County housing study completed

Posted 1/31/01

County housing study completed

by MaryHelen Swanson

The Chisago County Housing and Redevelopment Authority hired AdMark Resources out of St. Cloud to conduct a study of the housing needs and conditions in Chisago County in response, partly, to a public demand that public officials control what is happening in the housing market.

The cry of the public recently has been to eliminate blight, protect individual investments and slow growth to preserve the countyís natural resources and avoid overcrowding conditions.

Admark was given the responsibility to evaluate the need for additional rental housing in the county, to provide an analysis of the current housing stock and inventory, and to determine gaps or unmet needs.

AdMark was also asked to examine future housing trends and predictions that the county can expect to address in the coming years and to provide a summary of existing resources for housing and resource providers.

Finally, AdMark was asked to give recommendations for new single-family and multi-family housing.

What AdMark found in current housing was that the entire Chisago County region has very few vacancies varying, of course, by community. Overall vacancies are low and if there are vacancies, it is considered to be unusual.
Based on the information gathered, the study areas of North Branch-Harris and Chisago City are being recommended by AdMark as the areas to receive most multi-family housing units because they have predicted increases in population and households.

The study areas of Lindstrom-Center City and Wyoming were also recommended for relatively large numbers of multi-family housing units because of the growth potential and the services those communities provide.

In preparing the study, AdMark used 1980 and 1990 census data, updates and projections from the State Demographerís office, and records and data maintained by the county and city governments.

They also interviewed elected officials and staff from the cities and county, community leaders and people familiar with the areaís housing conditions including bankers, realtors, property managers and developers.

They checked with state and federal housing agencies and also used data from Claritas, a national data reporting service, which uses several sources (many national) in estimating and projecting demographic data.

Population

According to the AdMark report, population statistics for the county study areas indicate an overall growth rate of approximately 48.4 percent between 1990 and 2004.
The largest percentage increase, they figure, will occur in the North Branch-Harris and Chisago City study areas.

North Branch, it is reported, expects a 63.3 percent increase and Chisago City a 59.8 percent increase through 2004.
In numbers these growth totals are 5,641 for the North Branch-Harris area and 3,383 for Chisago City. Much of the population growth in the county, the report goes on, is occurring in the 45-64 year age groups and the 5-17-year-olds.

According to the State Demographic Center, Chisago Countyís population is projected to increase 54 percent from 1995-2025, or from 36,045 to 55,570.

All those people will need a place to live.

Similar to populations, households will increase profoundly. Households, the report notes, are expected to increase an average of 55.8 percent from 1990- 2004.
Again, the greatest rate of increase is expected for the North Branch-Harris, Chisago City areas and also the Stacy area (1990-2004).
North Branch households-67.2 percent
Chisago City-64.8 percent
Stacy-63.6 percent

The North Branch-Harris study area will lead the growth pattern with an expected 2,007 new households, Chisago City with 1,256 and Stacy 1,239.

Employment

AdMark found that overall, Chisago Countyís economy is growing rapidly and steadily, with slight variations depending on specific study areas.

Over 6,300 more workers in Chisago County are employed now than in 1990 and nearly 400 less are unemployed.

Strong pockets of employment can be found in Chisago City, North Branch, Rush City and Wyoming.

AdMark determined that other county cities serve as bedroom communities to larger cities. More detail about employment by job and income is included in the study.

Housing

One apartment building is located in Harris, and a few in North Branch. The study found virtually no vacancies in any of the rental units in this area. The study found no senior market rate units, but acknowledged the construction of the new senor housing complex on Maple Street taking place this year.

Besides showing that the North Branch-Harris study area expects the greatest population growth of the county, it is also the largest workforce area in the county. The study also learned that some employers in this study area feel there is a need for more market rate and affordable housing units.

None of the North Branch area employers are experiencing any downsizing, according to the study.

On the day of the interview, Rush City had 167 rental housing units with only one vacancy. Rush City is one of the few areas where rental housing has been constructed in the past 10 years, including market rate, tax credit and subsidized housing units. There are currently 200 workers at the state prison and majority live more than 20 miles away from their job. The study also found that a majority of Rush City School employees commute as well. One of the reasons, it has been determined, is lack of available housing in the area. As a result, many employers feel there is a definite need for more housing in Rush City.

Stacy has 28 rental units which were interviewed and no vacancies. There are eight general occupancy market rate units and 20 senior subsidized units. Stacy has the lowest rental rate in Chisago County, 8.8 percent.
No vacancies were found in the 69 units interviewed in Taylors Falls and Shafer.
Wyoming has 32 general occupancy market rate rental units and 123 tax credit and subsidized units. All are occupied. During the study, only two vacancies were found out of the 311 rental units in Chisago City. No multi-family units have been built in that city for over 12 years.
In Lindstrom, no multi-family or rental units have been constructed for several years. There is one general occupancy subsidized building and one senior subsidized building in Lindstrom along with four general occupancy market rate apartment buildings, with the most recent being built in 1972.

There are 45 units in these complexes and vacancies are not usually an issue. The other five market rate units were built in the 1900s.
Subsidized housing demand

The formula for determining the demand for subsidized housing involves adding projected household growth, 20 percent of persons living in substandard rental units, any demolition of existing rental stock, 20 percent of persons experiencing rent overburden (paying more than 30 percent of their income for rent) and vacancy, which is considered to be five percent of new household growth. From this total they determine the number of income eligible new households from 1999-2004 based on the percentage of income eligible total households. In Chisago County, a four-person household with an income of $50,200 or less would be eligible for certain government programs. Taking the above total and subtracting the existing subsidized units and any currently being built, the study was able to determine the potential demand for subsidized housing by study area.

Conclusions

The study found that the number of units required to meet the housing demand has not been achieved.

It found that due to increased household incomes and changing lifestyles, there is an increase in rental units.

It concluded that because of current demand and vacancies, no new project will have an adverse impact on any existing properties in the area.
The study also found that while more people are able to afford single-family homes, many others cannot afford to buy a home due to high consumer debt.

And finally, according to realtors and apartment managers, vacancies are filled as soon as they become available making it difficult for area employers to attract new employees because no housing is available.
Although there appears to be a demand for low-income subsidized housing units, none were included in the recommendation tables because, the report notes, reality states that very few if any of these units can actually be built due mainly because the federal programs which funded them in the past have been discontinued. The Rural Development 515 program only provides enough money for one or two housing projects a year.

The study found that rental rates in market rate apartments are high for the area and unrealistic due to the aging nature of most current rental units and the cost to construct new units.

AdMark offers this final word of caution. ìIt is important to note that these recommendations are a conservative estimate of what initial construction should be.î

The report notes that there is a delay in the time it takes for the market to react to the introduction of new housing. The overall market can only absorb so many units at one time, it notes, and an overabundance of construction all at once would have adverse affects on all projects.

ìThe housing situation changes constantly and must be monitored on an ongoing basis.î
Chisago County HRA-EDA will use the information found in this study to guide future policies and efforts aimed at relieving the rental shortage.

Copies of the study can be viewed, and further information available from the HRA-EDA. Call 651-674-5664.