River Cities Housing Market Analysis

River Cities Housing & Development Summit
July 17, 2013
Welcome
and
Intro
Presented by Jeanne Schroer
Agenda
AGENDA
9:00
9:10
10:15
10:45
11:15
11:45
12:15
Welcome and Intro (Jeanne Schroer)
River Cities Housing Market Analysis (Realtor
Roundtable)
Developing a Housing Strategy: Trends &
Opportunities (Jeanne Schroer)
Michael Dinn, Housing Development Strategist/
Market Analyst
Development Tools: Site Readiness (Karen Finan)
LISC Land Data Initiative (Teal Horsman)
Lunch, Discussion, Next Steps
Why ARE
Are We
WHY
WEHere?
HERE?
•  To study the NKY River Cities’ potential to attract new
residents (owners and renters) and retain its existing
homeowners and move up renters
–  Are our weak housing values due to fundamental problems
with our River Cities or is it because we do not have the
product that homebuyers and renters want?
–  What housing strategies make sense given the current
market realities ?
•  Encourage construction of new, infill housing? Is this still the right
approach given our inventory of existing properties needing
attention?
•  Focus on improvement of existing housing stock through rehab and
blight removal?
•  What is the role of quality market rate rental housing in building a
healthy urban housing market?
Why ARE
Are We
WHY
WEHere?
HERE?
•  Housing is an important component of an
economic development strategy – Why?
–  Cutting edge research has quantified:
•  Population, jobs and income go together.
–  Places that attract people also attract jobs and vice versa
•  Knowledge class workers (24-35 year olds) are
important economic drivers
•  Housing vacancy and abandonment are growth
detractors
–  Higher home values create more people and income
–  Poverty rates have negative impacts on population growth
HOUSING AS ECONOMIC DEVELOPMENT
•  Housing has a quantifiable economic impact on a
community – Example:
–  River Cities lost 5,000 residents between 2000-2010
–  What if we got them back?
Earnings Tax Impact # Residents Avg. Income % working locally Payroll Tax Annual Impact Consumer Spending Impact 5,000 $50,000 25% 2% $1,250,000 # Residents Avg. Income 5,000 $50,000 ConsumpEon % 77% Local ConsumpEon % 25% Annual Impact $48,125,000 GOAL
FOCUS ON POTENTIAL; NOT THE PAST
•  Reasons to be positive about the River Cities’
potential:
–  Major demographic, economic and cultural trends
indicate significant future demand for urban living,
working and entertainment spaces
–  NKY River Cities have excellent real estate
fundamentals (location, building stock, natural
amenities)
–  Downtown Cincinnati revitalization initiatives (Banks,
Fountain Square, OTR) are showing positive results
–  New developments under construction (Monmouth Row
and Vue180) indicate developer confidence
DOWNTOWN CINCINNATI IS…
River Cities’ Housing Market Analysis
Presented by Realtor® Roundtable
WHAT IS THE REALTOR® ROUNDTABLE?
•  A group of Realtors® who
have a demonstrated
commitment to the NKY
River Cities
•  We are:
–  Residents
–  Stakeholders
–  Concerned citizens
–  Professionals with a
specialized service focus
in the NKY River Cities
Joy Amann - HUFF
Neil Blunt – Coldwell Banker
Chuck Eilerman – HUFF Commercial
Rebecca Weber – HUFF
Stefanie Adams – HUFF Rehab
Financing Specialist
Fritz Kuhlmann – HUFF
Michael Jackson – Sibcy Cline
We invite others to join us!
WHAT ARE OUR GOALS?
•  Anyone can access the MLS but we are Ambassadors
that educate other Realtors® and their clients about the
positive aspects of urban living. In doing so, we:
–  Promote urban living
–  Promote the NKY River Cities’ diverse culture
–  Create a balance of housing opportunities
–  Encourage home ownership to create community
stakeholders
–  Encourage quality market rate rental product
–  Hold group open houses
–  Network and support fellow Realtors® to sell properties
–  Increase the Cities’ tax base***
Realtor® Roundtable:
Residential Market Data
Data from 1/1/2006 through 03/31/2013
Presented by Rebecca Weber, Huff Realty
SINGLE FAMILY HOMES & CONDOS:
NKY and RIVER CITIES
SINGLE FAMILY HOME & CONDOS
DATA
•  Scope of data is from NKYMLS – Ludlow/
Bromley, Covington North (excludes Latonia,
South Covington and Kenton Hills), Newport,
Bellevue & Dayton
•  Data for the overall NKY area includes Boone,
Kenton and Campbell counties
•  Date range – 1/1/2006 through 3/31/2013
•  Direct sales (“for sale by owner”) not included
in data
NKY HOUSING TRENDS
(SINGLE FAMILY HOMES & CONDOS)
2006
NKY
River Cities
2007
6026
956
2008
5303
821
2009
UNITS SOLD
4629
775
2010
4357
744
2011
3930
590
2012
2013 Q1
3860
583
4482
669
992
165
$3,000
$1,370,000
$3,000
$1,370,000
$3,000
$1,350,000
$3,000
$1,350,000
$4,000
$1,764,000
$4,000
$1,764,000
MINIMUM/MAXIMUM SALE PRICE
NKY
River Cities
$4,000
$1,650,000
$4,000
$1,283,000
$7,000
$1,860,000
$9,200
$1,860,000
$3,000
$3,022,000
$3,000
$3,022,000
$1,500
$1,075,000
$1,500
$978,000
$3,000
$1,700,000
$3,000
$1,700,000
MEDIAN SALE PRICE
NKY
River Cities
$140,000
$141,000
$137,000
$130,000
$130,000
$130,000
$130,000
$128,900
$84,500
$84,000
$84,500
$74,750
$71,700
$60,000
$60,000
$72,000
99
102
92
101
97
130
AVERAGE DAYS ON MARKET
NKY
River Cities
71
65
80
80
90
110
87
82
89
89
RIVER CITIES’ MEDIAN SALE PRICES (SINGLE FAMILY HOMES & CONDOS) LUDLOW
2006
2007
2008
2009
2010
2011
2012
$ 99,500
$ 113,000
$ 92,000
$ 77,000
$ 87,000
$ 58,000
$ 56,000
%Change
2011-2012
%Change
2006-2012
2013 Q1
$
COVINGTON N
$
$
$
$
$
$
$
75,000
67,900
77,500
55,000
47,000
30,000
40,000
NEWPORT
BELLEVUE
DAYTON
$ 91,700
$ 89,000
$ 84,950
$ 102,750
$ 77,000
$ 73,250
$ 94,000
$ 94,500
$ 109,450
$ 112,500
$ 92,950
$ 103,375
$ 90,500
$ 86,500
$
$
$
$
$
$
$
74,350
64,950
66,825
69,700
66,330
71,500
44,500
RIVER CITIES
$
$
$
$
$
$
$
84,500
84,000
84,500
74,750
71,700
60,000
60,000
NKY ALL
$
$
$
$
$
$
$
140,000
141,000
137,000
130,000
130,000
130,000
130,000
(3.4%)
33.3%
28.3%
(4.4%)
(37.8%)
0.0%
0.0%
(43.7%)
(46.7%)
2.5%
(8.5%)
(40.1%)
(29.0%)
(7.1%)
45,000
$
47,500
$ 103,250
$
98,400
$ 129,750
$
72,000
$ 128,900
ANNUAL RESIDENTIAL REAL ESTATE TAX
COST PER $100K MARKET
MORTGAGE RATES AND SALES
River Ci8es Sales 73 62 53 47 57 60 59 73 71 58 55 57 49 Mar-­‐13 Feb-­‐13 Jan-­‐13 Dec-­‐12 Nov-­‐12 Oct-­‐12 Sep-­‐12 Aug-­‐12 Jul-­‐12 Jun-­‐12 May-­‐12 Apr-­‐12 Mar-­‐12 36 Feb-­‐12 39 Jan-­‐12 80 70 60 50 40 30 20 10 0 Monthly Average Mortgage Rates 4.20 3.95 3.91 4.00 3.92 3.89 3.80 3.80 3.68 3.55 3.60 3.53 3.57 3.60 3.47 3.38 3.35 3.35 3.41 3.40 Mar-­‐13 Feb-­‐13 Jan-­‐13 Dec-­‐12 Nov-­‐12 Oct-­‐12 Sep-­‐12 Aug-­‐12 Jul-­‐12 Jun-­‐12 May-­‐12 Apr-­‐12 Mar-­‐12 Feb-­‐12 3.00 Jan-­‐12 3.20 PROFILE OF RIVER CITIES’ BUYERS
WHO IS YOUR CITY ATTRACTING?
DO YOU WANT TO CHANGE OR LEVERAGE YOUR POSITION?
–  $0-49,999 – Investor/speculator - we should be concerned!
–  $50,000-99,999 – Investors, maybe some homeowners
–  $100,000-$149,999 – Young professional, singles or couples
starting a family, empty nesters looking to downsize
–  $150,000-$249,999 – Solid earners with job stability.
Property requires no additional investment.
–  $250,000–no limit – Solid earners with job stability looking for
specific product with amenities and can pay for it. Property
would be perfect!
LUDLOW SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
LUDLOW SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
LUDLOW CONDOS
COMPOSITION OF PROPERTIES FOR SALE & SOLD
LUDLOW
ANALYSIS AND CONCLUSION
–  Ludlow median property sale prices have decreased by 43.7%
(from January 2006 to December 2012)
–  No Active Single Family properties above $150,000 as of March 2013
–  Sales above $150,000 at 2% from April 2012 – March 2013
–  Activity in the $100,000 and below price point for SF homes:
•  Total Inventory - 68%
•  Total Sales - 89%
–  Strengths!
• 
• 
• 
• 
Ludlow Bromley Yacht Club
Circus Mojo
Full range of Community Services (Fire, Police, Schools, Pool, Civic Activities, etc.)
Riverside Market
These assets need to be marketed!
COVINGTON SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
COVINGTON SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
COVINGTON CONDOS
COMPOSITION OF PROPERTIES FOR SALE & SOLD
COVINGTON
ANALYSIS AND CONCLUSION
–  Covington median property sale prices have decreased by
46.7% (from January 2006 to December 2012)
–  Bellevue and Covington only cities with condos below
$100,000
–  Activity in the $100,000 and below price point for SF homes:
•  Total Inventory - 81%
•  Total Sales - 84%
–  Positive Steps Forward!
•  Street improvement/Infrastructure
•  Code Enforcement and Rental Ordinance
•  Current announcement of Downtown development projects
NEWPORT SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
NEWPORT SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
NEWPORT CONDOS
COMPOSITION OF PROPERTIES FOR SALE & SOLD
NEWPORT
ANALYSIS AND CONCLUSION
–  Newport median property sales have increased by 2.5%
(from January 2006 to December 2012)
–  Activity in the $100,000 and below price point for SF homes:
•  Total Inventory - 49%
•  Total Sales - 58%
–  Strengths!
•  Newport is a great benchmark for creating opportunities to create
critical mass resulting in clusters of increased value homes
•  Monmouth St looks great (underground utilities and good mix of
business)
•  New quality rental projects (Monmouth Row and VUE 180)
•  Sustained Proactive code enforcement
•  Quality Housing Authority
BELLEVUE SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
BELLEVUE SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
BELLEVUE CONDOS
COMPOSITION OF PROPERTIES FOR SALE & SOLD
BELLEVUE
ANALYSIS AND CONCLUSION
–  Bellevue median property sales have decreased by
8.5% (from January 2006 to December 2012)
–  Bellevue and Covington only cities with condos below 100,000
–  Make sure the quality of workmanship and mechanics are
sustainable
–  Activity in the $100,000 and below price point for SF homes:
•  Total Inventory - 50%
•  Total Sales - 65%
–  Positive Steps Forward!
•  Revitalization of business district has had a direct and positive
economic impact of home values
•  Incentives to reduce units per structure and increase off street parking
have shown to be effective
DAYTON SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
DAYTON SINGLE FAMILY
COMPOSITION OF PROPERTIES FOR SALE & SOLD
DAYTON CONDOS
COMPOSITION OF PROPERTIES FOR SALE & SOLD
DAYTON
ANALYSIS AND CONCLUSION
–  Dayton median property sales have decreased by 40.1%
(from January 2006 to December 2012)
–  Grant Park and Riverpointe Condos are driving up the median
sales price
–  Currently driving prospective buyers through Ft. Thomas
–  Activity in the $100,000 and below price point for SF homes:
•  Total Inventory - 77%
•  Total Sales - 83%
–  Strengths!
•  Manhattan Harbor
•  Route 8 improvements
•  Historic Preservation Board
TOTAL RIVER CITIES
COMPOSITION OF PROPERTIES FOR SALE & SOLD
TOTAL RIVER CITIES
ANALYSIS AND CONCLUSION
–  River Cities’ median property sales have decreased
by 29.0% (from January 2006 to December 2012)
–  Activity in the $100,000 and below price point for SF
homes:
•  Total Inventory - 69%
•  Total Sales - 75%
–  Strengths!
•  River Cities are part of downtown Cincinnati
•  Offers residential product that downtown Cincinnati does not
have and is being under utilizing
•  Offers lower tax rate than Cincinnati
TOTAL CONDO SALES
COMPARISON
OVER-THE-RHINE
GATEWAY QUARTER CONDOS
3CDC has sold a total of 202 condo units since
2006
–  $184,000 median sale price
–  $222,889 average sale price
–  1,077 average SF
•  Units are beginning to sell again
•  While financing condos is still difficult, lenders
are offering loans