Housing New Hampshire s Workforce Prepared for the New

Housing New Hampshire’s Workforce Prepared for the New Hampshire Workforce Housing Council www. workforcehousingnh. com Presentation to Upper Valley Housing Coalition Lebanon, New Hampshire April 29, 2005 Prepared by Dr. Lisa K. Shapiro, Chief Economist Gallagher, Callahan & Gartrell, P. A. Augusta Boston Concord 800 -528 -1181 shapiro@gcglaw. com

Overview of Study 4 The Data • Key Trends in Housing in New Hampshire § 1990 – 1996 § 1996 – 2001 § 2001 – 2005 4 The Literature • Market Forces • Non-market Forces 4 The Estimated Economic Impacts to New Hampshire • • • Employment Income Gross State Product Sales Tax Revenues gcglaw. com 2

Vacancy Rates and Rental Costs Gross Rental Costs Statewide Vacancy Rate Source: New Hampshire Housing Finance Authority Annual Rental Surveys. gcglaw. com 3

New Hampshire Residential Building Permits 1990 - 2004 gcglaw. com 4

Home Sale Prices vs. Household Income gcglaw. com 5

Changes in Assessment 2000 - 2005 gcglaw. com 6

Affordability of Workforce Housing gcglaw. com Sources and Notes: Dr. Shapiro, Gallagher, Callahan and Gartrell “Housing New Hampshire’s Workforce” March 2005 for the Workforce Housing Council. New Hampshire Economic Labor Market Information Bureau. New Hampshire Occupational Employment and Wages, January 2005, based on the November 2003 survey by the Occupational Employment Statistics (OES) Program. Assessment Divisions of selected communities. Years for previous and current assessments differ across the communities, but all are between 2000 and 2005. Dotted lines represent the affordable home value for a household with one income earning the statewide average salary for that occupation. Affordability calculated here as three times annual income - actual affordability depends on specific income, interest rates, property taxes, debt ratios, household wealth, and etc. Middle, Lower Middle, and Lower refer to the Median House Value (for all homes) in that quintile. 7

Aggregate Housing Demand vs. Housing Supply Forecasted Annual Statewide gcglaw. com 8

Forecasted Housing Demand vs. Housing Supply Annual, By County gcglaw. com 9

Growth in Median Sales Prices Select Upper Valley Communities Sources and Notes: Dr. Shapiro calculations from data from New Hampshire Housing Authority and New Hampshire Office of Energy and State Planning. gcglaw. com 10

Growth in Sale Prices and Housing Units gcglaw. com Sources and Notes: Dr. Shapiro calculations from data from New Hampshire Housing Authority and New Hampshire Office of Energy and State Planning. 11

Purchase Price, Family Income, and Interest Rates 1988 - 2004 gcglaw. com 12

New Hampshire Employer Opinion Polls 2002 and 2005 gcglaw. com 13

New Hampshire Employer Opinion Polls 2002 and 2005 gcglaw. com 14

Non-Market Factors 4 Examples of Regulatory Policies and Practices which Impact Housing Supply • Minimum Lot Size • Building Permit Limitations • Growth Management Ordinances • Impact Fees • Infrastructure Upgrades gcglaw. com 15

Estimating Aggregate Economic Impacts 42 Models (REMI, RIMS II) 43 Approaches (Housing Expenditures, Housing Prices, Construction) 4 Sensitivity Analysis gcglaw. com 16

Results gcglaw. com 17

Average Employment Growth in New Hampshire 2001 - 2004 gcglaw. com 18