to 100% AMHI. The following table summarizes the
maximum allowable income by household size for the Montgomery
Submarket at 30%, 40%, 50%, 60%, 80%, and 100% of AMHI.
TARGETED MAXIMUM ALLOWABLE
HOUSEHOLD SIZE AMHI INCOME
30% $12,810
40% $17,080
50% $21,350
ONE-PERSON
60% $25,620
80% $34,150
100% $42,700
30% $14,640
40% $19,520
50% $24,400
TWO-PERSON
60% $29,280
80% $39,050
100% $48,800
30% $16,470
40% $21,960
50% $27,450
THREE-PERSON
60% $32,940
80% $43,900
100% $54,900
30% $18,300
40% $24,400
50% $30,500
FOUR-PERSON
60% $36,600
80% $48,800
100% $61,000
30% $19,770
40% $26,360
50% $32,950
FIVE-PERSON
60% $39,540
80% $52,700
100% $65,900
The calculations presented in the report are based on a five-person
household for the general population (family) and a two-person
household for seniors age 55 and older.
III-301
2. Income-Appropriate Range
Leasing industry standards typically require households to have rent to
income ratios of 27% to 40%. Generally, market-rate properties require
a lower rent to income ratio, while an acceptable rent to income ratio for
low-income units is typically around 35%.
However, to avoid overstating demand at any of the income levels, the
minimum income is calculated as the maximum income of the previous
band, with the exception of the 0% to 30% income band, which has a
minimum income of $0.
C. DEMAND CALCULATIONS
The following tables summarize projected demand for affordable housing
for all renter households from 2006 through 2009. Note the 2005 Baseline
Total Renter Households includes all renter households, while the demand
analysis only considers households earning up to 100% AMHI ($65,900).
Therefore, the total Baseline Targeted Income-Qualified Renter Households
for each income band will not total all renter households. For example,
there were a total of 25,097 renter households in the Montgomery
Submarket in 2005; out of this total, 17,664 were income-qualified renter
households. This results in 7,433 renter households earning above $65,900.
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2005 BASELINE DEMAND – MONTGOMERY SUBMARKET BY GENERAL OCCUPANCY
TARGETED AMHI
APPROPRIATE INCOME RANGE BY TARGETED AMHI 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
1-PERSON ($0-$12,810) ($12,810-$17,080) ($17,080-$21,350) ($21,350-$25,620) ($25,620-$34,150) ($34,150-$42,700)
2-PERSON ($0-$14,640) ($14,640-$19,520) ($19,520-$24,400) ($24,400-$29,280) $29,280-$39,050) ($39,050-$48,800)
3-PERSON ($0-$16,470) ($16,470-$21,960) ($21,960-$27,450) ($27,450-$32,940) ($32,940-$43,900) ($43,900-$54,900)
4-PERSON ($0-$18,300) ($18,300-$24,400) ($24,400-$30,500) ($30,500-$36,600) ($36,600-$48,800) ($48,000-$60,100)
5+-PERSON ($0-$19,770) ($19,770-$26,360) ($26,360-$32,950) ($32,950-$39,540) ($39,540-$52,700) ($52,700-$65,900)
BASELINE TOTAL RENTER HOUSEHOLDS (HISTA DATA) 25,097 25,097 25,097 25,097 25,097 25,097
TARGETED INCOME-QUALIFIED RENTER HOUSEHOLDS
1-PERSON 2,675 739 691 587 1,079 901
2-PERSON 950 405 467 474 831 854
3-PERSON 792 316 308 312 598 507
4-PERSON 631 238 238 256 502 375
5+-PERSON 425 235 273 318 403 284
= BASELINE TARGETED INCOME-QUALIFIED RENTER HOUSEHOLDS 5,473 1,933 1,977 1,947 3,413 2,921
Based on the American Housing Survey, the estimated share of demand by bedroom type and household size in the Houston
MSA is distributed as follows:
DEMAND BY BEDROOM AND HOUSEHOLD SIZE
STUDIO / 1-BR. 2-BR. 3-BR. 4-BR.
1-PERSON HH 67% 25% 8% -
2-PERSON HH 35% 46% 15% 4%
3-PERSON HH 16% 55% 22% 7%
4-PERSON HH 11% 45% 36% 8%
5+-PERSON HH 10% 42% 31% 17%
Source: American Housing Survey (Houston MSA, 1998)
HH-Household
III-303
These percentages, applied to the number of income-qualified renter
households in this submarket, are as follows:
DEMAND BY BEDROOM TYPE AND HOUSEHOLD SIZE
STUDIO /
1-BR. 2-BR. 3-BR. 4-BR. TOTAL
0%-30% 1,792 669 214 0 2,675
31%-40% 495 185 59 0 739
1-PERSON 41%-50% 463 173 55 0 691
HOUSEHOLD 51%-60% 393 147 47 0 587
61%-80% 723 270 86 0 1,079
81%-100% 604 225 72 0 901
0%-30% 333 437 143 38 951
31%-40% 142 186 61 16 405
2-PERSON 41%-50% 163 215 70 19 467
HOUSEHOLD 51%-60% 166 218 71 19 474
61%-80% 291 382 125 33 831
81%-100% 299 393 128 34 854
0%-30% 127 436 174 55 792
31%-40% 51 174 70 22 317
3-PERSON 41%-50% 49 169 68 22 308
HOUSEHOLD 51%-60% 50 172 69 22 313
61%-80% 96 329 132 42 599
81%-100% 81 279 112 35 507
0%-30% 69 284 227 50 630
31%-40% 26 107 86 19 238
4-PERSON 41%-50% 26 107 86 19 238
HOUSEHOLD 51%-60% 28 115 92 20 255
61%-80% 55 226 181 40 502
81%-100% 41 169 135 30 375
0%-30% 43 179 132 72 426
31%-40% 24 99 73 40 236
5+-PERSON 41%-50% 27 115 85 46 273
HOUSEHOLD 51%-60% 32 134 99 54 319
61%-80% 40 169 125 69 403
81%-100% 28 119 88 48 283
0%-30% 2,364 (43%) 2,005 (37%) 890 (16%) 215 (4%) 5,474
31%-40% 738 (38%) 751 (39%) 349 (18%) 97 (5%) 1,935
41%-50% 728 (37%) 779 (39%) 364 (18%) 106 (5%) 1,977
TOTAL (%)
51%-60% 669 (34%) 786 (40%) 378 (19%) 115 (6%) 1,948
61%-80% 1,205 (35%) 1,376 (40%) 649 (19%) 184 (5%) 3,414
81%-100% 1,053 (36%) 1,185 (41%) 535 (18%) 147 (5%) 2,920
OVERALL TOTALS 6,757 6,882 3,165 864
*Due to rounding, some of the above percentages may not total 100%
III-304
MONTGOMERY SUBMARKET
2006 DEMAND
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$20,100) ($13,000-$26,700) ($17,300-$33,400) ($21,700-$40,100) ($26,000-$53,500) ($34,700-$66,900)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 5,473 1,933 1,977 1,947 3,413 2,921
2006 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 5,616 1,974 2,013 1,977 3,501 2,976
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 143 41 36 30 88 55
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (1YEAR) 143 41 36 30 88 55
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 5,473 1,933 1,977 1,947 3,413 2,921
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (1 YEAR) 143 41 36 30 88 55
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2006 5,616 1,974 2,013 1,977 3,501 2,976
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 5,912 2,078 2,119 2,081 3,685 3,133
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2006 5,616 1,974 2,013 1,977 3,501 2,976
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 531 (26.4%) 296 (15%) 308 (8.8%) 262 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 969 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 5,647 1,974 2,544 3,242 3,809 3,238
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 5,912 2,078 2,119 2,081 3,685 3,133
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 5,647 1,974 2,544 3,242 3,809 3,238
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 39 14 14 14 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR) 303 118 -412 -1,148 -124 -105
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 131 45 -152 -394 -43 -38
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 111 46 -162 -463 -50 -43
3-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 49 21 -76 -223 -24 -19
4-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 12 6 -22 -68 -7 -5
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
*Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units
at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
Note specific information on 400 of the 969 units of the above planned and proposed were not available to the analyst. There were two properties with allocations of 250 and 150 units, respectively, in
2004. We have assumed all 400 units will be available at 60% AMHI.
***Estimated based on share of income-qualified renter households up to 60% AMHI.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2007 DEMAND
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$20,400) ($13,200-$27,100) ($17,600-$33,900) ($22,000-$40,700) ($26,400-$54,300) ($35,200-$67,900)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 5,473 1,933 1,977 1,947 3,413 2,921
2007 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 5,760 2,015 2,049 2,006 3,589 3,032
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 143 41 36 30 88 55
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (2 YEARS) 287 82 72 59 176 111
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 5,473 1,933 1,977 1,947 3,413 2,921
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (2 YEARS) 287 82 72 59 176 111
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2007 5,760 2,015 2,049 2,006 3,589 3,032
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,063 2,121 2,157 2,112 3,777 3,191
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2007 5,760 2,015 2,049 2,006 3,589 3,032
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 541 (26.4%) 301 (15.0%) 316 (8.8%) 267 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 969 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 5,791 2,015 2,590 3,276 3,904 3,298
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,063 2,121 2,157 2,112 3,777 3,191
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 5,791 2,015 2,590 3,276 3,904 3,298
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 77 27 28 27 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS) 349 133 -405 -1,137 -127 -107
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 150 50 -148 -390 -45 -38
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 128 52 -160 -459 -51 -44
3-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 57 24 -75 -221 -24 -20
4-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 14 7 -22 -67 -7 -5
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2008 DEMAND
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$20,700) ($13,400-$27,500) ($17,800-$34,400) ($22,300-$41,300) ($26,800-$55,100) ($35,700-$68,900)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 5,473 1,933 1,977 1,947 3,413 2,921
2008 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 5,903 2,055 2,085 2,036 3,676 3,087
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 143 41 36 30 88 55
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (3 YEARS) 430 122 108 89 263 166
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 5,473 1,933 1,977 1,947 3,413 2,921
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (3 YEARS) 430 122 108 89 263 166
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2008 5,903 2,055 2,085 2,036 3,676 3,087
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,213 2,163 2,195 2,143 3,870 3,249
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2008 5,903 2,055 2,085 2,036 3,676 3,087
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 550 (26.4%) 305 (15.0%) 324 (8.8%) 272 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 969 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 5,934 2,055 2,635 3,310 4,000 3,358
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,213 2,163 2,195 2,143 3,870 3,249
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 5,934 2,055 2,635 3,310 4,000 3,358
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 116 41 42 41 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS) 396 149 -399 -1,126 -130 -109
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 171 57 -148 -388 -46 -40
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 145 58 -157 -454 -52 -44
3-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 64 27 -73 -218 -25 -20
4-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 16 7 -21 -66 -7 -5
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2009 DEMAND
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$21,000) ($13,600-$27,900) ($18,100-$34,900) ($22,600-$41,900) ($27,200-$55,900) ($36,200-$69,900)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 5,473 1,933 1,977 1,947 3,413 2,921
2009 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 6,046 2,096 2,121 2,065 3,764 3,142
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 143 41 36 30 88 55
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (4 YEARS) 573 163 144 118 351 221
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 5,473 1,933 1,977 1,947 3,413 2,921
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (4 YEARS) 573 163 144 118 351 221
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2009 6,046 2,096 2,121 2,065 3,764 3,142
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,364 2,206 2,233 2,174 3,962 3,307
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2009 6,046 2,096 2,121 2,065 3,764 3,142
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 560 (26.4%) 310 (15%) 331 (8.8%) 276 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 969 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 6,077 2,096 2,681 3,344 4,095 3,418
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 6,364 2,206 2,233 2,174 3,962 3,307
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 6,077 2,096 2,681 3,344 4,095 3,418
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 155 55 56 55 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS) 442 165 -392 -1,115 -133 -111
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 191 63 -144 -383 -47 -40
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 162 64 -155 -450 -54 -45
3-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 72 30 -72 -216 -25 -20
4-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 17 8 -21 -66 -7 -6
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI.
****Based on share of demand by bedroom type calculated.
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The following tables summarize projected demand for affordable housing for senior households (55+) from 2006 through
2009.
2005 BASELINE DEMAND – MONTGOMERY SUBMARKET BY SENIOR (55+) OCCUPANCY
TARGETED AMHI
APPROPRIATE INCOME RANGE BY TARGETED AMHI 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
1-PERSON ($0-$12,810) ($12,810-$17,080) ($17,080-$21,350) ($21,350-$25,620) ($25,620-$34,150) ($34,150-$42,700)
2-PERSON ($0-$14,640) ($14,640-$19,520) ($19,520-$24,400) ($24,400-$29,280) ($29,280-$39,050) ($39,050-$48,800)
BASELINE TOTAL RENTER HOUSEHOLDS (HISTA DATA) 5,693 5,693 5,693 5,693 5,693 5,693
TARGETED INCOME-QUALIFIED RENTER HOUSEHOLDS
1-PERSON 1,546 459 377 200 312 205
2-PERSON 279 95 103 104 151 174
= BASELINE TARGETED INCOME-QUALIFIED RENTER HOUSEHOLDS 1,825 554 480 304 463 379
Based on the American Housing Survey, the estimated share of demand by bedroom type and household size in the Houston
MSA is distributed as follows:
DEMAND BY BEDROOM AND HOUSEHOLD SIZE
STUDIO / 1-BR. 2-BR.
1-PERSON HH 67% 25%
2-PERSON HH 35% 46%
Source: American Housing Survey (Houston MSA, 1998)
HH-Households
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These percentages, as applied to the number of income-qualified renter
households age 55+ in this submarket, are as follows:
DEMAND BY BEDROOM TYPE AND HOUSEHOLD SIZE
STUDIO /
1-BR. 2-BR. TOTAL
0%-30% 1,036 387 1,423
31%-40% 308 115 423
41%-50% 253 94 347
1-PERSON HH
51%-60% 134 50 184
61%-80% 209 78 287
81%-100% 137 51 188
0%-30% 98 128 226
31%-40% 33 44 77
41%-50% 36 47 83
2-PERSON HH
51%-60% 36 48 84
61%-80% 53 69 122
81%-100% 61 80 141
0%-30% 1,134 (69%) 515 (31%) 1,649
31%-40% 341 (68%) 159 (32%) 500
41%-50% 289 (67%) 141 (33%) 430
TOTAL (%)
51%-60% 170 (63%) 98 (37%) 268
61%-80% 262 (64%) 147 (36%) 409
81%-100% 198 (60%) 131 (40%) 329
OVERALL TOTALS 2,394 1,191
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MONTGOMERY SUBMARKET
2006 DEMAND (55+)
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$14,900) ($13,000-$19,800) ($17,300-$24,800) ($21,700-$29,700) ($26,000-$39,600) ($34,700-$49,500)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 1,825 554 480 304 463 379
2006 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 1,901 580 490 325 482 404
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 76 26 10 21 19 25
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (1YEAR) 76 26 10 21 19 25
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 1,825 554 480 304 463 379
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (1 YEAR) 76 26 10 21 19 25
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2006 1,901 580 490 325 482 404
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,001 611 515 342 507 425
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2006 1,901 580 490 325 482 404
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 129 (26.4%) 49 (15.0%) 42 (8.8%) 36 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 569 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 1,932 580 619 942 524 439
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,001 611 515 342 507 425
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 1,932 580 619 942 524 439
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 10 14 12 8 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR) 79 45 -91 -593 -17 -14
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 54 31 -61 -376 -11 -8
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(1 YEAR)**** 25 14 -30 -217 -6 -6
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI. Further estimated by percentage of renters 55+.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2007 DEMAND (55+)
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$15,100) ($13,200-$20,100) ($17,600-$25,100) ($22,000-$30,100) ($26,400-$40,200) ($35,200-$50,200)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 1,825 554 480 304 463 379
2007 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 1,977 607 499 346 501 429
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 76 26 10 21 19 25
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (2 YEARS) 152 53 19 42 38 50
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 1,825 554 480 304 463 379
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (2 YEARS) 152 53 19 42 38 50
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2007 1,977 607 499 346 501 429
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,081 638 525 364 527 451
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2007 1,977 607 499 346 501 429
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 132 (26.4%) 52 (15%) 44 (8.8%) 38 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 569 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 2,008 607 631 966 545 466
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,081 638 525 364 527 451
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 2,008 607 631 966 545 466
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 19 28 24 15 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS) 92 60 -81 -587 -18 -15
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 63 41 -54 -372 -12 -9
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(2 YEARS)**** 29 19 -27 -215 -6 -6
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI. Further estimated by percentage of renters 55+.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2008 DEMAND (55+)
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$15,300) ($13,400-$20,400) ($17,800-$25,500) ($22,300-$30,600) ($26,800-$40,800) ($35,700-$51,000)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 1,825 554 480 304 463 379
2008 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 2,052 633 509 366 519 453
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 76 26 10 21 19 25
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (3 YEARS) 227 79 29 62 56 74
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 1,825 554 480 304 463 379
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (3 YEARS) 227 79 29 62 56 74
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2008 2,052 633 509 366 519 453
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,160 666 535 386 547 477
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2008 2,052 633 509 366 519 453
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 134 (26.4%) 55 (15.0%) 46 (8.8%) 40 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 569 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 2,083 633 643 990 565 493
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,160 666 535 386 547 477
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 2,083 633 643 990 565 493
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 29 42 36 23 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS) 106 75 -71 -582 -18 -16
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 73 51 -48 -369 -11 -10
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(3 YEARS)**** 33 24 -23 -213 -7 -6
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI. Further estimated by percentage of renters 55+.
****Based on share of demand by bedroom type calculated.
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MONTGOMERY SUBMARKET
2009 DEMAND (55+)
I. GROWTH DEMAND 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
HOUSEHOLD-BASED: ($0-$15,500) ($13,600-$20,700) ($18,100-$25,900) ($22,600-$31,000) ($27,200-$41,400) ($36,200-$51,700)
2005 TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS 1,825 554 480 304 463 379
2009 TOTAL ESTIMATED INCOME-QUALIFIED RENTER HOUSEHOLDS 2,128 659 518 387 538 478
ESTIMATED ANNUAL INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH 76 26 10 21 19 25
NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (4 YEARS) 303 105 38 83 75 99
II. TOTAL UNITS NEEDED FOR BALANCED (95.0% OCCUPIED) MARKET
2005 INCOME-QUALIFIED RENTER HOUSEHOLDS (OCCUPIED UNITS) 1,825 554 480 304 463 379
(+) NEW INCOME-QUALIFIED RENTER HOUSEHOLD GROWTH OVER
PROJECTION PERIOD (4 YEARS) 303 105 38 83 75 99
(=) TOTAL INCOME-QUALIFIED RENTER HOUSEHOLDS IN 2009 2,128 659 518 387 538 478
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,240 694 545 407 566 503
III. EXISTING RENTAL PRODUCT
TOTAL OCCUPIED TARGETED RENTAL UNITS 2009 2,128 659 518 387 538 478
(+) ESTIMATED # OF VACANT UNITS (VACANCY %)* 0 (0%) 0 (0%) 137 (26.4%) 58 (15.0%) 47 (8.8%) 42 (8.8%)
(+) PLANNED AND PROPOSED TARGETED UNITS DURING PROJECTION
PERIOD** 31 0 0 569 0 0
(=) NET EXISTING TARGETED RENTAL PRODUCT 2,159 659 655 1,014 585 520
IV. TOTAL SUPPLY AND DEMAND
TOTAL TARGETED RENTAL UNITS NEEDED FOR BALANCED (95%
OCCUPIED) MARKET 2,240 694 545 407 566 503
(-) TOTAL NET EXISTING TARGETED RENTAL PRODUCT 2,159 659 655 1,014 585 520
(+) 2.5% OF EXISTING RENTAL PRODUCT BUILT PRIOR TO 1970*** 39 56 49 31 0 0
(=) TOTAL TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS) 120 91 -61 -576 -19 -17
STUDIO/1-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 83 62 -41 -365 -12 -10
2-BR. TARGETED UNITS NEEDED OVER PROJECTION PERIOD
(4 YEARS)**** 37 29 -20 -211 -7 -7
Note: 2005 income-qualified households based on 2005 income limits. 2006-2009 income limits projected based on historical increase (2000-2005).
* Units at 0% to 30% and 31% to 40% are assumed to be 100% occupied. The appropriate Tax Credit vacancy rate is applied to units at 41% to 50% and 51% to 60%. The submarket market-rate
vacancy rate is applied to units at 61% to 100%.
**Based on information obtained from TDHCA and local planning officials. Some unit mixes may be estimated. Units under construction at the date of this report were included in the above table.
***Estimated based on share of income-qualified renter households up to 60% AMHI. Further estimated by percentage of renters 55+.
****Based on share of demand by bedroom type calculated.
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D. TAX CREDIT DEMAND SUMMARY
The table below summarizes the preceding demand analysis. Note the net
demand for senior units is included in the total net demand for all Tax Credit
units.
TAX CREDIT (0%-60%) DEMAND SUMMARY
MONTGOMERY SUBMARKET
2006-2009
2006 2007 2008 2009
TOTAL NET DEMAND FOR TAX CREDIT UNITS 0%-40% AMHI 421 483 545 607
TOTAL NET DEMAND FOR TAX CREDIT UNITS 41%-60% AMHI (1,559) (1,542) (1,525) (1,508)
TOTAL NET DEMAND FOR TAX CREDIT UNITS AGE-RESTRICTED TO 55
AND OLDER (0%-40% AMHI) 123 152 181 210
TOTAL NET DEMAND FOR TAX CREDIT UNITS AGE-RESTRICTED TO 55
AND OLDER (41%-60% AMHI) (684) (668) (653) (637)
It is important to note that most of the allocated units are serving households
at 50% and 60% AMHI. There continues to be a need in the submarket for
affordable units targeting households at up to 40% AMHI.
E. SPECIAL NEEDS HOUSEHOLDS
Persons with special needs, as defined by HUD, include persons with
disabilities, persons with HIV/AIDS, elderly persons, frail elderly persons,
persons with alcohol and/or drug addictions, victims of domestic violence,
and public housing residents.
Demand from elderly households was described in the previous section.
Information on persons with HIV/AIDS, alcohol and/or drug addictions, and
victims of domestic violence is typically difficult to obtain. Census data is
available to estimate the number of persons with other types of disabilities.
Based on 2000 Census data, it is estimated those persons age 16+ with a
sensory or physical disability within the Montgomery Submarket are as
follows:
PERSONS WITH DISABILITIES
MONTGOMERY SUBMARKET
NUMBER PERCENTAGE
TOTAL CIVILIAN NONINSTITUTIONALIZED PERSONS 16 YEARS OR OLDER 193,070 100%
SENSORY DISABILITY (BLINDNESS, DEAFNESS, VISION OR HEARING) 7,907 4%
PHYSICAL DISABILITY 17,079 9%
TOTAL PERSONS WITH DISABILITIES 24,986 13%
Source: 2000 Census; Claritas; Vogt Williams & Bowen, LLC
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Note there may be some overlap in the above categories of disability,
causing the total number to appear higher. We have not included mentally
disabled residents since this group does not require a specific housing
product.
According to the 2000 Census, there are 24,986 persons aged 16 and older
with either a sensory or physical disability. It is reasonable to assume
caregivers and/or family members are providing services to these people and
are therefore not in one-person households. According to Claritas,
approximately 21.9% of all occupied housing units are renter-occupied.
Applying this renter percentage to the number of persons with disabilities
results in approximately 5,472 persons with disabilities living in renter-
occupied households. Based on the above analysis, in 2005, approximately
70.4% of all renter households (17,664 income-qualified renter households /
25,097 total renter households) are income-qualified renter households.
Applying 70.4% to the number of persons with disabilities living in renter
households results in 3,852 income-qualified persons with a disability living
in a renter-occupied household. This analysis is summarized below:
TOTAL PERSONS WITH DISABILITIES 24,986
(X) RENTER PERCENTAGE 21.9%
(=) RENTER HOUSEHOLDS WITH DISABLED RESIDENT 5,472
(X) BASELINE TARGETED INCOME-QUALIFIED RENTER HOUSEHOLDS (%) 70.4%
(=) TOTAL INCOME-QUALIFIED RENTER PERSONS WITH DISABILITIES 3,852
APPROPRIATE INCOME RANGE BY
TARGETED AMHI 0%-30% 31% - 40% 41% - 50% 51% - 60% 61% - 80% 81% - 100%
% BASELINE TARGETED INCOME-
QUALIFIED RENTER HOUSEHOLDS 31.0% 10.9% 11.2% 11.0% 19.3% 16.5%
X 3,852 3,852 3,852 3,852 3,852 3,852
TOTAL INCOME-QUALIFIED RENTER
HOUSEHOLDS WITH DISABLED RESIDENT 1194 422 431 425 744 637
The above analysis assumes persons with disabilities have incomes
reflective of the general population. In reality, it is more likely persons with
disabilities will have lower incomes than the general population; therefore,
the above analysis understates the housing required to serve this component
at lower incomes. If units were developed to 100% of the above level, a
large number of vacancies would occur in the market since so many people
are cared for in conventional units.
We recommend a development target no more than 2% of total demand for
special needs households. Due to the limitations of accurate information
available pertaining to special needs households, we strongly recommend
any planned project conduct extensive interviews with appropriate local
service providers, caregivers, medical facilities, etc., to help determine the
demand of special needs households within that market and the type or
characteristics of the housing required.
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At this time, the existing Tax Credit properties in the Montgomery
Submarket contain a total of 156 units for the disabled. Note 2% of 3,852
equals to 77 units.
F. HURRICANE IMPACT ON SUBMARKET HOUSING DEMAND
One major factor impacting the Houston MSA rental housing market at this
time is the evacuees from hurricanes Katrina and Rita. Based on interviews
with local property managers, it appears the hurricanes have had minimal
impact on the market-rate developments, but have had a significant impact
on the affordable rental housing in the Montgomery Submarket. There are
approximately 255 evacuees (12.1% of affordable units surveyed) currently
being housed at the surveyed Tax Credit properties and about three evacuees
currently being housed at the surveyed market-rate properties (0.1% of
market-rate units surveyed). Information from apartment managers varied
as to how many hurricane evacuees will be income-qualified after the
FEMA Vouchers expire. Overall, approximately 198 hurricane Vouchers
will be able to remain in the Tax Credit properties after the hurricane
subsidy expires; this represents approximately 77% of the current hurricane
evacuees.
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