housing in where new hampshire · stay work play nh survey #1 issue for ages 21-39 (not taxes,...

HOUSING IN NEW HAMPSHIRE2020

Russ ThibeaultApplied Economic Research

NHHFA Homeownership ConferenceMarch 3, 2020

WhereAre We?

Who’sFeeling the Pain?

WhereAre We Headed?

WhatCan We Do?

CHAPTER ONE So What’s The Big Problem Here?

2Housing in New Hampshire 2020

By Nearly All Measures, State’s Economy is Healthy and Booming, Matching or Outperforming U.S. Economic Recovery...BUT…


We Are Not Building Enough Units to Address The Economy and Provide Sufficient Housing Choice and Affordable Housing


Like U.S., NH Economy Is StrongNH Employers Have Added 68,000 Jobs Since 2010 –Essentially Lowest Unemployment Rate In The U.S.

580

600

620

640

660

680

700

THO

USA

ND

S

Jobs In New Hampshire


U.S. New Units Permitted RoseAlmost 3-fold Since Economic Recovery Began In 2010

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

US New Housing Permitted


Source: Census Sample Data

Pace of New Housing Permitted in NH Lags Behind The National Housing Recovery

0%

50%

100%

150%

200%

250%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

New Units Permitted

US NH


Source: Census Sample Data

Number of NH New Units Permitted Rising, But Not Fast Enough Or Strong Enough

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000New Units by Permit in NH

Need 2010-2019= 5,500/Year


Current Shortfall Is Extreme• Should have added 5,500+/- units per

year SINCE 2010 to support job growth and provide reasonable housing choice at somewhat affordable prices

• Instead have averaged about 3,100 units

• Leading to a cumulative deficit of about 21,000 units – about 4 years of production

28,400

49,500

21,100

0

10,000

20,000

30,000

40,000

50,000

60,000

Units Permitted Units Needed Deficit

NH Housing Supply & Need 2000-2019


CHAPTER TWOWhat Hath This Wrought?


Impact of the Shortage Is Widespread, But Not Evenly Felt

• Fewer choices and rising costs for renters tend to impact younger cohorts

• Good for landlords and developers tend to be boomers

• OK BOOMER!

• Not enough choices and rising costs for buyers

stress-out millennials and entry buyers but are favorable for sellers – mostly boomers


New Hampshire’s Vacancy Is Currently <1%, 20-Year LowIf the Paint’s Dry, It’s Rented


Rents Never Dipped In RecessionMedian Two-Bedroom Now $1,350, Up 30% Since 2010


Listings (Choice) At Record Low


Prices Hit New Peak, Offsetting Impact of Falling Interest Rates


Buyers Have to Settle For Less


CHAPTER THREE The Consequence: Widespread Cost Squeeze


Over 165,000NH households of state’s total of 528,000 households are overpaying

153,320

374,758

528,078

68,108

97,067

165,175

0

100,000

200,000

300,000

400,000

500,000

600,000

Renters Owners Total

2018 Households

Total Households Paying 30% or More


44% of Renters & 25% of Owner Households Pay More Than 30% of Income for Housing

44%

26%

31%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Renters Owners Total

% of Households Paying 30% or More


All Age Groups Feel the Pain

7,777

14,548

30,847

14,936

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Householder 15 to 24years



Householder 65 yearsand over

Renters Paying 30% or More


Overpayment More Acute for the Young & Old, But Not Exclusively So

54%

40%42%

52%

44%

0%

10%

20%

30%

40%

50%

60%

Householder 15

to 24 years

Householder 25

to 34 years

Householder 35

to 64 years

Householder 65

years and over

Total

% of Renters Paying 30% or More


Doesn’t Matter Much Where You Live

44% 45% 44% 45%

38%

43%45% 44% 43%

46% 44%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Renters Paying 30% or More, 2018


Impact Greatest on Low-Income Owners

90.8%

69.8%

49.2%

34.7%

8.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Less than

$20,000

$20,000 to

$34,999

$35,000 to

$49,999

$50,000 to

$74,999

$75,000 or

More

Household Income

Percent of Owner Households with Cost Overpayment above 30% of 2018 Household Income


Stay Work Play NH Survey #1 Issue for ages 21-39 (not taxes, school quality, available jobs, social life, etc.)

Greater Concord…

Greater Manchester…

Greater Nashua…

Lakes Region…

Monadnock Region…

Mt Washington Valley…

North Country…

Seacoast…

Upper Valley…

UNAFFORDABLE HOUSING




HIGH COST OF LIVING




HIGH COST OF LIVING


Source: New Hampshire Business Review, 2/14/20

CHAPTER FOUR Housing Triage: There Is A Hierarchy Of Pain


Level One: Acute ImpairmentHomeless = Most Severe Need


At Least 1,500 Homeless In NH And No Improvement Yet

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

NH Homeless

Source: HUD, Continuum of Care, Point-In-Time Count = January, Annually


Level Two: Extreme Impairment Paying 50% or More


Burden Falls Heaviest on Those Least Able to Afford ItAlmost 30,000 renter households with incomes under $35,000 pay 50%+ of their income for rent. At best, they have $15,000 left for everything else.

8,469

12,644

8,764

1,705

4…43 0

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Less than

$10,000

$10,000 to

$19,999

$20,000 to

$34,999

$35,000 to

$49,999

$50,000 to

$74,999

$75,000 to

$99,999

$100,000

or More

Household Income

Gross Rent Overpayment at 50% of 2018 Household Income


35,000 Owners Pay 50% or More for Housing

14,053

10,688

5,349

3,493

1,371

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Less than

$20,000

$20,000 to

$34,999

$35,000 to

$49,999

$50,000 to

$74,999

$75,000 or More

Household Income

Owner Households with Cost above 50% of 2018 Household Income


CHAPTER FIVE So What? Where Does This Take Us?


Housing Shortage Contributing to State’s Slower GrowthThis is Not Your Daddy’s Population Growth!

73,700

130,800

182,900

191,400

128,000

76,000

40,000

-

50,000

100,000

150,000

200,000

250,000

1950-60 1960-70 1970-80 1980-90 1990-00 2000-10 2010-18

NH Population Change By Decade


Affordable Housing Shortfall Projected Aging Workforce Will Stymie State’s Economic Growth

-1,361

-10,924

-40,458

65,197

40,516

-60,000

-40,000

-20,000

0

20,000

40,000

60,000

80,000

Under 20 20-34 35-64 65-79 80+

NH Projected Growth by Age 2020-2030


Will We Repurpose Schools?


Will Continue Current Tenure Mix Through 2030

38,300

27,700

10,600

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Total Households Owner Households Renter Households

Household Change By Tenure, 2020-2030


Household Growth Through 2030 Will Favor Smaller Units (+67,000) vs Larger Units (-29,000)

-4,104

13,189

-37,909

23,362

34,375

9,403

-50,000

-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

40,000

Millenials

Under Age 34

First Timers

35-44

Stable 45-64 Downsizers

65-74

Seniors 75-84 Elderly

Household Growth By Age 2020-2030


CHAPTER FIVEWe Need A Diversity Of Housing To Accommodate Lifestyle Changes & State’s Emerging Demographics


“I have lived in a diversity of housing through my lifestyle changes…you

could not build any of these in most New Hampshire communities”

Housing in New Hampshire 2020 39

Chapter Six Addressing The Problem

• Current shortage of about 20,000 +/- units

• 165,000 NH households (30% of state’s 538,000 ) are paying more than 30% of income for housing

• 60,000+ paying 50% or more of income

• Problems are too severe and too pervasive to think in terms of a “solution” anytime soon

• PROBLEMS ARE TOO SEVERE AND PERVASIVE TO NOT BE ADDRESSED


It’s Not Rocket Science!!!


FOR LEVEL ONE – ACUTEHomeless – 1,500+ households

• Market mechanisms can’t touch this issue

• Need integrated hardware (beds) and software (rehab, job training, counseling)

FOR LEVEL TWO – SEVEREPaying 50% or more (60,000 households)

• Market mechanisms can’t touch this issue

• Need new units with deep construction and rent subsidy

• Streamline publicly assisted housing construction process to lower construction costs


FOR LEVEL THREE – SERIOUS30% to 50% (100,000 households)

• Lighten up, dude! If development controls are re-purposed, market can address some of this need• Higher density

• More diversity

• Workforce Housing statute is working, but not enough communities utilize it

• Recognize that new housing is a resource, not a burden

• SAVE OUR SCHOOLS – welcome family housing

• Implement Housing Appeals Board

• Address the student loan issue so burdensome to millennials

• Recruit better paying jobs


In general… recognize that the market can work if not artificially blocked - housing filtering process can help


housing in where new hampshire · stay work play nh survey #1 issue for ages 21-39 (not taxes,...

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