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Agenda Item - 2023-04-18 - Number 9.2 - Housing Needs Analysis and Housing Production Strategy - HB 2003
9.2 ,vA E 4\ COUNCIL REPORT �� 0 AEG% Subject: Housing Needs Analysis Update + Housing Production Strategy (House Bill 2003) PP 22-0005 Meeting Date: April 18, 2023 Staff Member: Erik Olson, Long Range Planning Manager Report Date: April 6, 2023 Department: Community Development Action Required Advisory Board/Commission Recommendation ❑ Motion ❑ Approval ❑ Public Hearing ❑ Denial ❑ Ordinance ❑ None Forwarded ❑ Resolution 0 Not Applicable ❑ Information Only Comments: At their meeting on February 21, 2023, the City Council approved a public involvement plan O Council Direction to update the City's Housing Needs Analysis (HNA) ❑ Consent Agenda and develop a Housing Production Strategy to comply with the requirements of House Bill 2003 (HB 2003). Staff Recommendation: Provide direction regarding the findings and assumptions outlined in the draft Residential Buildable Lands Inventory (BLI) and Housing Capacity Analysis (HCA) documents, which are components of the City's HNA update as required under HB 2003. Recommended Language for Motion: N/A Project/ Issue Relates To: Council Initiative to "Complete work on key housing initiatives, including... HB 2003 compliance..." Issue before Council (Highlight Policy Question): Research and long-range planning to update the Housing Needs Analysis and develop a Housing Production Strategy in order to comply with state requirements under HB 2003. (]Council Goals/Priorities: Conserve the community's quality of life by planning for growth and change; complete work on key housing initiatives, including HB 2003 compliance ISSUE BEFORE COUNCIL Staff is seeking direction on the findings and assumptions outlined in the draft Residential Buildable Lands Inventory (BLI) and Housing Capacity Analysis (HCA) documents, which are Respect. Excellence. Trust. Service. 503-635-0215 380 A AVENUE PO BOX 369 LAKE OSWEGO, OR 97034 WWW.LAKEOSWEGO.CITY Page 2 important components of the City's efforts to update its Housing Needs Analysis (HNA) to analyze what housing is needed for current and future residents. The HNA must be adopted by December 31, 2023 in order to comply with the requirements of House Bill 2003 (HB 2003). In addition, HB 2003 requires that cities adopt a Housing Production Strategy (HPS) within one year of the adoption of the HNA that outlines what actions the City will take to address the needs identified. Staff initiated this work in October of last year, and work will simultaneously be conducted on the HNA and HPS through approximately Fall 2024. EXECUTIVE SUMMARY Consistent with the City Council goal to, "Conserve the community's quality of life by planning for growth and change," and the Council initiative to, "Complete work on key housing initiatives, including HB 2003 compliance," staff is engaged in a multi-phased work plan to amend the City's Comprehensive Plan in order to comply with the requirements of the bill. The City is required to adopt an updated HNA by December 31, 2023, and must subsequently adopt an HPS within one year of the updated HNA's adoption. Staff is seeking Council direction on the findings and assumptions outlined in the draft BLI and HCA documents (Attachments 5 and 6, respectively), which are each components of the City's HNA update. The final HNA Report will reconcile these documents through an analysis comparing the amount and type of land available for future residential uses with the amount and types of housing units needed by the City of Lake Oswego over the next 20 years; the Council will then consider whether to adopt the updated HNA at a public hearing on September 5. BACKGROUND Housing Needs Analysis An HNA is a document, incorporated into a city's comprehensive plan by ordinance, which assesses housing need and capacity over the course of a 20-year planning horizon. An HNA must include the inventory, determination, and analysis required under ORS 197.296 (Factors to establish sufficiency of buildable lands within urban growth boundary) (3) In performing the duties under subsection (2) of this section, a local government shall: (a) Inventory the supply of buildable lands within the urban growth boundary and determine the housing capacity of the buildable lands; and (b) Conduct an analysis of existing and projected housing need by type and density range, in accordance with all factors under ORS 197.303 ("Needed housing" defined) and statewide planning goals and rules relating to housing, to determine the number of units and amount of land needed for each needed housing type for the next 20 years. Respect, Excellence. Trust. Servi;.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 3 The City last updated its HNA in 2013 as part of an update to the Comprehensive Plan; the HNA is currently an appendix to the Complete Neighborhoods and Housing chapter of the Comprehensive Plan (see Attachment 1). House Bill 2003 HB 2003 (2019) was adopted by the Oregon Legislature in order to help local jurisdictions meet the housing needs of residents throughout the state by requiring that cities with over 10,000 residents: (1) analyze the future housing needs of their community through an HNA, and (2) develop strategies that promote the development of such needed housing through an HPS. Under the requirements of HB 2003, Lake Oswego is required to adopt an updated HNA by December 31, 2023, and to update its HNA once every six years thereafter. On June 21, 2022, the City Council approved staff's work plan for compliance with HB 2003 including issuing a request for proposals (RFP) to solicit consultant services. Council also committed to appoint an ad-hoc Task Force to provide high-level policy guidance to the Commission and City Council as the City proceeds with HB 2003 compliance. The Commission held their first work session on this subject on June 27, 2022, in order to provide guidance to staff on the proposed work plan prior to issuing the RFP. On October 4, 2022, the City Council adopted Resolution 22-30 in order to create the HPS Task Force and appoint its members (see Attachment 2). The City subsequently contracted with MIG, Inc. (with sub-consultant Johnson Economics) to complete the scope of work outlined in Attachment 3. On January 23 of this year, the Planning Commission held their second work session to receive a presentation from staff and project consultants at MIG outlining the requirements of HB 2003 as related to updating the City's HNA and developing an HPS (see the materials from Planning Commission Work Session #2). The presentation also outlined the proposed public involvement plan in Attachment 4 and included an update on the progress of the HPS Task Force. On February 21, the City Council held a study session to receive similar information and approved the public involvement plan proposed by staff (see the materials from Council Study Session #2). HOUSING NEEDS ANALYSIS: INITIAL DRAFTS This section includes brief summaries of two components of the City of Lake Oswego's HNA update: the BLI and HCA. Buildable Lands Inventory (BLI) Staff and the consultant team have prepared a draft BLI (Attachment 5) to identify land that can be expected to provide residential capacity for the City of Lake Oswego in the next 20 years. The general steps taken to produce the draft BLI include: Respect, Excellence. Trust. Servi;.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 4 • Step 1: Study Area and Land Classification. This step identifies the land in the City that is available for residential uses, using information such as comprehensive plan/zoning designation, ownership information, and tax assessor data. Land that is in public ownership (such as owned by a school district or commonly owned by a homeowner's association) or religious/fraternal ownership is generally not considered available for residential uses. Figure 4: Land Classification is included below, depicting the results of this first land classification step per the methodology in Attachment 5. Figure 4: BLI Land Classification I ,.—rr Study Area i' b• s 4-0 ,ril`• 9 = Lake Oswego City t! rh _ _ _ Limits —, .*� ' Land Type t, f Frn b iiiI '�I�L��i++� a i/A i 1 t.M'!""izl...r,i r Residential MixedUse Public/other �BRgHdi j,� Oak ,� Non-Residential �I �� ■ I�.Lr/7H. d�' y�Adupp'Al FA I Val &Ithabli4lp/P.-- 4.7.1\1:14. ' r 4 � 4, I y a. :0,4 „oat. .sli_r-,....._ :§uvin..iir-..Ist et"A illArtAlwa. .=1-7146iiirailli , a 1 1 , „Li.. t. f reWmali 11 -- EP".11".&771/44, i',/ Alai 11 duz .ToLV•11, -v- : it. feex _.. Ali i wry l•S � � I p 11.75 -... MIles.- ` / °RFGO''.% Lake Oswego Buildable Lands Inventory I Land Type • Step 2: Constraints to Development. This step identifies constraints such as natural resources, steep slopes, and utility easements that may limit development. Land affected by these constraints is totally or partially removed from the inventory. Figure 5: Constraints to Development is included below, depicting the land within the City that would be considered constrained based on the methodology in Attachment 5. Respect. Excellence. Trust. Servi; c:. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 5 Figure 5: Constraints to Development Study Area r t • Lake Oswego City IT i z,,e' Limits {- R! Y'� , ,p li .� ;lt _ Major Roads may: �7t 2 ; .— - - ` Taxlots :'.I''' t.� Z� Greenway Mgmt. Overlay District Slopes>25% . -, _ - nJ FEMA Floodplain pi ` V9 RD •Ir' r^•>, 4` Sensitive Lands Overlay i= eRuSF crnv QF_ - rt qy. Habitat Benefit Areas r= ',EAUo•.vsA., a OHBA) i 1� � r 1R e.C..IN SW FSDNITA RD 1 o. "��� Resource . ' =FI1, Conservation Areas o C' 4' i - (RC) n g,,,rn N Resource Protection N 4.1 _,n J4eE w�" �., oN �� " Areas(RP) V, rrc so,,"" `, - r .. G7 k ENTREE R� e:�;1 �=�ft• F A 7. 7 LLd '� .‘N, � C 1,,.„ 1,L0OKO' :;--i BE R75-RDIII/ "�. ..R L 7 vr`7 LI. I-'.. .v SPn�, n`Fa LE 014 tt Lake Oswego Buildable Lands Inventory Environmental Constraints • Step 3: Development Status. This step assigns a "Development Status" of vacant, partially vacant, or developed tax lots in the inventory. Partially vacant land has an existing structure but is assumed to be available for future infill —for example a single home on a lot that is large enough to accommodate more homes. Figure 6: Development Status of Residential and Mixed Use Land is included below, depicting the development status of each tax lot in the study area as either "Vacant", "Partially Vacant", or "Developed" based on the methodology in Attachment 5. Respect. Excellence. Trust. Servi;.c:. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 6 Figure 6: Development Status of Residential and Mixed Use Land _ • ®study Area •e,L`FJ. 1� '17i SW STEPHENSON ,-T Fq •}``p, Constraints - I _-PP". . °, i Development Status ssE� - z.e AS r a. r o° ' -r,r.i .- b Developed Ao " ^d �a.:a J it 1..- c •, ' r`*-117 --�. - -1 i ir�i►- _ _ _•-A Partially Vacant pT. - �, _ ,`'tk r Vacant } 9 r r �_ ww .- fKq USE WAY .?; _ - A AVE r! t O` L1^.lFl� .y-� • ..•- Cyl SW INITA ISC =-7F 9 5' .,,,• '�•. , ;,'J- •'� 1 .1Y., 1 - ar.Lc R( r 1 i 3 P• rFF O",F,N.2,LVo _ :t Ati- „7" ► P E'L F's M __y _• 1 L' + . LPG SSHUI! \� ._ _ , 'N_ _- •'� .4, c ORE F.N7REE:fl O'i'' �� 4., . N.. . r., I - i r� 1 1 r a / 11� t 'O r I ►. ` aj , . . o S ._.. R r :ti Lp5 4. sF� xo4. \. ~ p CHILOS RO 'I /; u� . :5 01,T = 114 P,' �t .. - / •f; \Oq F GO'''; . r f,0 0.25, .0.5 M1 1 �I. f 'P Lake Oswego Buildable Lands Inventory 1 Development Status • Step 4: Net Buildable Area and Unit Capacity. This step removes land for future rights- of-way and other land needs to provide a net number of acres for each City zoning designation, then estimates number of units. Table 5: Net Developable Acres of Residential and Mixed Use Land is included below, summarizing the net residential developable acres for both residential and mixed use land in the study area in the City, accounting for employment uses on mixed-use land and assumed right-of-way. Table 5:Net Developable Acres of Residential and Mixed Use Land Gross Constrained Unconstrained Developable Unit Capacity Land Type Acres Area (Acres) Area (Acres) Acres Residential 4,413 951 3,547 345 1,218 MixedUse 493 96 399 15 178 Non-Residential 181 21 160 - - Public/Other 3,491 1,309 2,215 - - Total 8,578 2,377 6,320 360 1,396 As outlined in Table 5, above, there are approximately 345 developable acres of residentially-zoned land and 15 developable acres of land zoned for mixed-use, resulting Respect. Excellence. Trust. Servii ,:. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 7 in a total of 360 developable acres within the City. The estimated unit capacity for this area is approximately 1,400 dwelling units. The contents of the draft BLI are intended to be a work in process—they will be refined with feedback from the HPS Task Force, the Council, Planning Commission, and other stakeholders. This inventory will inform both the HCA and HNA Report to provide a picture of the availability of residential land as it compares to the need of certain types of housing units in the next 20 years. Further analysis into potential redevelopment, the characterization of "partially vacant" land, densities, housing mix, and other attributes of the BLI is expected to occur prior to the release of the final HNA Report—tentatively scheduled for July 2023. Housing Capacity Analysis Staff also worked with the consultant team to produce the draft HCA (Attachment 6), which includes research and analysis to outline a forecast of housing need within the City of Lake Oswego by the year 2043. The primary data sources used in generating this forecast were: • Portland State University Population Research Center (current population) • Metro (forecasts of future population) • U.S. Census • Claritas1 • Oregon Employment Department • City of Lake Oswego • Clackamas County • Other sources are identified as appropriate. This analysis relies heavily on Census data from both the 2020 Decennial Census and the American Community Survey (ACS). All Census data feature some margin of error but remain the best source of data available on many demographic and housing subjects. The analysis includes the following components: • A demographic profile, including population growth, income trends, and poverty statistics. See the summaries below in Figure 2.1: Lake Oswego Demographic Profile and Figure 2.9: Commuting Patterns (Primary Jobs), Lake Oswego. 1 Claritas is a third-party company providing data on demographics and market segmentation.It licenses data from the Nielson Company which conducts direct market research including surveying of households across the nation.Nielson combines proprietary data with data from the U.S.Census,Postal Service,and other federal sources,as well as local-level sources such as Equifax,Vallassis and the National Association of Realtors.Projections of future growth by demographic segments are based on the continuation of long-term and emergent demographic trends identified through the above sources. Respect. Excellence. Trust. Service. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 8 Figure 2.1:Lake Oswego Demographic Profile POFULATfON, fiOUSEHOLUS, FAM UUJES,AND YEAR-f OUND 1OUSWG LIMITS 2000 2010 Growth 2023 Growth IlCensusj (Census) 00-10 (PSU) Populations 35,278 36,619 456 41,5.50 13% Households 14,624 15,893 7% 17r481 10% FamiIies3 9,775 10,079 3% 11,.842 17% HousinglJnit.4 15,568 16,995 S% 18,3.45 8% Croup Quarters Pffpulatiflns 163 222 36% 329 48% 1-fausetroJd Size(non-getup? 237 2.29 -3% 2.36 3% Avg. Famr.iy 5+ze 2.93 2.88 -2% 2.37 3' PER CAPITA AND NMFE Atu' HOUSEHOLD INCOME 2000 2010 Growth 2023 Growth I;Census) (Census) 00-10 (Proj.J 10-23 Per Capita?5) $42,166 553,.652 27% $74,600 39% Median HH ($) 5.71,597 584,.186 18% 5123,3.00 46% SOU RCECensus..MetroCanso-lidated Forecast,135.1.1 Population Research Crater,andJohnson Economics Cxnsus Tables: 6P-1(Z006,2010);DP-3(2004 S1901;519301 1From Cells us,PRI Popul atian Resa]rChCenter,grawth rate a010-ZOZZeMtended toZ0Z3 2 2E123 House h l ds=(202 3 population-Group-Quarters Papul ation).202 3 HH Size 3Raboof2023 Families tototaI HH is based on,21721l1i55-year Estimates 42023 housing units a re the'20Cer us total plus new units permitted from 20 through'22(source:Census,CZity) 5 2023 Group Quarters PopuIa4on!lased on S-rearACSestimates 2017-2021 As shown in Figure 2.1, above, Lake Oswego has an estimated current population of 41,550 residents, representing a 13% increase between 2010 and 2023. The average household size in Lake Oswego is currently 2.36 persons per household. Lake Oswego currently has an estimated existing stock of 18,345 housing units, representing an 8% increase since 2010. Respect. Excellence. Trust. Servi;.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 9 Figure 2.9: Commuting Patterns (Primary Jobs), Lake Oswego Met?ger I MilwaukkiieHosp 0 TryonN trtuek l State Milwaukee ara Area 1:31 M iDunthprpe N. r r — Vi, . lard I '4 Oswego 20,900 2,250 • 15,800 Work in Lake Oswego, Live and work Live in Lake Oswego, live elsewhere in Lake Oswego work elsewhere L (Wing Durham ' •II - , ritage Center 90% i / 10% 12% / 88% Jeroriii f ■ j MARYLHURSi i, - c ,River Gro►re 1 -ualatin IAA St-afford Legacy Meridian As shown in Figure 2.9, above, there are approximately 20,900 people who work in Lake Oswego but live elsewhere, 2,250 people who both live and work in Lake Oswego, and 15,800 people who live in Lake Oswego but work elsewhere. • Current housing conditions, including housing tenure (rental/ownership), age of housing stock, unit types, and assisted housing. See the summaries below in Figure 3.1: Estimated Share of Units by Property Type, 2023, and Figure 3.4: Current Inventory by Unit Type, by Share. Respect. Excellence. Trust. Servi;.c:. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 10 Figure 3.1:Estimated Share of Units by Property Type, 2023 Lake Oswego, Oregon 80% 63% 60% 40% 21% y 20% p} 6% 1% 0% 0% 0% Single Single Duplex 3-or 4-plex 5+Units Manuf_ Boat, RV, Detached Attached MFR home Other temp As shown in Figure 3.1, above, 63% of the existing housing units in Lake Oswego are single-family detached housing, with 21% of existing units provided in multi-family residential buildings of 5 or more units. Figure 3.4: Current Inventory by Unit Type, by Share Number of Bedrooms 5 or more 1% Renter 11% Owner 4 bedrooms 5511 39 3 bedrooms 19% 33% 2 bedrooms 1 -•mm- 43 14% 1 bedroom 1 27% r Studio 6% }q� 0% 1(yam{ 20% 30% 40% 50% if fP 1()% Respect. Excellence. Trust. 5ervi,.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 11 As shown in Figure 3.4, above, the number of bedrooms for housing units in Lake Oswego differs between units available for rental and those available for ownership. For example, 43%of the housing units available to renters are two-bedroom units, and 27% of those rental units are one-bedroom units. On the other hand, 43% of owner- occupied housing units are four-bedroom units, and 33%of owner-occupied units are three-bedroom units. These numbers illustrate that owner-occupied housing tends to be larger and contain more bedrooms than housing units on the rental market. • An assessment of current housing demand, based on population characteristics and the availability of housing units. See the summaries below in Figure 4.1: Current Lake Oswego Housing Profile (2023) and Figure 4.2: Estimate of Current Housing Demand in Lake Oswego (2023). Figure 4.1: Current Lake Oswego Housing Profile(2023) CURRENT HOUSING CONDITIONS (2023) SOURCE Total 2023 Population: 41,550 PSLtPop.Research Center - Estimated group housing population: 329 (0.8%ofTotal) US Census Estimated Non-Group 2023 Population: 41,221 (Total-Group) Avg. HH Size: 2.36 US Census Estimated Non-Group 2023 Households: 17,481 (PopfHHSize) Total Housing Units: 18,345 (Occupied+Vacant) Census 2010+permits Occupied Housing Units: 17,481 (=#of HH) Vacant Housing Units: 864 (Total HH-Occupied) Current Vacancy Rate: 4.7% (Vacant units/Total units) Respect. Excellence. Trust. Servi,.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 12 Figure 4.2:Estimate of Current Housing Demand in Lake Oswego (2023) Ownership Price Range #of Income Range %of Cumulative Households Total $0k-$80k 330 Less than$15,000 2.7% 2.7% $80k-$130k 267 $15,000-$24,999 2.2% 4.9% $130k-$180k 357 $25,000-$34,999 2.9% 7.8% 5180k-$250k 636 $35,000-$49,999 5.2% 13.0% $250k-$350k 1,051 $50,000-$74,999 8.6% 21.7% $350k-$440k 1,147 $75,000-$99,999 9.4% 31.1% $440k-$510k 1,109 $100,000-$124,999 9.1% 40.2% 5510k-$560k 892 $125,000-$149,999 7.3% 47.5% $560k-$680k 1,827 $150,000-$199,999 15.0% 62.5% $680k+ 4,577 $200,000+ 37.5% 100.0% Totals: 12,191 %of All: 69.7% Rental Rent Level Hof Income Range %of Cumulative Households Total _ $0-$400 348 Less than$15,000 6.6% 6.6% $400-$700 383 $15,000-$24,999 7.2% 13.8% $700-$900 554 $25,000-$34,999 10.5% 24.3% 5900-51300 621 $35,000-$49,999 11.7% 36.0% $1300-$1800 837 $50,000-$74,999 15.8% 51.9% $1800-$2200 764 $75,000-$99,999 14.4% 66.3% $2200-$2500 505 $100,000-$124,999 9.6% 75.9% $2500-$2800 410 $125,000-$149,999 7.8% 83.6% $2800-$3400 271 $150,000-$199,999 5.1% 88.7% $3400+ 596 $200,000+ 11.3% 100.0% All Households Totals: 5,290 %of All: 30.3% 17,481 As shown in Figure 4.2, above, approximately 70% of households in Lake Oswego live in owner-occupied housing, and approximately 30% of households live in rentals. Among owner-occupied housing units, the highest proportion - 37.5%- is available to households at the highest end of the income-range, or households earning $200,000 or more annually. Among rental housing units, the highest proportions are the 15.8% of units available to households earning between $50,000 and $74,999 annually, and the 14.4% of units available to households earning between $75,000 and $99,999 annually. • An assessment of future housing need, based on forecasted population growth and a variety of other anticipated demographic and housing market trends. See the summaries below in Figure 5.1: Future Housing Profile (2043), Lake Oswego, and Figure 5.2: Projected Occupied Future Housing Demand(2043), Lake Oswego. Respect. Excellence. Trust. Servi;.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 13 Figure 5.1:Future Housing Profile (2043), Lake Oswego PROJECTED FUTURE HOUSING CONDITIONS (2023- 2043) SOURCE 2023 Population(Minus Group Pop.) 41,221 (Est.2022 pop.-Group Housing Pop.) PSU Projected Annual Growth Rate 0.05% metro Coordinated Forecast(2021) Metro 2043 Population(Minus Group Pop.) 41,629 (Total 2043 Population-Group Housing Pop.) Estimated group housing population: 332 1.7%of total pap.(held constant from 2022) US Census Total Estimated 2043 Population: 41,961 nnetroCoordinated Forecast(202i) Metro Estimated Non-Group 2043 Households: 19,298 Metro Coordinated Forecast(2021) Metro New Households 2023 to 2043 1,816 Avg. Household Size: 2.16 Projected 2043 pop./2043 houseolds US Census Total Housing Units: 20,313 Occupied Units plus Vacant Occupied Housing Units: 19,298 (=Number of Non-Group Households) Vacant Housing Units: 1,015 (=Total Units-Occupied Units) Projected Market Vacancy Rate: 5.0% Stabilized vacancy assumption As shown in Figure 5.1, above, the estimated population in Lake Oswego for 2043 is 41,961 residents, with an average household size of 2.16 persons per household. This represents a relatively modest projected annual growth rate of 0.05%, which is much lower than the amount of growth the City experienced in the last few decades. The decrease in household size from 2.36 (2023) to 2.16 (2043) is also notable, as even though the growth rate is expected to decrease, the number of persons per household is also expected to decrease. This results in a projection of more new households than new residents over the 20-year study period, with 1,816 new households projected in the City by 2043, and an estimated need for 20,313 housing units in total. Respect. Excellence. Trust. Servi;.c:. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 14 Figure 5.2:Projected Occupied Future Housing Demand(2043), Lake Oswego Ownership #of Price Range Income Range %of Total Cumulative House holds $0k-$80k 364 Less than$15,000 2.7% 2.7% • remelt' <30% MFI $80k-$130k 295 $15,000 -$24,999 2.2% 4.9% Low Income $130k-$180k 394 $25,004-$34,999 2.9% 7.8% Very Low a50% MFI $180k-$250k 702 $35,000-$49,999 5.2% 13.0% Income $250k-$350k 1,160 $50,000 -$74,999 8.6% 21.7% Low Income <80% MFI $350k-$440k 1,266 $75,000 -$99,999 9.4% 31.1% $440k-$510k 1,224 $100,400 -$124,999 9.1% 40.2% $510k-$560k 984 $125,000-$149,999 7.3% 47.5% $560k-$680k 2,017 $150,000 -$199,999 15.0% 62.5% $680k+ 5,053 $200,000+ 37.5% 100.0% Totals: 13,458 %of All: 69.7% Rental if of Rent Level Households Income Range %of Total Cumulative $0 -$400 385 Less than$15,000 6.6% 6.6% ` Extremely <30% MFI $400 -$700 423 $15,000-$24,999 7.2% 13,8% Low Income $700 -$900 611 $25,000-$34,999 10.5% 24.3% Very Low <50% M F I $900 -$1300 686 $35,000 -$49,999 11.7% 36.0% Income $1300 -$1800 924 $50,000 -$74,999 15.8% 51.9% Low Income <80% MFI $1800 -$2200 843 $75,000-$99,999 14.4% 66.3% $2200 -$2500 558 $100,000 -$124,999 9.6% 75.9% $2500 -$2800 453 $125,000-$149,999 7.8% 83.6% $2800 -$3400 299 $150,400-$199,999 5.1% 88.7% $3400 + 658 $200,000+ 11.3% 100.0% All Units Totals: 5,840 %of All: 30.3% 19,298 As shown in Figure 5.2, above, the majority (51.9%) of the demand for rental housing units is projected to be for households categorized as either low income, very low income, or extremely low income. Only 21.7%of the demand for owner-occupied units is projected for households in these same income ranges. After receiving feedback on the BLI and HCA, the next step for the project team will be to conduct an analysis that compares the amount and type of land available for future residential uses with the amount and types of housing units needed by the City of Lake Oswego for the final HNA Report. The findings of this comparison will form the basis of further work about the policies, programs, and actions that the City can consider to address its current and future housing needs through the HPS. Respect. Excellence. Trust. Servi,.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 15 PUBLIC ENGAGEMENT UPDATE The following events have occurred in the time since the Council's last study session on February 21 related to this project: • On March 20, the draft BLI and HCA documents were distributed to City-recognized Neighborhood Associations, City Boards and Commissions, and interested members of the public for their input and review; • On March 24, the HPS Task Force held their second meeting to review and provide input on the initial drafts of the BLI and HCA documents; • On March 31, the City released an Online Open House that explains the information in the draft BLI and HCA documents and allows for public input through April 21; and • On April 6, the City hosted a virtual Community Forum to provide information and receive direct public input on the draft BLI and HCA. The final HNA Report, which will include the BLI and HCA as components, is tentatively scheduled to be considered by the Planning Commission at a public hearing on July 24, and by the Council at a subsequent public hearing on September 5, 2023. QUESTIONS FOR COUNCIL Staff is seeking direction from Council related to the following questions: • Do the findings related to the amount of land available for housing development in the BLI seem reasonable, or are adjustments needed? • Do the projections of housing need in the HCA seem reasonable, or are adjustments needed? ATTACHMENTS This staff memo and all attachments referenced below can be found by visiting the Planning Project webpage for the case file. Due to file size, attachments are available in the "Public Records Folder" using this link: https://www.ci.oswego.or.us/planning/pp-22-0005-housing-needs-and-production-strategies 1. City of Lake Oswego Housing Needs Analysis, 03/19/2013 2. Adopted Resolution 22-30, 10/04/2022 3. Project Scope of Work, 10/17/2022 4. Draft Public Involvement Plan, 01/10/2023 5. Draft Lake Oswego Residential Buildable Lands Inventory, 03/17/2023 **ATTACHED** 6. Draft Lake Oswego Housing Capacity Analysis, 03/20/2023 **ATTACHED** Respect, Excellence. Trust. Servi;.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY Page 16 To view these documents and other documents in the public records file, visit the Planning Project webpage: https://www.ci.oswego.or.us/planning/pp-22-0005-housing-needs-and-production-strategies Respect. Excellence. Trust. Servi,.c. 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY ATTACHMENT 5 LAKE OSWEGO RESIDENTIAL BUILDABLE LANDS INVENTORY DRAFT Methodology and Initial Results I March 17, 2023 Introduction This memorandum provides a Residential Buildable Lands Inventory(BLI)for the City of Lake Oswego, which will support the creation of a Housing Needs Analysis (HNA)for the City.The methodology for this BLI is based on the 2018 Metro BLI1 with further refinements through review and discussions with City staff. The BLI is conducted in the following steps: • Step 1:Study Area and Land Classification.This step identifies the land in the City that is available for residential uses. • Step 2: Constraints to Development.This step identifies constraints such as natural resources, steep slopes, and utility easements that limit development. • Step 3: Development Status.This step assigns a "Development Status" of vacant, partially vacant, or developed tax lots in the inventory. • Step 4: Net Buildable Area and Unit Capacity.This step removes land for future rights-of-way and other land needs to provide a net number of acres for each City zoning designation,then estimates number of units and mix of unit type (single detached, multi-dwelling, middle housing) expected based on the results of Step 4. Step 1 : Study Area and Land Classification Study Area The study area for this analysis is shown in Figure 1.The study area includes land within the Lake Oswego City Limits and unannexed areas with City of Lake Oswego Comprehensive Plan designations. 1 https://www.oregonmetro.gov/sites/default/files/2018/07/03/UGR Appendix2 Buildable Lands Inventory.pdf PP 22-0005 ATTACHMENT 5/PAGE 1 OF 18 Figure 1.Study Area Map r_,.,....„, 1SW5TEHENSUN5T f`A 6L - 9 q � <tD o D._. yy1G J ` II fir`= ~i J 7 :y 1 MELROSE ST : Oar .s,5 Q LOUN7R y G o "'� r. -` 4 CUS RD C C]❑ f 4 0 Mx, KAUSE WAY -0 y A Avt y i n' MEADOWS ft° v p4' 2 A�1 cS O . �pUNTAiry / SW RaN1T]A R` U .-P'�CA¢ QG �N BiVD J 7 U'' �YL s, sF F �'D 1 a a + cc kLIA F-L6,,,,,r,u,,,lThio 3 C� Q ..BLVD PE- 16 UQPER`,,„,1E y410RE Q1v „OJ,, v .,.. .1 q GREENTREE S� ¢� gyp$ v 5 D;.)1# N �4 Y� y R x w LOOKp S-flRG15R0 ` JEli' c�i1 3 0 C _ S� � AY t s. - E. z a ��R GI. a } yk -Po 44p tOf J :CHIEDS RD i - yT, -- tt•-• ■ PO U ` I +Miles' � CREGc% • 0 0.25 0.5 1 Study Area 77 Lake Oswego City Limits Land Classification Parcels in the inventory are categorized based on their Comprehensive Plan and Zoning designations, property ownership, and other characteristics available in City/regional datasets.These classifications are described in Table 1 and shown in Figure 4. Comprehensive Plan and Zoning Districts The City of Lake Oswego's Comprehensive Plan Districts are described in Table 1.This is the primary basis for classifying lands into the categories of Residential, Mixed-Use, Nonresidential, and Publicly Owned/Other. Alignment with Zoning Districts are shown in the "Implementing Zones" column. Zoning and Comprehensive Plan map designations are shown in Figures 2 and 3, respectively. Overarching categories of land and how they are considered in this inventory are described on the pages following those figures. PP 22-0005 ATTACHMENT 5/PAGE 2 OF 18 Table 1. City of Lake Oswego Comprehensive Plan and Zoning Districts Comprehensive Plan Implementing Zone Purpose Designations Zones R-15 To provide lands for single-family residential development with Residential Low R-10 densities ranging from two to five dwelling units per gross Density acre,and to provide lands for middle housing development. R-7.5 To provide lands for single-and multi-family residential R 5 development with densities ranging from seven to eight dwelling units per gross acre,and to provide lands for middle housing development. (1) The purpose of the R-DD zone is to assure that both single-family homes and middle housing are protected from noise,light,glare and reduction in privacy to the maximum extent possible during the area's transition to higher density residential use,to facilitate good architectural design and site planning which maintains residential choices of unit size,cost and other amenities R-DD Zone and supports the economic feasibility of new construction and development,and to assure protection and compatibility of all land uses,including commercial, residential,park,open space and historic sites. (2) The R-DD zone is intended for use in low density residential districts which are undergoing transition to increased densities,and which have scenic,historic, natural or residential features which should be preserved and integrated with new development. Residential The FAN R-6 zone is intended to implement the land use Medium Density policies of the First Addition Neighborhood Plan.The purpose of this zone is to ensure the design quality of proposed development in the neighborhood by: (1) Ensuring that proposed building designs are visually compatible with the character of existing structures,maintain adequate light and air between structures,and complement the neighborhood's architectural character. (2) Minimizing the visual impact of garages from the street, and to continue established alley uses and functions such as R-6 access to garages,off-street parking and trash removal. (3) Encouraging compatible and sensitive remodeling and renovation of existing residences. (4) Preserving the small-town character of the existing streetscape by allowing single-family and middle housing development that is human scale and pedestrian oriented. (5) Enhancing the natural environment of the neighborhood as one of the dominant characteristics. (6) Preserving FAN's historical and architectural character by encouraging infill development that is compatible in design character to landmark structures on abutting lots. Residential High R-3 To provide lands for single-and multi-family residential Density R-2 development with densities of at least 12 dwelling units per PP 22-0005 ATTACHMENT 5/PAGE 3 OF 18 Comprehensive Plan Implementing Zone Purpose Zones Designations R-0 gross acre,and to provide lands for middle housing development. R-W Neighborhood To provide land near residential areas for lower intensity Commercial(NC) commercial activities that primarily serve the surrounding neighborhood,smaller public facility uses,and residential uses. To provide lands for a mix of higher intensity commercial General activities supplying a broad range of goods and services to a Commercial(GC) market area approximately equal to the planning area identified in the Comprehensive Plan,as well as residential, public facilities,and cultural uses. To provide lands for commercial activities which meet the Highway needs of the traveling public as well as other highway-oriented Commercial(HC) retail uses which require access to a market area larger than the general commercial zone.This zone is not intended for regional shopping centers. To provide for a mix of uses requiring highway access and Mixed which provide a strong visual identity.Intended uses include Commerce(MC) local and regional convention type facilities,office uses and Commercial supporting retail uses. Office Campus To provide lands for major concentrations of regionally- (OC) oriented offices and employment opportunities for a market area larger than the planning area. Campus To provide a mix of clean,employee-intensive industries, Research and offices and high-density housing with associated services and Development retail commercial uses in locations supportive of mass transit (CR&D) and the regional transportation network. The purpose of the CI zone is to provide zoning regulations for Campus the Marylhurst Campus in order to provide land where Institutional(CI) permitted or conditional uses can be provided for in a unified campus setting. To implement Comprehensive Plan policies applicable to the East End General Downtown Town Center and to provide land for a mix of Commercial(EC) higher intensity commercial,residential,and cultural uses and public facilities that support a traditional downtown commercial core. Industrial Zone The purpose of the industrial zone is to provide land where (I) general industrial development can be located. Industrial To provide lands where primarily light industrial and Industrial Park employment uses can occur in a campus-like setting under Zone(IP) controls to make activities mutually compatible and also compatible with existing uses bordering the zone. West Lake Grove To provide zoning for townhome residential,commercial,and Zones mixed-use development in the West Lake Grove District that (Townhome accommodates lower intensity commercial,public facility and Residential- residential uses;and to provide a transition between the Lake Mixed Use WLG R-2.5, Grove Village Center and adjacent residential neighborhoods. Residential These districts are intended to supply services to a market area Mixed Use-WLG that is comprised of adjacent neighborhoods. RMU,and Office- Commercial- WLG OC) PP 22-0005 ATTACHMENT 5/PAGE 4 OF 18 Comprehensive Plan Implementing Zone Purpose Zones Designations To foster a mix of housing,retail and office uses in a central location proximate to downtown and along the Willamette River.Commercial uses are allowed but are not intended to dominate the character of the area. Retail uses are limited in size to complement the downtown core and facilitate the development of neighborhood-focused retail served by transit. The design and development standards are intended to create a unique Lake Oswego community.The emphasis of the zone is on residentially related uses. The Foothills Mixed Use code provisions are intended to: Foothills Mixed i. Connect the FMU area with downtown,Tryon Creek,Old Use(FMU) Town,the Willamette River and Oswego Lake; ii. Create a sustainable walkable neighborhood that possesses a thriving,active,and comfortable pedestrian environment; Hi. Create visual interest through varied building heights that are urban in character,yet include detailed amenities at the ground floor that enhance the pedestrian environment; iv. Create high quality buildings,of long lasting materials,to promote the permanence of the community; v. Allow for a mix of residential uses,with urban density,and neighborhood scale retail and office development;and vi. Establish a standard of design that reinforces Lake Oswego's sense of place. The Public Functions(PF)zone is intended to specify Public Use Public Functions appropriate land uses and development standards for public (PF) uses,such as government services,education,and similar activities. The purposes of the Park and Natural Area(PNA)zone are to: i. Protect,preserve,conserve and enhance natural areas, greenways and parks; ii. Permit a wide range of passive and active recreational Park and Natural Park and Natural uses,and accessory uses,on property for the future use and Area(PNA) Area(PNA) enjoyment of the City and its residents; iii. Implement Statewide Planning Goal 8,Recreational Needs;and iv. Establish a master plan process for park planning and development. PP 22-0005 ATTACHMENT 5/PAGE 5 OF 18 Figure 2. City of Lake Oswego Zoning Designations 1 Portion:: o- Cornmu d 224 . ttl. College--Syls.a I'.: , Lyon Creek ' rate Na Rural a_ I ~ m PNA. N , S -,r eta:..E. H I 5 q 1' i ,iH o, R_5 PNA - Milwaukie • Tigard oa Mimif r� 1#� ri �i�� R-io (� R 5 I '� d R-6 Oak Grave P P.e� �� 11i .I f��A. PNA R ro a DEC Bonita 4phit,ir, . o sW 6an to Rd ' • R.7.s Sin _ e.,.. r. rlit . SW Durham r. e I R- MI 1101- io R i' • 2 Concord R-7 5 -P Cook Park Durham 1 o PNA ' - CI Trolley Trail ' R.ye ii� -4,� J alatin • 'I i' PNA�� -�1�r1 uryy Club P _ O n Rs5 t Jer R-rs Esri,NASA,NGA,USGS,FEMA,Oregon Metro,Oregon State Parks,State of Oregon GEO,Esri.HERE, TIM Iarir PNA II 1 Rivergrove I_ I parmin,SafeGraph,Grechnologies,Inc,METIINASA,USG 5,Bureau of Land Management,EPA,IPS. USDA Mary S.You riq Lake Oswego- Buildable Lands Inventory-Zoning Districts Legend =Lake Oswego =NC 'F CI R-6 LATER 0 I 'PJA 0 R-7.5 ▪CI ®IP R-0 ©R•DD MI Cl/CRC 0 MC R-LA ®R-IS MI CR&D (]NC .J R-1.5 I I VLGOC l=EC =NCfR-0 -R-2 =INLG R-2.5 —EC/12-0 0 DC 0 R-3 0 AILS RMu 0 0.25 0.5 1 O GC 0 cC/R-3 0 k-s Miles PP 22-0005 ATTACHMENT 5/PAGE 6 OF 18 Figure 3. City of Lake Oswego Comprehensive Plan Designations Portlandrill p i 224 Commune yVW '' I ) CoRege-Sylva Tryon Creek _ i• Y i Slate Natural a. I ( iu 1111 &A Sr 1. illili .,• is. SP .sr_ 'Ra :1 ; 141 rr tilll . C}` i' ' i'.L - r5 Milwaukee i V .R ` tr-�o.♦ v Heights Tigard rr D°� �o -� ;iiiiY���� :.� ry 111 F ►.r' . R-6 d Oak Grave 1- �r� §f rk Bonita SW He ne Rd .42k -34'' v it, SW❑urharn RdI1/1p1;: R_y,5 di .2 I.0 Concord R i5R. Cl : "A� Trolley Trail _aok Park Durham i Rno Pfl� Ii.:' � ?• aiaten 440111 •r �� , - 'try Club .. ao R-as I t � L Jer -� fta5 Esri,NASA,NGA,USGS,FEMA,Oregon Metro,Oregon state Parks,State of Oregon GEO,Esri,HERE, Tualatin I Riverg rove Gamin.SafeGraph,Ggaiechnalogies,Inc,METIINASA.USGS,Bureau of Land Management,EPA,NIPS, USDA c' Mary S.Young. Lake Oswego- Buildable Lands Inventory-Comprehensive Plan Designations legend 0 Lake Oswego 0 HE 0 PHA O R•7.5 LAYER 0 IP =R-n il R-W MI CI 0 MC 0 it-to Mg SP Ml CRe) 0 NC =R-15 ©Win OC ®EC =NC/R-0 O R-2 p P&G R-2.5 MI EC(R-a O IC O R-3 0 WLG RMU dFtau C]ogR-3 CI ♦maltothervalues, 0 0.25 0.5 1 =GC OPP 11R-6 Miles Residential Land Residential Land is intended to meet the City's need for residential uses of various types. It includes land within the R-0, R-2, R-3, R-5, R-6, R-7.5, R-10, R-15, R-W, and WLG R-2.5 Comprehensive Plan designations, unless it meets the criteria for"Publicly Owned/Other" land. Mixed Use Land Mixed Use land can be developed to meet the City's residential and employment needs—sometimes within the same structure. It includes land within the WLG RMU, CI, CR&D, EC, FMU, GC, HC, NC, OC, and WLG OC Comprehensive Plan designations unless it meets the criteria for"Publicly Owned/Other" land. More information about the assumptions for future housing development in these areas is found later in this report. Nonresidential Land Nonresidential land includes employment land and "Publicly Owned/Other" land, as follows.This land is not included in the inventory. PP 22-0005 ATTACHMENT 5/PAGE 7 OF 18 Employment Land Employment Land is intended to meet the City's employment needs. It includes land within the MC and IP Comprehensive Plan designations unless it meets the criteria for "Public/Other" land. Publicly Owned/Other This category of land includes the SP, PF, and PNA designations, as well as land in the following categories: • Land in another Comprehensive Plan designation under City, County, State, Federal, or Special District Ownership • Land commonly held in Homeowners'Associations (HOA) common ownership, such as required open space. • Religious or fraternal properties (with the notable exception of Marylhurst University,which is accounted for in a separate line item). • Private driveways and ROW Parcels in this category may be included in other classifications if information is available to suggest that they have development capacity for residential or employment uses. PP 22-0005 ATTACHMENT 5/PAGE 8 OF 18 Figure 4.BLI Land Classification I ��� i ®Study Area ::+ 7 i ‘;r1„41, ;J'l11 UM O t = Lake Oswego City "o.. i• .- Z161;i, i. r - - - Limits i ,.. ,ii+ric- .,. ;; ,;; �� i Land Type 10 `j1‘---4 try .: i 1 \ ;Il'�,�,ll :jyel� 'p� �'�!` �Z �._-; 1�� i Residential �L••`I�fif! ,'P�r I-P1 ,lE L�0 2i ■ mil �" i17 ` � Mixed Use �' -�� >�`'°Aty,,,='��._11 �►-� 1,416.4* I�� Public/Other 1� 'j-•4'y !� II V ,... q�L�� �'`_ ' , Non-Residential y-; c E % r y�hll� uil i llllll r. mo j.,IIIr • 0 2 18116F,5„...4IWb.ad-ll migeP;ftleiikoiiirA l ...,„.g.s.-,,pV-,....i..).a....11.l-..i,--.1--,4.1.—1-,..01r14ro1arb1,-s._,i*m,.--..,,,,,,,a:.-. I , dd I'1i OiI.r.&lli.r"r....r.d07.,1V 1.-..,*-.41E%ma. 10r.1I ' ttl.:— r ■ A. ems,✓� +r ; 4 44:I I I 110W. t1)1 Se 4-41.:b 4k• IMI-01.47-1701:11- I._-•-r -till Ai ri#112,41,2=6:11eitei*:412L111,iill or. '%. 1• it,eAt IP, WAN= MM. ,.. .1,....iii-... , ,‘ Walli :417 p041 pieNi Ali -art ‘ c„,:fli.1 ert 4•44,411L 44 'AO . (6,„ , i'' „4011$ 1...\-1, !,,,-,,, 1,2_, — r i likAfet% , -11 3' ,...,=, s 11111,Tat _.:-.-,t.i.Ad, ii Vali i ,, i , 0%04, ,....* w wgrow ice=i 1� �ik v o: II Miles- - \ „RE, 0 1 0.25 0.5 1 Lake Oswego Buildable Lands Inventory I Land Type Prepared by 1313 0 PP 22-0005 ATTACHMENT 5/PAGE 9 OF 18 Step 2: Constraints to Development One of the primary tasks of this BLI is to identify land that is constrained by one or more of the following physical constraints. Constraints may overlap one another spatially—in this case the more restrictive constraint applies.Assumptions for these constraints are listed below—they have been discussed with City staff but are subject to further refinement, as needed. Constraints are described in Table 2 and shown on Figure 5. Table 2. Development Constraints Constraint Description Developable Portion Steep Slopes Slopes greater than 25%. Density transfer resulting in 5% Developable the construction of 1-2 dwelling units allowed. Water Bodies Includes lakes, streams, other areas of open water 0% Developable FEMA Flood Includes Zones A,AE, and X. Density transfer resulting 5% Developable Hazard Areas in the construction of 1-2 dwelling units allowed. Greenway Protects land along the Willamette River. Permitted Management uses include single-family dwellings and accessory 25% Developable Overlay District structures associated with such dwellings. Includes Resource Protection (Streams and Wetlands; RP), Resource Conservation (Tree Groves; RC), and Habitat Benefit Areas (Tree Groves; HBA). RP and RC areas are tightly regulated, while HBAs are areas with optional resource protection incentives rather than regulations. RP—50% Developable Sensitive Lands RP—Density transfer possible. RC—0% Developable RC- Mostly applies to public land and open space HBA—95% tracts, which are not developable (PF and PNA zones, Developable OS tracts in private developments,typically). HBA- Incentives, rather than regulations, are applied to protect natural resources. Usually does not limit development beyond a modest reduction. PP 22-0005 ATTACHMENT 5/PAGE 10 OF 18 Figure 5. Constraints to Development k )Study Area SW STEPHENSON ST `_9 Ro Lake Oswego City ¶ q y M S aP wY ER - N Limits �SFR o =j K �o° S L o Major Roads 5� o_ _- Taxlots °1 j J.Sf ) _ Greenway Mgmt. h �', Overlay District MELROSE ST -Sri— ,.... o Slopes>25% i o COOiER,i- o0 7�Eo FEMA Floodplain �2F y 4 Sensitive Lands Overlay �/ Q Habitat Benefit Areas ���� KNUSE_WAY 0,,2�J,�q"` S- A AVE it- ME oJ�Q. o,.: z (HBA) SW BhONITA RDu �'EA.,P5> p, mo z o�"ouNrA/>Brvo Resource - i FI o �W Conservation Areas o i", es R 4 Resource Protection 1 [1 oR �E`N gw v PJ b, 1 j oQeEP`P EJ SHORE ew Areas(RP) 1 0 I� t. ' SO� h 0 0<()9 `J YYYYLLLL����FF�F p GREENTHEEP e �o� LFRN �� I ' `^ P�OOK� s BERGIS:RD _ 0 "`iii 1 '� 3 OAF 9 C. y 0 Ni,'i , r °GEwAY o _ SS ��- G' mot,'¢ z 0 �� cHILDSRom 3 vosRbya� 1 AgrF�� oii » t/s (0 9 Li 1 ' l -t :Z 1Miles a _ _ � 'i T___ y 0 0.25 05 Y IN.Pri,Lake Oswego Buildable Lands Inventory I Environmental Constraints Prepared by ® 0 Q The BLI includes the following information for each tax lot in the study area based on the location of constraints. • Acres—Total size of the tax lot • Constrained Acres—Acreage of constrained areas, per Table 2 • Unconstrained Acres—Total acres minus Constrained Acres The following table shows gross acres of land in each primary land classification in the Study Area. Table 2. Constrained and Unconstrained Acres by Land Type Land Type Total Acres Constrained Acres Unconstrained Acres Residential 5,889.2 1,307.0 4,582.2 Mixed Use 615.2 120.2 495.0 Non-Residential 212.2 8.4 203.8 Publicly Owned/Other 1,699.0 906.2 792.8 Total 8,415.6 2,341.5 6,090.4 PP 22-0005 ATTACHMENT 5/PAGE 11 OF 18 Step 3: Development Status Each tax lot in the study area is categorized as Vacant, Partially Vacant, or Developed.The following data is used to determine development capacity of Study Area tax lots: • Assessor data, including Property Land Use Code, Improvement Value, and Land Value • City inventory of outdoor areas, used in identifying public and commonly-held open spaces such as public facilities, parks and Homeowners Association-owned open spaces. • Metro Vacant Land Inventory derived annually from aerial photo information. • Review of recent aerial imagery • Discussion and review with City staff and Housing Task Force Generally,vacant tax lots are assumed to have development capacity equal to the area unconstrained by natural resources, minus additional set-asides for future Right-of-Way and infrastructure (see Step 4). Developed parcels will be subject to further screening for redevelopment potential, described in later steps. Partially Vacant properties have an existing home but are large enough to subdivide based on criteria such as parcel size and allowable lot size, as described in this section. Residential Development Status • Vacant. Land that has a building improvement value of less than $20,000, as indicated by assessor data.All land outside of constrained areas is included in the developable area for these properties. • Vacant—Platted.Vacant land that is part of a platted but unbuilt subdivision is included in this category. Platted lots are assumed to contain one unit each unless other information is available (see Step 4). "Developable Acres" is shown as "0" because they are treated separately from other acreage in the inventory. • Partially Vacant.This designation is intended for parcels with an existing single-detached home that are large enough to further subdivide or develop to provide additional residential units. While middle housing and townhomes are allowed in many zones, this analysis uses the minimum lot size required for single-detached dwellings as the basis for the Partially Vacant designation, as follows: o Parcels greater than 5 times the minimum lot size:These lots are categorized as "Partially Vacant." 1/4 acre is assumed to remain for the existing home and the remaining unconstrained acreage is assumed to be developable. o Parcels between 2 and 5 times the minimum lot size: For lots with building value below $200,000-%acre is assumed to remain for the existing home and the remaining unconstrained acreage is assumed to be developable. o Parcels less than 2 times the minimum lot size: These lots are categorized as "Developed" if improvement value is present or aerial photo review shows development. • Developed. All other residential land is designated Developed and has no developable area. PP 22-0005 ATTACHMENT 5/PAGE 12 OF 18 Mixed Use Development Status Mixed Use development is subject to the same criteria as Residential Land. However, an additional screen is used to determine the likelihood of redevelopment of mixed-use parcels in Step 4, and assumptions about the residential/employment mix (see Table 3) are applied. Mixed Use Residential Proportion Mixed use designations are assumed to develop partly with residential uses and partly with non- residential uses, per the following table. Table 3. Residential Portions of Mixed Use Tax Lots Mixed Use Residential Nonresidential Notes Designation Portion Portion West Lake Grove 50% 50% Townhomes only allowed with office use in the Residential Mixed Use same building (WLG RMU) West Lake Grove 25% 75% Residential limited to Boones Ferry Staging site, Office-Commercial per LOC 50.03.003.2.d. Residential limited to (WLG OC) Boones Ferry Staging Site... Percentage based on the size of this site in relation to the total size of district(see LOC 50.03.003.2.d for geography). Campus Institutional 50% 50% Multifamily development is limited to Subarea I (CI) of the Marylhurst Campus. Marylhurst Campus zone—probably needs a special look at any vacant area. Refine based on analysis of Marylhurst campus...ask DR planner? Campus Research& 30% 70% Assumption based on trends in this area Development(CR&D) East End Commercial 80% 20% (EC) Foothills Mixed Use 80% 20% Most similar to EC in terms of res/non-res mix (FMU) General Commercial 30% 70% (GC) Highway Commercial 10% 90% (HC) Neighborhood 50% 50% Commercial (NC) Office Campus(OC) 30% 70% Summary The following table lists the number of tax lots,total and constrained acreage, and developable area by land type.A map summarizing development status is shown in Figure 6. PP 22-0005 ATTACHMENT 5/PAGE 13 OF 18 Table 4. Developable Area of Residential and Mixed Use Tax Lots Gross Constrained Unconstrained Developable Land Type Acres Area (Acres) Area (Acres) Acres Residential 4,413 951 3,547 345 MixedUse 493 96 399 15 Non-Residential 181 21 160 - Public/Other 3,491 1,309 2,215 - Total 8,578 2,377 6,320 360 Figure 6. Development Status of Residential and Mixed Use Land `Nv t f' . s !.L pf' ,_9iL 'q� ,/ y�',} f Development Status i, a Developed _ a P �5�, I ,-,:it A Partially Vacant •►/ J� ':A,Nt p ) 1 Vacant • T. \ ‘ ...MELROSE ST ITill - ! I N � , y . i� I ._ , \'.1i ....ler il �9�` 60U Tqih. r� / .....„.. ....._ ,,.ti k. I; Yf '- - - jKRU�E WAY. it _�• 4- _, :• ol.&- Ain,°„. rF 1 1 _ MEADOWS RD S- Y oe, .a _ _ 1 . OUNTA/N ��•- 2 ' �//SW'BONITA RD•"— CAP 9. --0. F �Ch BLV,D: � -'TYw \ D IR APO / '.P 1 'a o + 3 Jul o F.Q'�R\E�.gIVD. I' :' 4',_ v, R 'al 1 - 1 L f•% 50�.• a y • Q% b J °H/ i s! 'II' a GREENTREE RD 1' _ / 0S' .FRS 0 ) . , , _, .. . / '^elf EOOK. _ S BERGIS.RD F' a ..1•1 ► oft. ... 31, / _/^` 4'�FI•�_'1 ' m .1`I�ry_� :��E�S RDyy�\$ s'F2jO 1 A. yo 't�.-� Itt""111_ CHILDS RD l c, tiT . ti R' — is AT_'0 0.25_ 0.5 1- - � :, J, r �i 0 _-- ,y,a Lake Oswego Buildable Lands Inventory I Development Status Prepared by IM 0 0 PP 22-0005 ATTACHMENT 5/PAGE 14 OF 18 Step 4: Net Buildable Area and Unit Capacity This step of the BLI establishes the net buildable area of residential land in the Study Area by removing land needed for future right-of-way and other infrastructure set-asides, and by subtracting the non- residential portions of mixed-use zones.This step also accounts for platted subdivisions and other development with known approvals. Right of Way and Other Set-Asides When vacant land develops, land for roads, infrastructure, open space, and other needs reduce the gross available acres into a net developable acreage.The BLI uses the following assumptions to calculate net developable acreage for each parcel. • Residential Land: 20%of vacant properties, 0%of partially vacant properties • Mixed Use Land: 20%of vacant properties, 0%of partially vacant properties Assumed Density Table 7 shows the assumed density for various zoning designations in the City of Lake Oswego.This information is based on the minimum lot sizes, likely densities, and staff assumptions based on recent projects and comparable zones, and parcel-by-parcel analysis. Table 4. Unit Capacity on Residential and Mixed Use Land Zoning Density Notes Assumption for BLI Designation Residential-Low Density Zones R-15 Min 15,000 sf lot area. 2.9 2.9 DU/AC net (could increase DU/AC net slightly to assume some middle housing) R-10 Min 10,000 sf lot area. 4.3 4.3 du/ac net. (could increase du/ac net. slightly to assume some middle housing) R-7.5 Min 7,500 sf lot area 5.8 du/ac 5.8 du/ac net (could increase net slightly to assume some middle housing) Residential-Medium Density Zones R-5 7-8 units per gross acre, per —8 du/ac code. 5,000 sf min lot size for single- family. 1,500 for townhouse. R-DD Buffer zone. 21 du/ac —8 du/ac theoretically possible. R-6 First Addition Neighborhood —7 du/ac (FAN) zone 6,000 sf lot area for Single- Family. 1,500 for townhouse. Residential-High Density Zones PP 22-0005 ATTACHMENT 5/PAGE 15 OF 18 Zoning Density Notes Assumption for BLI Designation R-3 At least 12 du/ac. (3,375 min —12 du/ac per dwelling, or 12.9 du/ac). Townhomes up to 29 du/ac R-2 Min 12 du/ac 12 du/ac R-0 Min 20 du/ac 20 du/ac R-W —12 du/ac Mixed Use Zones West Lake Grove Table 50.03.002-2 notes "R-5 —5 du/ac Residential Mixed density or greater" Use(WLG RMU) West Lake Grove Table 50.03.002-2 notes "R-5 35 du/ac expected in BFR Office-Commercial density or greater" Staging Site, nothing in other (WLG OC) areas Campus Table 50.03.002-2 notes "R-5 Generally applies to Merylhears Institutional (CI) density or greater". Must have University, which is treated commercial on ground floor. separately. Campus Research& 54 du/ac for projects that Development Table 50.03.002-2 notes "R-5 include residential (-30%of the (CR&D) density or greater" district, as above) based on LU 19-0041 East End Table 50.03.002-2 notes "R-5 ^'56 du/ac Commercial(EC) density or greater". Must have commercial on ground floor. Foothills Mixed Use Table 50.03.002-2 notes "R-5 ^'56 du/ac (FMU) density or greater" General Table 50.03.002-2 notes "R-5 ^'27 du/ac based on Mercantile Commercial(GC) density or greater". Must have project(LU 18-0026) commercial on ground floor. Residential not allowed "In the GC-zoned area in the vicinity of Jean Way and Boones Ferry Road" Highway Table 50.03.002-2 notes "R-5 8 du/ac (or R-5 density) for the Commercial(HC) density or greater" 10%that may develop as residential Neighborhood Table 50.03.002-2 notes "R-5 67 du/ac for the 50%that may Commercial (NC) density or greater". Must have develop as residential (based on commercial on ground floor. LU 07-0031) Office Campus(OC) Table 50.03.002-2 notes "R-5 21 du/ac for the 50%that may density or greater" develop as residential (based on Galewood Commons Apartments) PP 22-0005 ATTACHMENT 5/PAGE 16 OF 18 Summary Table 4 describes the net residential developable acres in Mixed Use zones, accounting for employment uses on mixed-use land and assumed right-of-way.Table 5 summarizes net residential acreage for both residential and mixed-use land in the study area. Table 5. Net Developable Acres of Residential and Mixed Use Land Gross Constrained Unconstrained Developable Unit Capacity Land Type Acres Area (Acres) Area (Acres) Acres Residential 4,413 951 3,547 345 1,218 MixedUse 493 96 399 15 178 Non-Residential 181 21 160 - - Public/Other 3,491 1,309 2,215 - - Total 8,578 2,377 6,320 360 1,396 Figure 7. Unit Capacity by Zoning Designation Land Type Unit Capacity Residential 1,218 EC/R-0 5 R-0 2 R-10 215 R-10 Comp Plan 468 R-15 114 R-3 22 R-5 104 R-7.5 136 R-7.5 Comp Plan 133 R-DD 10 R-W 1 WLG-R 2.5 8 Mixed Use 178 CR&D 39 EC 67 GC 12 NC 23 NC/R-0 9 OC/R-3 5 R-0 8 R-3 5 WLG-OC 7 WLG-R RMU 3 Grand Total 1,396 PP 22-0005 ATTACHMENT 5/PAGE 17 OF 18 Additional Capacity: • Remaining Marylhurst University approval: 70 units • Additional Middle Housing Capacity(estimated at 3% of developed lots with single-detached dwellings): 410 Units • Redevelopment on Multifamily and Mixed Use Land:TBD. Further analysis will include a look at "strike price" (current value per square foot), age of structure, and recent trends related to converting office uses to residential uses. Total Unit Capacity: 1,876 Units. Mix (e.g. single detached, middle housing, multi-dwelling)TBD. Next Steps The contents of this inventory will be reviewed by City staff,the Housing Task Force, and other stakeholders. Further analysis into potential redevelopment,the characterization of"partially vacant" land, densities, housing mix, and other attributes of the BLI are expected. This inventory will inform the Housing Capacity Analysis and Housing Needs Assessment to provide a picture of the availability of residential land as it compares to the need of certain types of housing units in the next 20 years. PP 22-0005 ATTACHMENT 5/PAGE 18 OF 18 ATTACHMENT 6 DRAFT :4 • - 41% k .,,, - _..____.,,, miii`(1 !1 I- - -..-. 1. `-: -_ - - _-< i I I ! .ice ,1 ''I - 1lflulRiiiii1 ;. Source:Lake Oswego Chamber of Commerce CITY OF LAKE OSWEGO, OR HOUSING CAPACITY ANALYSIS (OREGON STATEWIDE PLANNING GOAL 10) 20-YEAR HOUSING NEED 2023 - 2043 March 2023 \4.■ 1 = JOH NSON ECONOMICS PP 22-0005 ATTACHMENT 5/PAGE 1 OF 29 Acknowledgments Johnson Economics prepared this report for the City of Lake Oswego.Johnson Economics and the City of Lake Oswego thank the many people who helped to develop this document. City Staff Erik Olson, Long Range Planning Manager Jessica Numanoglu, Interim Community Development Director Advisory Committees Consultants Johnson Economics MIG This report was prepared in accordance with the requirements of OAR 660 Division 8:Interpretation of Goal 10 Housing. This project is funded by the State of Oregon through the Department of Land Conservation and Development. The contents of this document do not necessarily reflect the views or policies of the State of Oregon. City of Lake Oswego Johnson Economics 380 A Ave. 621 SW Alder Street Lake Oswego, OR 97034 Suite 605 (503) 635-0270 Portland, OR 97205 (503) 295-7832 CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 1 PP 22-0005 ATTACHMENT 5/PAGE 2 OF 29 TABLE OF CONTENTS I. INTRODUCTION 3 II. CITY OF LAKE OSWEGO DEMOGRAPHIC PROFILE 4 A. POPULATION GROWTH 5 B. HOUSEHOLD GROWTH&SIZE 5 C. FAMILY HOUSEHOLDS 5 D. GROUP QUARTERS POPULATION 6 E. HOUSING UNITS 6 F. AGE TRENDS 6 G. INCOME TRENDS 8 H. POVERTY STATISTICS 9 I. EMPLOYMENT LOCATION TRENDS 9 III. CURRENT HOUSING CONDITIONS 11 A. HOUSING TENURE 11 B. HOUSING STOCK 11 C. NUMBER OF BEDROOMS 11 D. UNIT TYPES BY TENURE 12 E. AGE AND CONDITION OF HOUSING STOCK 13 F. HOUSING COSTS VS. LOCAL INCOMES 14 G. PUBLICLY ASSISTED HOUSING 15 IV. CURRENT HOUSING NEEDS(CITY OF LAKE OSWEGO) 17 V. FUTURE HOUSING NEEDS-2043(CITY OF LAKE OSWEGO) 23 CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 2 PP 22-0005 ATTACHMENT 5/PAGE 3 OF 29 I. INTRODUCTION This analysis outlines a forecast of housing need within the City of Lake Oswego. Housing need and resulting land need are forecast to 2043 consistent with the 20-year need assessment requirements of Oregon Revised Statutes.' This report presents a housing need analysis (presented in number and types of housing units) and a residential land need analysis, based on those projections. The primary data sources used in generating this forecast were: ■ Portland State University Population Research Center ■ Metro ■ U.S.Census ■ Claritas2 ■ Oregon Employment Department ■ City of Lake Oswego ■ Clackamas County ■ Other sources are identified as appropriate. This analysis relies heavily on Census data from both the 2020 Decennial Census and the American Community Survey (ACS).All Census data feature some margin of error but remain the best source of data available on many demographic and housing subjects. One limitation of the 2020 Census is the release schedule of data sets,which takes place over several years following the year of the Census. Thus far, data has been released on: Population; Race; Latino ethnicity; number of Households; number of Housing Units; and Group Quarters population. While these are key baseline data sets utilized in this analysis, any additional nuance on demographics and housing from the 2020 Census are not yet available,with the next data release expected later in 2023. Despite the limitations,the 2020 Census is relied upon here as the best available source for the key indicators listed above in Lake Oswego,as of 2023. For more detailed data sets on demographics and housing,this analysis relies on the American Community Survey (ACS), which features a higher margin of error on all tables than the Decennial Census. The ACS is a survey of a representative sample of households which the Census uses to make estimates generalized to the population of the relevant geography.This analysis relies whenever possible on the most recent 2021 ACS 5-year estimates.The 5-year estimates have a lower margin of error than the ACS 1-year estimates. 'ORS 197.628;OAR 660-025 Claritas is a third-party company providing data on demographics and market segmentation. It licenses data from the Nielson Company which conducts direct market research including surveying of households across the nation. Nielson combines proprietary data with data from the U.S.Census,Postal Service,and other federal sources,as well as local-level sources such as Equifax,Vallassis and the National Association of Realtors. Projections of future growth by demographic segments are based on the continuation of long-term and emergent demographic trends identified through the above sources. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 3 PP 22-0005 ATTACHMENT 5/PAGE 4 OF 29 II. CITY OF LAKE OSWEGO DEMOGRAPHIC PROFILE SUMMARY The following table (Figure 2.1) presents a profile of City of Lake Oswego demographics from the 2000 and 2010 Census. It also reflects the estimated population of this area as of 2023 from PSU estimates,forecasted forward to 2023 using the estimated growth rate between 2010 and 2022. ■ Lake Oswego is a City of over 41,500 people located in Clackamas County in the southern-central area of the Portland metropolitan region. ■ Based on estimated population, Lake Oswego is the 13th largest city in the state by population, similar in size to Oregon City regionally,or Keizer and Grants Pass statewide.Lake Oswego has about 1.5 times the population of neighboring West Linn or Tualatin, and about 75%of the population of Tigard. ■ Lake Oswego has experienced modest growth, growing roughly 18% since 2000, or less than 1% per year. In contrast, Clackamas County and the state experienced population growth of 26% and 25% respectively. (US Census and PSU Population Research Center) FIGURE 2.1:LAKE OSWEGO DEMOGRAPHIC PROFILE POPULATION, HOUSEHOLDS, FAMILIES, AND YEAR-ROUND HOUSING UNITS 2000 2010 Growth 2023 Growth (Census) (Census) 00-10 (PSU) 10-23 Population) 35,278 36,619 4% 41,550 13% Households2 14,824 15,893 7% 17,481 10% Families3 9,775 10,079 3% 11,842 17% Housing Units4 15,668 16,995 8% 18,345 8% Group Quarters Populations 163 222 36% 329 48% Household Size(non-group) 2.37 2.29 -3% 2.36 3% Avg.Family Size 2.93 2.88 -2% 2.97 3% PER CAPITA AND MEDIAN HOUSEHOLD INCOME 2000 2010 Growth 2023 Growth (Census) (Census) 00-10 (Proj.) 10-23 Per Capita ($) $42,166 $53,652 27% $74,600 39% Median HH ($) $71,597 $84,186 18% $123,300 46% SOURCE:Census,Metro Consolidated Forecast,PSU Population Research Center,and Johnson Economics Census Tables: DP-1(2000,2010);DP-3(2000);S1901;S19301 1 From Census,PSU Population Research Center,growth rate 2010-2022 extended to 2023 2 2023 Households=(2023 population-Group Quarters Population)/2023 HH Size 3 Ratio of 2023 Families to total HH is based on 2021 ACS 5-year Estimates 4 2023 housing units are the'20 Census total plus new units permitted from'20 through'22(source: Census,City) 5 2023 Group Quarters Population based on 5-year ACS estimates 2017-2021 ■ Lake Oswego was home to an estimated 17,500 households in 2023, an increase of over 2,650 households since 2000. The percentage of families has increased slightly from 66% of all households in 2000 to 68% in 2023. The city has a similar share of family households to Clackamas County (69%) but higher than the state (63%).Average household size is estimated to have remained fairly stable during this period. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 4 PP 22-0005 ATTACHMENT 5/PAGE 5 OF 29 • Lake Oswego's estimated average household size is 2.4 persons. This is lower than the Clackamas County average of 2.6 and similar to the statewide average of 2.44. A. POPULATION GROWTH Since 2000, Lake Oswego has grown by nearly 6,300 people within the UGB, or 18% in 23 years. This was lower than the countywide rate of growth. Clackamas County as a whole has grown an estimated 26%since 2000,while other cities in the county such as West Linn and Oregon City grew by 23% and 46% respectively. Portland's population grew by an estimated 19%during this period (PSU Population Research Center). B. HOUSEHOLD GROWTH&SIZE As of 2023,the city has an estimated 17,500 households. Since 2000, Lake Oswego has added an estimated 2,650 households.This is an average of roughly 115 households annually during this period.The growth since 2000 has paced the growth in new housing units,which have been permitted at the rate of roughly 117 units per year. There has been a general trend in Oregon and nationwide towards declining household size as birth rates have fallen, more people have chosen to live alone, and the Baby Boomers have become "empty nesters." While this trend of diminishing household size is expected to continue nationwide,there are limits to how far the average can fall. Lake Oswego's average household size of 2.4 people,with 68%family households,is smaller than Clackamas County (2.6 persons;69%families). Figure 2.2 shows the share of households by the number of people for renter and owner households in 2021(latest data available),according to the Census. Renter households are more likely to be one-person households,with 75% having two or fewer residents. Owner households are more likely to have two or more persons. FIGURE 2.2:NUMBER OF PEOPLE PER HOUSEHOLD,CITY OF LAKE OSWEGO 0 7-or-more 0' Renter 6-person 1% Owner 2% 5-person 3% 4% in 2° 4-person 11% 18% 0 = 3-person 11/ 19% 2-person 35% 38° 1-person 40% 20% 0% 5% 10% 15% 20% 25% 30% 35% 40% Share of Households SOURCE: US Census,JOHNSON ECONOMICS LLC Census Tables: B25009(2021 ACS 5-yr Estimates) C. FAMILY HOUSEHOLDS As of the 2021 ACS,68%of Lake Oswego households were family households,up from 63.4%of households in 2010. The total number of family households in Lake Oswego is estimated to have grown by over 2,060 since 2000.The Census defines family households as two or more persons, related by marriage, birth or adoption and living together. In 2023,family households in Lake Oswego have an estimated average size of 2.97 people. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 5 PP 22-0005 ATTACHMENT 5/PAGE 6 OF 29 D. GROUP QUARTERS POPULATION As of the 2020 Census,the City of Lake Oswego had an estimated group quarters population of 0.8% of the total population, or 329 persons. Group quarters include such shared housing situations as nursing homes, prisons, dorms, group residences, military housing, or shelters. For the purposes of this analysis, these residents are removed from the estimated population total, before determining the number of other types of housing that are needed for non-group households. In Lake Oswego,nearly 90%of the group quarters population is found in assisted living facilities. E. HOUSING UNITS Data from the City of Lake Oswego and the US Census indicate that the city added roughly 2,680 new housing units since 2000, representing 17% growth in the housing stock. This number of new units is slightly higher than the growth in new households estimated during the same period (2,660), indicating that housing growth has kept pace with growing need. As of 2023, the city had an estimated housing stock of roughly 18,350 units for its 17,500 estimated households. This translates to an estimated average vacancy rate of 4.7%. Residential Permits: An average of 117 units have been permitted annually since 2000, with 24% being multi- family units. Most multi-family housing in Lake Oswego has been built in the last decade. FIGURE 2.3:HISTORIC AND PROJECTED RESIDENTIAL PERMITS,CITY OF LAKE OSWEGO Housing Permits •Multi Family 350 •Single Family 300 250 200 150 1050 0 iii . II III ' ' 111 00 `l � 0 09' y0 yL y0 ti 'b ,LO ,LO ,ti0 ,y0 ,LO ,LO ,y0 ,ti0 ,LO• ,ti0 ,y0 ,LO SOURCE:HUD F. AGE TRENDS The following figure shows the share of the population falling in different age cohorts between the 2000 Census and the most recent 5-year American Community Survey estimates. As the chart shows,there is a general trend for middle age and young cohorts to fall as share of total population, while older cohorts have grown in share.This is in keeping with the national trend caused by the aging of the Baby Boom generation. Overall, Lake Oswego has an older population than the county,with a similar share of children, but a smaller share of those aged 25 to 44 years. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 6 PP 22-0005 ATTACHMENT 5/PAGE 7 OF 29 FIGURE 2.4: AGE COHORT TRENDS,2000-2021 25% Lake Oswego(2000) o N Lake Oswego(2021) 20% N o 0 coti o Clack.Co.(2021) 15% ti M a e o N d o N N o e-I o e-I e-I o r1 O o .--I O `"1 r1 O .--i c 1-1 10% O1 0 0 0 o Lf1 ul ip e 5% o N N 0% yh�eat5 ���aie ���eat5 ����at5 ���eat5 ����aie �1), Ott., A6`fix a aec �o �o �o �o co ,�0 ,`0 co J° N, .1, 0, o, 4h cod AG) SOURCE: US Census,JOHNSON ECONOMICS LLC Census Tables: QT-P1(2000);S0101(2021 ACS 5-yr Estimates) • The cohorts which grew the most in share during this period were those aged 55 to 74 years.Still,an estimated 79%of the population is under 65 years of age. • In the 2021 ACS, the local median age was an estimated 46 years, compared to 40 years in Oregon, and 39 years nationally. Figure 2.5 presents the share of households with children, and the share of population over 65 years for comparison. Compared to state and national averages, Lake Oswego has a similar share of households with children. However,at 21%,the share of population over 65 is higher than the state and national figures. FIGURE 2.5: SHARE OF HOUSEHOLDS WITH CHILDREN POPULATION OVER 65 YEARS(LAKE OSWEGO) Share of Households with Children Share of Population Over 65 Years 40% 40% 31% 31% 30% 28% 30% 21% 20% 20% 18% o 16% 10% 10% 0% 0% Lake Oswego Oregon USA Lake Oswego Oregon USA SOURCE: US Census,JOHNSON ECONOMICS LLC Census Tables: B11005;S0101(2021 ACS 5-yr Estimates) CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 7 PP 22-0005 ATTACHMENT 5/PAGE 8 OF 29 G. INCOME TRENDS The following figure presents data on Lake Oswego's income trends. FIGURE 2.6: INCOME TRENDS,2000—2023(LAKE OSWEGO) PER CAPITA AND MEDIAN HOUSEHOLD INCOME 2000 2010 Growth 2023 Growth (Census) (Census) 00-10 (Proj.) 10-23 Per Capita ($) $42,166 $53,652 27% $74,600 39% Median HH ($) $71,597 $84,186 18% $123,300 46% SOURCE:Census,Metro Consolidated Forecast,PSU Population Research Center,and Johnson Economics Census Tables: DP-1(2000,2010);DP-3(2000);S1901;S19301 • Lake Oswego's estimated median household income was$123,000 in 2023.This is nearly 40%higher than the Clackamas County median of$88,500, and 75%higher than the statewide median of$70,000. • Lake Oswego's per capita income is roughly$75,000. • Median income has grown an estimated 46% between 2010 and 2023, in real dollars. Inflation was an estimated 34%over this period,so the local median income has well exceeded inflation.This is not the case in many regions and nationally,where income growth has not kept pace with inflation. Figure 2.7 presents the estimated distribution of households by income as of 2021.The largest income cohorts are those households earning between $100k and $200k per year(32%), followed by households earning over$200k (27%). • 41%of households earn less than $100,000. • Roughly 19%of households earn less than$50k per year. FIGURE 2.7: HOUSEHOLD INCOME COHORTS,2021(LAKE OSWEGO) Household Income Groups $200,000 or more 27% $150,000 to$199,999 12% $100,000 to$149,999 20% $75,000 to $99,999 11% $50,000 to $74,999 11% $35,000 to $49,999 6% $25,000 to $34,999 4% $15,000 to $24,999 4% $10,000 to $14,999 2% Less than $10,000 3% 0% 5% 10% 15% 20% 25% 30% SOURCE: US Census,Census Tables: S1901(2021 ACS 5-yr Est.) CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 8 PP 22-0005 ATTACHMENT 5/PAGE 9 OF 29 H. POVERTY STATISTICS According to the US Census,the official poverty rate in Lake Oswego is an estimated 4%over the most recent period reported (2021 5-year estimates).3 This is roughly 1,700 individuals in Lake Oswego. In comparison, the official poverty rate in Clackamas County is 9%,and at the state level is 17%. In the 2017-21 period: ■ The Lake Oswego poverty rate is low among all groups,but highest among those 65 years and older at 5%.The rate is 4%among those 18 to 64 years of age.The estimated rate is lowest for children at 3%. ■ For those without a high school diploma,the poverty rate is 11%. ■ Among those who are employed the poverty rate is 2%,while it is 7%for those who are unemployed. Information on affordable housing is presented in Section II F of this report. FIGURE 2.8: POVERTY STATUS BY CATEGORY(LAKE OSWEGO) Poverty Level of Subgroups Under 18 years 3% 18 to 64 years 4% 65 years and over 5% Employed 2% Unemployed 7% Less than high school 11% High school 10% Some college, associate's 7% Bachelor's degree or higher 3% 0% 5% 10% 15% 20% SOURCE: US Census Census Tables: S1701(2021 ACS 5-yr Est.) I. EMPLOYMENT LOCATION TRENDS This section provides an overview of employment and industry trends in Lake Oswego that are related to housing. Commuting Patterns: The following figure shows the inflow and outflow of commuters to Lake Oswego according to the Census Employment Dynamics Database.These figures reflect"covered employment" as of 2019,the most recent year available. Covered employment refers to those jobs where the employee is covered by federal unemployment insurance. This category does not include many contract employees and self-employed and therefore is not a complete picture of local employment.The figure discussed here is best understood as indicators of the general pattern of commuting and not exact figures. 3 Census Tables: S1701(2018 ACS 5-yr Estimates) The Census Bureau uses a set of income thresholds that vary by family size and composition to determine who is in poverty.There are 48 separate income thresholds set based on the possible combinations of household composition. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 9 PP 22-0005 ATTACHMENT 5/PAGE 10 OF 29 As of 2017,the most recent year available,the Census estimated there were roughly 23,100 covered employment jobs located in Lake Oswego. Of these,an estimated 2,250 or 10%,are held by local residents,while nearly 21,000 employees commute into the city from elsewhere.This general pattern is fairly common among many communities in the Metro area, but the pattern is particularly stark here.The most common homes of local workers commuting into the city are Portland, Beaverton,or Tigard. This data set predates the surge in remote working that has taken place over the last few years. In prior years, it was safe to assume that most residents holding jobs outside the community likely commuted physically. Now a resident might hold a job in another city but work from home. Unfortunately, these data do not quantify this growing segment. Similarly, of the estimated 18,000 employed Lake Oswego residents, 88% of them commute elsewhere to their employment. The most common destinations for Lake Oswego commuters are Portland and Beaverton. Smaller shares work elsewhere in the Portland metro or in the mid-Willamette Valley. FIGURE 2.9: COMMUTING PATTERNS(PRIMARY JOBS),LAKE OSWEGO Metzger ��• Milwaukie Hosp 0 Li von Creek State© a3 Mllwaukle ® M Natural Area , Duntho lit_' • - 'r1 '4 99 E jard � • Oswego 20,900 2,250 15,800 Work in Lake Oswego, Live and work Live in Lake Oswego, live elsewhere in Lake Oswego work elsewhere 17- :ryant n's 1-4-- -\____) , :. Landing Durham ,�1 ""1 _ . ' ritage Center 90% / 10% 12% 88% Jennii Lr 1 MARYLHI'F—I River Grove.` i Stafford • ualatn © Leg,dcy Meridian Source: US Census Longitudinal Employer-Household Dynamics Jobs/Household Ratio: Lake Oswego features a balanced jobs-to-households ratio.There are an estimated 23,000 jobs in Lake Oswego (covered), and an estimated 17,500 households in Lake Oswego.This represents 1.3 jobs per household.There is no standard jobs-to-households ratio that is right for all communities,but it can provide a guide to the balance between employment uses and residential uses in the city. There is an average of 1.0 job held for each Lake Oswego household, a majority of which are located outside the city. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 10 PP 22-0005 ATTACHMENT 5/PAGE 11 OF 29 III. CURRENT HOUSING CONDITIONS This section presents a profile of the current housing stock and market indicators in Lake Oswego.This profile forms the foundation to which current and future housing needs will be compared. A. HOUSING TENURE Lake Oswego has a greater share of homeowner households than renter households.The 2021 ACS estimates that 71%of occupied units were owner occupied, and only 29% renter occupied. The ownership rate is little changed since 2000.The estimated ownership rate is higher across Clackamas County(73%)and lower statewide(63%). B. HOUSING STOCK As shown in Figure 2.1, Lake Oswego had an estimated 18,350 housing units in 2023, with a vacancy rate of 5% (includes ownership and rental units).The housing stock has increased by roughly 2,680 units since 2000,or growth of over 17%. FIGURE 3.1: ESTIMATED SHARE OF UNITS,BY PROPERTY TYPE,2023 Lake Oswego, Oregon 80% 63% 60% 40% 21% 20% 9% 6% -0% 1% 0% 0% Single Single Duplex 3-or 4-plex 5+Units Manuf. Boat,RV, Detached Attached MFR home other temp SOURCE: US Census,City of Lake Oswego Figure 3.1 shows the estimated number of units by type in 2023 based on US Census.Detached single-family homes represent an estimated 63%of housing units. Units in larger apartment complexes of 5 or more units represent 21%of units,and other types of attached homes represent 16% of units. (Attached single family generally includes townhomes, and some 2 to 4-plexes which are separately metered.) Manufactured homes represent well less than 1%of the inventory. C. NUMBER OF BEDROOMS Figure 3.2 shows the share of units for owners and renters by the number of bedrooms they have. In general, owner-occupied units are much more likely to have three or more bedrooms,while renter-occupied units are much more likely to have two or fewer bedrooms. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 11 PP 22-0005 ATTACHMENT 5/PAGE 12 OF 29 FIGURE 3.2: NUMBER OF BEDROOMS FOR OWNER AND RENTER UNITS,2021(LAKE OSWEGO) Number of Bedrooms 5 or more 1% Renter IMMI 11% Owner 4 bedrooms 5% 39% 3 bedrooms 19% 33% 2 bedrooms 43% 14% 1 bedroom 27% 2% Studio 6% 0% 0% 10% 20% 30% 40% 50% SOURCE: US Census Census Tables: B25042(2021 ACS 5-year Estimates) D. UNIT TYPES BY TENURE As Figure 3.3 and 3.4 show, a large share of owner-occupied units (81%), are detached homes,which is related to why owner-occupied units tend to have more bedrooms. Renter-occupied units are much more distributed among a range of structure types.About 18%of rented units are estimated to be detached homes or manufactured homes, while the remainder are some form of attached unit. Nearly 60%of rental units are in larger apartment complexes. FIGURE 3.3: CURRENT INVENTORY BY UNIT TYPE,FOR OWNERSHIP AND RENTAL HOUSING(LAKE OSWEGO) OWNERSHIP HOUSING OWNERSHIP HOUSING Single Single 5+Units Manuf. Boat,RV, Total Duplex 3-or 4-plex Detached Attached MFR home other temp Units Totals: 10,557 1,292 9 337 781 32 0 13,008 Percentage: 81.2% 9.9% 0.1% 2.6% 6.0% 0.2% 0.0% 100% RENTAL HOUSING RENTAL HOUSING Single Single 5+Units Manuf. Boat,RV, Total Detached Attached Duplex 3-or 4-plex MFR home other temp Units Totals: 934 332 250 675 3,145 0 0 5,337 Percentage: 17.5% 6.2% 4.7% 12.7% 58.9% 0.0% 0.0% 100% Sources: US Census,JOHNSON ECONOMICS,CITY OF LAKE OSWEGO CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 12 PP 22-0005 ATTACHMENT 5/PAGE 13 OF 29 FIGURE 3.4: CURRENT INVENTORY BY UNIT TYPE,BY SHARE Lake Oswego, Oregon 100% 81% Owner 80% Rental 59% E 60% co 40% 20% 18/ 10/0 13% 60 6% � 0% 5% 3% 0% 0% 0% 0% 0% Single Single Duplex 3-or 4-plex 5+Units Manuf. Boat, RV, Detached Attached MFR home other temp Unit Type Sources: US Census,JOHNSON ECONOMICS,CITY OF LAKE OSWEGO E. AGE AND CONDITION OF HOUSING STOCK Lake Oswego's housing stock reflects the pattern of development over time.The greatest periods of development in Lake Oswego were in the 1970's and 1980's. Roughly 15%of the housing stock has been built since 2000. FIGURE 3.5: AGE OF UNITS FOR OWNERS AND RENTERS(LAKE OSWEGO) 30% 25% Owner 25% 23% 23% Renter 20% 20% 20% 17% 15% o 10% 7% 10% U o 7% 5% 5% 5% 5% 3% 3% 1% 0% 05 �0005 c)oy ti°coy \oy (c)oy 4 05 ti°�oy y eat\\eC of Year Housing Unit Built SOURCE: US Census Census Tables: B25036(2021 ACS 5-year Estimates) • Unfortunately, good quantitative data on housing condition is generally unavailable without an intensive on- site survey of all local housing,which is beyond the scope of this analysis.Census categories related to housing condition are ill-suited for this analysis, dealing with such issues as units without indoor plumbing,which was more common in the mid-20t"Century, but is an increasingly rare situation.Age of units serves as the closest reliable proxy for condition with available data. • For ownership units, older homes may be in poor condition, but are also more likely to have undergone some repair and renovation over the years. Rental units are more likely to degrade steadily with age and wear-and- CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 13 PP 22-0005 ATTACHMENT 5/PAGE 14 OF 29 tear, and less likely to receive sufficient reinvestment to keep them in top condition, though this is not universally true. F. HOUSING COSTS VS. LOCAL INCOMES Figure 3.6 shows the share of owner and renter households who are paying more than 30% of their household income towards housing costs, by income segment. (Spending 30%or less on housing costs is a common measure of"affordability" used by HUD and others, and in the analysis presented in this report.) As one would expect, households with lower incomes tend to spend more than 30% of their income on housing, while incrementally fewer of those in higher income groups spend more than 30% of their incomes on housing costs.Of those earning less than$20,000,an estimated 91%of owner households and 100%of renters spend more than 30%of income on housing costs. Even among households earning between $50,000 and $75,000 per year, a majority are housing cost burdened. Because Lake Oswego has an income distribution skewed towards higher income levels,there are relatively few households in these lower income segments,compared to most other cities. In total,the US Census estimates that over 31%of Lake Oswego households pay more than 30%of income towards housing costs(2021 American Community Survey, B25106) FIGURE 3.6: SHARE OF LAKE OSWEGO HOUSEHOLDS SPENDING MORE THAN 30% ON HOUSING COSTS, BY INCOME GROUP 100% 100% 91% 92% 88% Owner Households o 82% 80% 74% Renter Households 64% 60% 51% U, U, 0 0 v ao 40% c z =• 20% 12%0 16% ai• 0% co Less than $20,000 to $35,000 to $50,000 to $75,000 or $20,000 $34,999 $49,999 $74,999 more Household Income Sources: US Census,JOHNSON ECONOMICS Census Table: B25106(2021 ACS 5-yr Estimates) Housing is generally one of a household's largest living costs,if not the largest.The ability to find affordable housing options, and even build wealth through ownership, is one of the biggest contributors to helping lower income households save and cultivate wealth. Even if renting, affordable housing costs allow for more household income to be put to other needs,including saving. The following figures show the percentage of household income spent towards gross rent4 for local renter households only.This more fine-grained data shows that not only are 49%of renters spending more than 30%of their income on gross rent, but an estimated 29%of renters are spending 50%or more of their income on housing and are considered severely rent-burdened. The Census defines Gross Rent as"the contract rent plus the estimated average monthly cost of utilities(electricity,gas,and water and sewer) and fuels(oil,coal,kerosene,wood,etc.)if these are paid by the renter(or paid for the renter by someone else)." Housing costs for homeowners include mortgage,property taxes,insurance,utilities and condo or HOA dues. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 14 PP 22-0005 ATTACHMENT 5/PAGE 15 OF 29 Renters are disproportionately lower income relative to homeowners. Housing cost burdens are felt more broadly for these households, and as the analysis presented in a later section shows there is a need for more affordable rental units in Lake Oswego,as in most communities. FIGURE 3.7: PERCENTAGE OF HOUSEHOLD INCOME SPENT ON GROSS RENT,LAKE OSWEGO RENTER HOUSEHOLDS 35% 30% 29% 25% . 25% 22% 0 a, 20% o• 15% 14% 10% 7% s 5% 3% 0% � ■ �Oo�o y0I0 ��10 ���o ���o 0 L 10 �O �O t. Ot C� o o\o o %of Income to Gross Rent Sources: US Census,JOHNSON ECONOMICS Census Table: B25070(2021 ACS 5-yr Estimates) G. PUBLICLY ASSISTED HOUSING Oregon Housing and Community Services(OHCS)tracks three currently operating affordable housing properties in Lake Oswego,with a total of 76 units.These are properties that are funded through HUD programs,tax credits and other programs which guarantee subsidized rents for qualified households.All of these units,save one,are offered for elderly residents. The Marylhurst Commons, currently under development, is planned to offer 100 affordable units for families.Completion is expected in 2024. The Housing Authority of Clackamas County administers over 1,600 Section 8 housing choice vouchers that allow low-income participants to find rental units anywhere in the county. Under this program, the renters can find participating landlords and the voucher helps to subsidize the cost of a market-rate rental unit.The unit does not have to be in a property dedicated to subsidized affordable housing but can be in any rental property. The high share of renters still paying over 30% of their income towards housing costs indicates that there is an ongoing need for rental units at the lowest price points. Agricultural Worker Housing: Lake Oswego is not currently home to properties dedicated to agricultural workers. This population may also be served by other available affordable units. People Experiencing Homelessness: The Census does make a multi-faceted effort to include the unhoused population in the total Decennial Census count, by attempting to enumerate these individuals at service providers, and in transitory locations such as RV parks or campgrounds, as of the official Census data (4/1/20). However, it is difficult to make an accurate count of this population, and it is generally presumed that the unhoused are undercounted in the Census. The most recent (January 2022) Point-in-Time count of people experiencing homelessness and households experiencing homelessness in Clackamas County' found 597 unhoused individuals on the streets, in shelters, or Figures are for the entire County CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 15 PP 22-0005 ATTACHMENT 5/PAGE 16 OF 29 other temporary and/or precarious housing. The estimated 597 unhoused individuals represent 0.1% of the county's total estimated population in 2022. • An estimated 45%of individuals were in some sort of temporary shelter,while 55%were unsheltered. • The total included 51 children (under age 18),and 26 youth(aged 18-24). • Of those indicating a gender,60%of those counted identified as men,40%women. • 5%of those counted were Hispanic or Latino compared to 9.5%in the general population. • 304 individuals,or 51%,were counted as"chronically homeless".6 While the Point-in-Time count is one of the few systematized efforts to count people experiencing homelessness across the country in a regular, structured way, it is widely thought to undercount the population of unhoused individuals and households. People who are doubled up,couch surfing,or experiencing domestic violence may not always be accurately counted. In addition to the impossibility of finding all unsheltered individuals experiencing homelessness,the count is conducted in late January,when homeless counts are likely near their lowest of the year due to inclement weather. It also relies on self-reporting. A recent analysis prepared for OHCS to test a potential approach for preparing Housing Capacity Analyses on a regional basis included estimates of the unhoused population in Oregon communities, including Lake Oswego.The approach utilizes a combination of data from the bi-annual Point-in-Time count and from tracking of unhoused school-aged children in keeping with the McKinney-Vento Act.The analysis estimates 239 households experiencing homelessness in Lake Oswego as of mid-2020. These include households that are unsheltered, in temporary shelters, or staying with friends or relatives. These households are a component of current and future housing need. The persistence of people experiencing homelessness speaks to the need for continuing to build a full spectrum of services and housing types to shelter this population,from temporary shelter to subsidized affordable housing.An analysis of the ability of current and projected housing supply to meet the needs of low-income people and the potential shortfall is included in the following sections of this report. e HUD defines "chronically homeless" as an individual with a disability as defined by the McKinney-Vento Assistance Act,who has been in uninhabitable conditions for more than 12 mo.or on four separate occasions in the last three years;or has been in institutional care for less than 90 days;or a family with an adult head of household who meets this definition. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 16 PP 22-0005 ATTACHMENT 5/PAGE 17 OF 29 IV. CURRENT HOUSING NEEDS (CITY OF LAKE OSWEGO) The profile of current housing conditions in the study area is based on Census 2010, which the Portland State University Population Research Center(PRC) uses to develop yearly estimates through 2019.The 2019 estimate is forecasted to 2023 using the estimated growth rate realized since 2010. FIGURE 4.1:CURRENT LAKE OSWEGO HOUSING PROFILE(2023) CURRENT HOUSING CONDITIONS(2023) SOURCE Total 2023 Population: 41,550 PSU Pop.Research Center - Estimated group housing population: 329 (0.8%of Total) US Census Estimated Non-Group 2023 Population: 41,221 (Total-Group) Avg. HH Size: 2.36 US Census Estimated Non-Group 2023 Households: 17,481 (Pop/HH Size) Total Housing Units: 18,345 (Occupied+Vacant) Census 2010+permits Occupied Housing Units: 17,481 (=#ofHH) Vacant Housing Units: 864 (Total HH-Occupied) Current Vacancy Rate: 4.7% (Vacant units/Total units) Sources:Johnson Economics,City of Lake Oswego,PSU Population Research Center,U.S.Census *This table reflects population,household and housing unit projections shown in Figure 2.1 We estimate a current population of 41,550 residents, living in 17,481 households (excluding group living situations).Average household size is 2.4 persons. There are an estimated 18,345 housing units in the city, indicating an estimated vacancy rate of 5%.This includes units vacant for any reason, not just those which are currently for sale or rent. ESTIMATE OF CURRENT HOUSING DEMAND Following the establishment of the current housing profile, the current housing demand was determined based upon the age and income characteristics of current households. The analysis considered the propensity of households in specific age and income levels to either rent or own their home (tenure), in order to derive the current demand for ownership and rental housing units and the appropriate housing cost level of each.This is done by combining data on tenure by age and tenure by income from the Census American Community Survey(tables: B25007 and B25118, 2021 ACS 5-yr Estimates). The analysis takes into account the average amount that owners and renters tend to spend on housing costs. For instance, lower income households tend to spend more of their total income on housing, while upper income households spend less on a percentage basis. In this case, it was assumed that households in lower income bands would prefer housing costs at no more than 30% of gross income (a common measure of affordability). Higher income households pay a decreasing share down to 20%for the highest income households. While the Census estimates that most low-income households pay more than 30%of their income for housing,this is an estimate of current preferred demand. It assumes that low-income households prefer (or demand) units affordable to them at no more than 30%of income, rather than more expensive units. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 17 PP 22-0005 ATTACHMENT 5/PAGE 18 OF 29 Figure 4.2 presents a snapshot of current housing demand (i.e. preferences)equal to the number of households in the study area (17,481).The breakdown of tenure(owners vs. renters) reflects data from the 2021 ACS. FIGURE 4.2:ESTIMATE OF CURRENT HOUSING DEMAND IN LAKE OSWEGO(2023) Ownership Price Range #of Income Range /of Cumulative Households Total $0k-$80k 330 Less than $15,000 2.7% 2.7% $80k-$130k 267 $15,000-$24,999 2.2% 4.9% $130k-$180k 357 $25,000-$34,999 2.9% 7.8% $180k-$250k 636 $35,000-$49,999 5.2% 13.0% $250k-$350k 1,051 $50,000-$74,999 8.6% 21.7% $350k-$440k 1,147 $75,000-$99,999 9.4% 31.1% $440k-$510k 1,109 $100,000-$124,999 9.1% 40.2% $510k-$560k 892 $125,000-$149,999 7.3% 47.5% $560k-$680k 1,827 $150,000-$199,999 15.0% 62.5% $680k+ 4,577 $200,000+ 37.5% 100.0% Totals: 12,191 %of All: 69.7% Rental Rent Level #of Income Range /of Cumulative Households Total $0-$400 348 Less than $15,000 6.6% 6.6% $400-$700 383 $15,000-$24,999 7.2% 13.8% $700-$900 554 $25,000-$34,999 10.5% 24.3% $900-$1300 621 $35,000-$49,999 11.7% 36.0% $1300-$1800 837 $50,000-$74,999 15.8% 51.9% $1800-$2200 764 $75,000-$99,999 14.4% 66.3% $2200-$2500 505 $100,000-$124,999 9.6% 75.9% $2500-$2800 410 $125,000-$149,999 7.8% 83.6% $2800-$3400 271 $150,000-$199,999 5.1% 88.7% $3400+ 596 $200,000+ 11.3% 100.0% All Households Totals: 5,290 %of All: 30.3% 17,481 Sources: PSU Population Research Center,Claritas Analytics.,Census,JOHNSON ECONOMICS Census Tables: B25007,B25106,B25118(2021 ACS 5-yr Estimates) Claritas Analytics: Estimates of income by age of householder The estimated home price and rent ranges are irregular because they are mapped to the affordability levels of the Census income level categories. For instance, an affordable home for those in the lowest income category (less than $15,000)would have to cost$80,000 or less.Affordable rent for someone in this category would be$400 or less. The affordable price level for ownership housing assumes 30-year amortization,at an interest rate of 5%(somewhat less than the current market rate,but in line with historic norms),with 10%down payment.These assumptions are designed to represent prudent lending and borrowing levels for ownership households. The 30-year mortgage commonly serves as the standard. In the 2000's, down payment requirements fell significantly, but lending standards tightened significantly since the 2008/9 credit crisis. While 20% is often cited as the standard for most buyers,it is common for homebuyers,particularly first-time buyers,to pay significantly less than this using available programs. Interest rates are subject to disruption from national and global economic forces, and therefore impossible to forecast beyond the short term. The 5% used here is roughly the average 30-year rate over the last 20 years.The CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 18 PP 22-0005 ATTACHMENT 5/PAGE 19 OF 29 general trend has been falling interest rates since the early 1980's,but coming out of the recent inflationary period, the Federal Reserve has raised its base rate significantly in recent years and mortgage rates have also climbed to levels not seen in almost 20 years. CURRENT HOUSING INVENTORY The profile of current housing demand(Figure 4.2)represents the preference and affordability levels of households. In reality, the current housing supply (Figures 4.3 and 4.4 below) differs from this profile, meaning that some households may find themselves in housing units which are not optimal, either not meeting the household's own/rent preference, or being unaffordable(requiring more than 30%of gross income). A profile of current housing supply in Lake Oswego was estimated based on permit data from the City of Lake Oswego and Census data from the most recently available 2021 ACS, which provides a profile of housing types (single family, attached, manufactured home, etc.), tenure, housing values, and rent levels. The 5-year estimates from the ACS were used because margin of error is lower than 1-year ACS estimates. • An estimated 71% of housing units are ownership units, while an estimated 29% of housing units are rental units. This is slightly different than the estimated demand profile shown in Figure 4.2, which estimated a bit higher demand for rental units given local income and age levels.The inventory includes vacant units. • 81%of ownership units are detached homes,and very few are manufactured homes. 17.5%of rental units are either single family homes or manufactured homes,while 59%are in structures of 5 units or more. • Of total housing units, an estimated 63%are detached homes or manufactured homes. 37%are some sort of attached unit type. FIGURE 4.3:PROFILE OF CURRENT HOUSING SUPPLY BY TYPE(2023) Lake Oswego, Oregon 100% 81% ■Owner 80% 59% Rental 60% 0 0 v i1 40% 18% 20% 10% a 13% - 6/0 0% 5/ 3% 6% 0% 0% 0% 0% 0% Single Single Duplex 3-or 4-plex 5+Units MFR Manuf. Boat,RV, Detached Attached home other temp Unit Type Sources: US Census,PSU Population Research Center,JOHNSON ECONOMICS Census Tables: B25004,B25032,B25063,B25075(2021 ACS 5-yr Estimates) • The affordability of different unit types is an approximation based on Census data on the distribution of housing units by value(ownership)or gross rent(rentals). • Most subsidized affordable housing units found in the city are represented by the inventory at the lowest end of the rental spectrum. • Ownership housing found at the lower end of the value spectrum generally reflect older, smaller homes, or homes in poor condition on small or irregular lots. It is important to note that these represent estimates of CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 19 PP 22-0005 ATTACHMENT 5/PAGE 20 OF 29 current property value or current housing cost to the owner,not the current market pricing of homes for sale in the city. These properties may be candidates for redevelopment when next they sell but are currently estimated to have low value. FIGURE 4.4:PROFILE OF CURRENT HOUSING SUPPLY,ESTIMATED AFFORDABILITY IN LAKE OSWEGO(2023) Ownership Housing Rental Housing Affordable Estimated Affordable Estimated Income Range Share of Total Units Price Level Units Rent Level Units Less than$15,000 $0k-$80k 135 $0-$400 70 I 1% $15,000-$24,999 $80k-$130k 129 $400-$700 43 I 1% $25,000-$34,999 $130k-$180k 170 $700-$900 106 I 2% $35,000-$49,999 $180k-$250k 406 $900-$1300 518 • 5% $50,000-$74,999 $250k-$350k 735 $1300-$1800 1,852 14% $75,000-$99,999 $350k-$440k 839 $1800-$2200 1,289 12% $100,000-$124,999 $440k-$510k 753 $2200-$2500 602 7% $125,000-$149,999 $510k-$560k 924 $2500-$2800 223 6% $150,000-$199,999 $560k-$680k 2,217 $2800-$3400 229 13% $200,000+ $680k+ 6,700 $3400+ 404 39% 71% 13,008 29% 5,337 0% 10% 20% 30% 40% Sources: US Census,PSU Population Research Center,JOHNSON ECONOMICS Census Tables: B25004,B25032,B25063,B25075(2021 ACS 5-yr Estimates) ■ Most housing (58%) in Lake Oswego is found in price and rent levels affordable to those earning at least $125,000 per year,which is close to the city's median income.There is very little housing available to those in lower income segments. Over 90% of housing is affordable to those earning at least $50,000, and only 9% affordable to those earning less than this. COMPARISON OF CURRENT HOUSING DEMAND WITH CURRENT SUPPLY A comparison of estimated current housing demand with the existing supply identifies the existing discrepancies between needs and the housing which is currently available. The estimated number of units outnumbers the number of households by roughly 865 units, indicating an average vacancy rate of 4.7%. In general, this identifies that there is currently support for more ownership housing at lower price points, while the upper end of the market is generally well supplied.This is because most housing in Lake Oswego is clustered at higher property values, which matches the community's high average household income but leaves some households underserved. The analysis finds that the current market rates for most rental units are in the $1,300 to $2,200/month range. Therefore,this is where most of the rental unit supply is currently clustered. However,the greatest unmet need is found at the lower end of the income scale, where many current renters pay more than 30% of their income in housing costs. Rentals at the most expensive levels generally represent single family homes for rent. Figures 4.5 and 4.6 present this information in chart form,comparing the estimated number of households in given income ranges,and the supply of units currently valued(ownership)or priced(rentals)within those income ranges. The data is presented for owner and renter households. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 20 PP 22-0005 ATTACHMENT 5/PAGE 21 OF 29 FIGURE 4.5:COMPARISON OF OWNER HOUSEHOLD INCOME GROUPS TO ESTIMATED SUPPLY AFFORDABLE AT THOSE INCOME LEVELS IN LAKE OSWEGO(2023) Owner Households vs.Current Units 7,000 N 6,000 •Est.Owner Households Y_ 7 5,000 Units Valued at Income Level 4,000 0 v 3,000 0 0 2,000 I 0 1,000 . . . . 0 — 0 0 0 0 0 0 x0 o 0 0 0 0 o o o0 � � � 0 0 0 0 � O h, b, b �, , ,Ab' 0 1, b 0) 0,hy L q h 0 c � � a 0 0 0 0 00 0 0 0 0 0 0 0r0 0 0 0 0 0 0 0 '5 0 uh 0 0 0 e qqhh 0% h, 0, te h 0 h hti hti hti Income Cohorts Sources: PSU Population Research Center,City of Lake Oswego,Census,JOHNSON ECONOMICS FIGURE 4.6:COMPARISON OF RENTER HOUSEHOLD INCOME GROUPS TO ESTIMATED SUPPLY AFFORDABLE AT THOSE INCOME LEVELS IN LAKE OSWEGO(2023) Renter Households vs.Current Units 2,000 Est.Renter Households N E 1,500 Units Affordable at Income Level o -6 1,000 v VI 3 = 500 o ■ ■ I II 1 . A o 0 c c c c, c,) X0 ) ) , 0) o 0) 0) 0)0 � � � � g o e o o° h, , , h, C, ,b, �, 0, 0 b At' L b 0 0'y L h h 0 tzti ho c . L e 0 0 0 0 0 0 0 0 0 0 0 0 0r 0 0 0 0 0 0 0 0 tee, hyh, h,Lh, h,"h, hh0, huh, 00, �h0 h0, hti hti hti Income Cohorts Sources: PSU Population Research Center,City of Lake Oswego,Census,JOHNSON ECONOMICS The home value and rent segments which show a "surplus"in Figures 4.5 and 4.6 illustrate where current property values and market rent levels are in Lake Oswego. Housing prices and rent levels will tend to congregate around those levels.These levels will be too costly for some(i.e.require more than 30%in gross income)or"too affordable" for others(i.e.they have income levels that indicate they could afford more expensive housing if they chose). In general, these findings demonstrate that there are few lower-value housing opportunities for many owner households, and potential support for some less expensive types of ownership housing.There is a need for more rental units at lower rent levels(<$900/mo.). HOME SALE PRICES It is important to note that the figures presented in the prior section represent estimates of current property value or current housing cost to the owner, not the current market pricing of homes for sale in the city. For instance, a household living in a manufactured home that has been paid off over many years may have relatively CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 21 PP 22-0005 ATTACHMENT 5/PAGE 22 OF 29 low housing costs.This indicates that one owner household is living in a"lower value"unit. It does not indicate that units at this price point are available on the current market. If this hypothetical household were to sell their home,it would sell at a higher price reflecting inflation and current achievable market prices. For this reason,many of the lower value or lower rent units found in the previous section will actually become higher-priced units when they are sold or become vacant. For reference,this section presents home sales data from 2022 to indicate housing costs for new entrants into the market(Figure 4.7). • The median sale price was$860,000. • The average(mean)sale price was$1,075,000. • The average price per square foot was$430/s.f. • The median square footage was 2,300 s.f. FIGURE 4.7:LAKE OSWEGO HOME SALES(12 MONTHS) Home Sales by Unit Type Home Sales by Price Level $900,000+ 319 $800,000-$899,000 66 20% $700,000-$799,000 67 $600,000-$699,000 56 8% $500,000-$599,000 ■ 39 0 0 72% $400,000-$499,000 . 31 $300,000-$399,000 47 $200,000-$299,000 ■ 43 $100,000-$199,000 13 Detached Home Manuf. Home <$100,000 0 Attached Home Condo 0 100 200 300 400 Sources: RMLS,JOHNSON ECONOMICS • 48%of sales were priced above$900,000. • 34%of sales were priced between $500,000 and $899,000. • Only 18%of sales were priced at less than$500,000. • Only 7%of sales were priced below$300,000. Affordability: As indicated, roughly 75% of recent sales in Lake Oswego were priced at least $600,000. Homes in this range would be mostly affordable to households earning at least $175,000 per year, which is well above the median household income of$123,000. Roughly 66% of households earn less than $175,000 per year, meaning that the bulk of housing supply on the current for-sale market(75%) is likely too expensive for most of these households. The findings of current need form the foundation for projected future housing need, presented in the following section. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 22 PP 22-0005 ATTACHMENT 5/PAGE 23 OF 29 V. FUTURE HOUSING NEEDS- 2043 (CITY OF LAKE OSWEGO) The projected future(20-year)housing profile(Figure 5.1)in the study area is based on the current housing profile (2023), multiplied by an assumed projected future household growth rate. The projected future growth is the forecasted 2043 population for the City of Lake Oswego included in the most recently adopted Coordinated Population Forecast from Metro for all cities in the region.This was adopted in 2021 and projected a very modest growth rate for Lake Oswego of well less than 1%per year. FIGURE 5.1:FUTURE HOUSING PROFILE(2043), LAKE OSWEGO PROJECTED FUTURE HOUSING CONDITIONS(2023-2043) SOURCE 2023 Population(Minus Group Pop.) 41,221 (Est.2022 pop.-Group Housing Pop.) PSU Projected Annual Growth Rate 0.05% Metro Coordinated Forecast(2021) Metro 2043 Population(Minus Group Pop.) 41,629 (Total 2043 Population-Group Housing Pop.) Estimated group housing population: 332 1.7%of total pop.(held constant from 2022) US Census Total Estimated 2043 Population: 41,961 Metro Coordinated Forecast(2021) Metro Estimated Non-Group 2043 Households: 19,298 Metro Coordinated Forecast(2021) Metro New Households 2023 to 2043 1,816 Avg. Household Size: 2.16 Projected 2043 pop./2043 houseolds US Census Total Housing Units: 20,313 Occupied Units plus Vacant Occupied Housing Units: 19,298 (=Number of Non-Group Households) Vacant Housing Units: 1,016 (=Total Units-Occupied Units) Projected Market Vacancy Rate: 5.0% Stabilized vacancy assumption Sources: PSU Population Research Center,Metro,Census,JOHNSON ECONOMICS LLC *Projections are applied to estimates of 2023 population,household and housing units shown in Figure 2.1 The model projects growth in the number of non-group households over 20 years of over 1,800 households, but with accompanying population growth of just 411 new residents. The difference is that the household size is expected to decrease significantly to 2.2 persons,meaning more smaller households to house the same population. (The number of households differs from the number of housing units, because the total number of housing units includes a percentage of vacancy. Projected housing unit needs are discussed below.) PROJECTION OF FUTURE HOUSING UNIT DEMAND(2043) The profile of future housing demand was derived using the same methodology used to produce the estimate of current housing need. This estimate includes current and future households but does not include a vacancy assumption. The vacancy assumption is added in the subsequent step. Therefore,the need identified below is the total need for actual households in occupied units (19,298). The analysis considered the propensity of households at specific age and income levels to either rent or own their home, in order to derive the future need for ownership and rental housing units, and the affordable cost level of each.The projected need is for all 2043 households and therefore includes the needs of current households. The price levels presented here use the same assumptions regarding the amount of gross income applied to housing costs,from 30%for low income households down to 20%for the highest income households. The affordable price level for ownership housing assumes 30-year amortization,at an interest rate of 5%,with 10% down payment. Because of the impossibility of predicting variables such as interest rates 20 years into the future, CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 23 PP 22-0005 ATTACHMENT 5/PAGE 24 OF 29 these assumptions were kept constant from the estimation of current housing demand. Income levels and price levels are presented in 2023 dollars. Figure 5.2 presents the projected occupied future housing demand(current and new households,without vacancy) in 2043. FIGURE 5.2:PROJECTED OCCUPIED FUTURE HOUSING DEMAND(2043), LAKE OSWEGO Ownership #of Price Range Households Income Range %of Total Cumulative $0k-$80k 364 Less than$15,000 i 2.7% 2.7% Extremely <30%MFI $80k-$130k 295 $15,000-$24,999 2.2% 4.9% Low Income $130k-$180k 394 $25,000-$34,999 2.9% 7.8% Very Low <50%MFI $180k-$250k 702 $35,000-$49,999 5.2% 13.0% Income $250k-$350k 1,160 $50,000-$74,999 8.6% 21.7% Low Income <80%MEI $350k-$440k 1,266 $75,000-$99,999 9.4% 31.1% $440k-$510k 1,224 $100,000-$124,999 9.1% 40.2% $510k-$560k 984 $125,000-$149,999 7.3% 47.5% $560k-$680k 2,017 $150,000-$199,999 15.0% 62.5% $680k+ 5,053 $200,000+ 37.5% 100.0% Totals: 13,458 %of All: 69.7% Rental #of Rent Level Income Range %of Total Cumulative Households $0-$400 385 Less than$15,000 6.6% 6.6% Extremely <30%MFI $400-$700 423 $15,000-$24,999 7.2% 13.8% Low Income $700-$900 611 $25,000-$34,999 10.5% 24.3% Very Low <50%MFI $900-$1300 686 $35,000-$49,999 11.7% 36.0% Income $1300-$1800 924 $50,000-$74,999 15.8% 51.9% Low Income <80%MFI $1800-$2200 843 $75,000-$99,999 14.4% 66.3% $2200-$2500 558 $100,000-$124,999 9.6% 75.9% $2500-$2800 453 $125,000-$149,999 7.8% 83.6% $2800-$3400 299 $150,000-$199,999 5.1% 88.7% $3400+ 658 $200,000+ 11.3% 100.0% All Units Totals: 5,840 %of All: 30.3% 19,298 Sources: Census,Claritas Analytics,JOHNSON ECONOMICS The number of households across the income spectrum seeking a range of both ownership and rental housing is anticipated to grow. It is projected that the homeownership rate in Lake Oswego will fall somewhat over the next 20 years to under 70%from 71%. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 24 PP 22-0005 ATTACHMENT 5/PAGE 25 OF 29 COMPARISON OF FUTURE HOUSING DEMAND TO CURRENT HOUSING INVENTORY The profile of occupied future housing demand presented above(Figure 5.2)was compared to the current housing inventory presented in the previous section to determine the total future need for new housing units by type and price range(Figure 5.3). This estimate includes a vacancy assumption. As reflected by the most recent Census data, and as is common in most communities, the vacancy rate for rental units is typically higher than that for ownership units. An average vacancy rate of 5%is assumed for the purpose of this analysis. FIGURE 5.3: PROJECTED FUTURE NEED FOR NEW HOUSING UNITS(2043), LAKE OSWEGO OWNERSHIP HOUSING Multi-Family Single Single 3-or 4- 5+Units Manuf. Boat,RV, Total %of Unit Type: 2-unit Detached Attached plex MFR home other temp Units Units Totals: 708 132 31 57 92 3 0 1,024 52.0% Percentage: 69.2% 12.9% 3.1% 5.6% 9.0% 0.2% 0.0% 100% RENTAL HOUSING Multi-Family Single Single 3-or 4- 5+Units Manuf. Boat,RV, Total %of Unit Type: 2-unit Detached Attached plex MFR home other temp Units Units Totals: 52 87 73 148 585 0 0 944 48.0% Percentage: 5.5% 9.2% 7.7% 15.7% 61.9% 0.0% 0.0% 100% TOTAL HOUSING UNITS Multi-Family Single Single 3-or 4- 5+Units Manuf. Boat,RV, Total %of Unit Type: 2-unit Detached Attached plex MFR home other temp Units Units Totals: 760 220 104 205 677 3 0 1,968 100% Percentage: 38.6% 11.2% 5.3% 10.4% 34.4% 0.1% 0.0% 100% Sources: PSU,City of Lake Oswego,Census,Claritas Analytics,JOHNSON ECONOMICS • The results show a need for 1,968 new housing units by 2043. • Of the new units needed, roughly 52% are projected to be ownership units, while 48% are projected to be rental units.This represents more renters than the estimated tenure split, but it is projected that more rental units will need to be added to correct the current modest deficit of rental units,plus the future ownership rate will fall slightly. This results in a proportionately greater share of future units being rental, rather than ownership units. • There is some need for new ownership housing at the middle to low-end of the pricing spectrum. But income trends suggest that the greatest demand will remain in the upper-middle price ranges($300k to$600k). • The greatest need for rental units is found at the lowest and some higher price points. Market rents are currently clustered in the $1,300 to $2,200 range in current dollars.Therefore, most units are to be found in this range. • There is insufficient rental housing for the lowest income households making $35,000 or less or detached single-family homes for rent. Many households will need rent levels lower than the market rate in order to maintain housing costs that are affordable(see more detail below). CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 25 PP 22-0005 ATTACHMENT 5/PAGE 26 OF 29 Needed Unit Types The mix of needed unit types shown in Figure 5.3 reflects both past trends and anticipated future trends. Single detached units are expected to continue to make up a large share of new housing development for ownership households over the next 20 years. However,an increasing share of new needed units is anticipated to be attached housing types to accommodate renters and first-time home buyers. ■ 39%of the new units are projected to be single detached homes or new manufactured homes, while 61% is projected to be some form of attached housing. ■ Single attached units(townhomes on individual lots)are projected to meet roughly 11%of future need. These are defined as units on separate tax lots,attached by a wall but separately metered,the most common example being townhome units. ■ Duplex,triplex, and four-plex units are projected to represent a growing 16%of the total need, reflecting new state rules for middle housing zoning. Duplex units would include a detached single-family home with an accessory dwelling unit on the same lot, or with a separate unit in the home (for instance, a rental basement unit.) ■ 34%of all needed units are projected to be multi-family in structures of 5+attached units. ■ Less than 1% of new needed units are projected to be manufactured home units, which meet the needs of some low-income households for both ownership and rental. ■ Of ownership units, 69% are projected to be single detached homes or manufactured homes, and 31% are projected to be attached forms. ■ Nearly all new rental units are projected to be found in new attached buildings, with 62% projected in rental properties of 5 or more units, and 33% in other attached housing forms. Only 5.5% of new rental units are projected to be detached homes, including manufactured homes. Group Housing Needs: There is an estimated population of 332 individuals living in group housing in 2043, based on an assumption that the share of the population living in group quarters (1.7%) remains stable from current levels. This would represent an increase of just a few people living in group quarters, as forecasted population growth is modest. In Lake Oswego, the Census estimates that nearly all of Lake Oswego's group housing population lives in nursing facilities. NEEDED AFFORDABILITY LEVELS Figure 5.4 presents the estimated need for net new housing units by major income segment,based on the projected demographics of new households to the market area.The needed affordability levels presented here are based on current dollars. Figure 5.4 also discusses the housing types typically attainable by residents at these income levels. Note that Figure 5.4 presents the official state measure of "low income" used to set rent and income limits for various affordable housing programs. This estimate via OHCS and HUD are based on an estimate of median income in Clackamas County of$106k in 2022, based on a family of four,while the median income in Lake Oswego was a higher$123k. For this analysis,the estimated Median Family Income(MFI)for a family of four($106k)was adjusted to match the average household size in Lake Oswego of 2.4 persons ($89.5k) so that the estimates presented below reflect the city average. Figure 5.4 presents some of the types of housing product that might commonly serve households in these income ranges. Many households below 60% MFI or even higher income will require some sort of subsidized affordable unit or voucher to find housing affordability.Those at 60%to 100%MFI may find housing in older and substandard market rate rentals, manufactured homes,and middle housing types. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 26 PP 22-0005 ATTACHMENT 5/PAGE 27 OF 29 FIGURE 5.4: PROJECTED NEED FOR NEW HOUSING AT DIFFERENT INCOME LEVELS, LAKE OSWEGO Income Level Owner Renter Household Income Segment Total Share Common Housing Product (Rounded) Units Units Government-subsidized;Voucher; Extremely Low Inc. <30%MEI <$27,500 56 149 205 10% Shelter;Transitional Aging/substandard rentals; Very Low Income 30%-60%MFI $27.5k-$55k 95 221 317 16% Government-subsidized;Voucher; Manufactured homes Aging apartments;Government- Low Income 60%-80%MFI $55k-$73k 71 120 190 10% subsidized; Plexes;Aging single- detached;Small homes Single-detached homes; Middle Income 80%-120%MFI $73k-$110k 134 172 306 16% Townhomes; Condominiums; Newer apartments Single-detached homes; Upper Income >120%MFI >$110,000 669 282 951 48% Townhomes; Condominiums; New apartments TOTAL: 1,024 944 1,968 100% Sources: HUD,Census,Claritas,JOHNSON ECONOMICS ■ Figure 5.3 presents the net NEW housing unit need over the next 20 years. However, there is also a current need for more affordable units. For all households,current and new,to pay 30%or less of their income towards housing in 2043, more affordable rental units (subsidized and non-subsidized) would be required. This indicates that some of the current supply, while it shows up as existing available housing, would need to become less expensive to meet the needs of current households. ■ There is a finding of new need at the lowest end of the rental spectrum($900 and less). ■ The projection of future ownership units finds that the supply at the lowest end of the spectrum will be insufficient due to the prevalence of newer homes, many of which will be detached houses. (This reflects the estimated value of the total housing stock, and not necessarily the average pricing for housing currently for sale.) Ownership options and lower and middle price points are often manufactured homes, townhomes, condos,and small detached homes, often on smaller lots. Subsidized Affordability Housing Need As alluded to in Figure 5.4, some low-income households, and particularly the lowest income households typically need some sort of subsidized affordable housing in order to find rents affordable given their modest resources and other household spending needs. Figure 5.5 below presents estimates of need at key low-income affordability levels in 2022 and in 2043.The table uses HUD definitions of Extremely Low, Very Low, and Low Income, as well as 60% MFI which is a common affordability level for tax credit properties. ■ There is existing and on-going need at these levels, based on income levels specified by OHCS for Clackamas County. An estimated 12%of households qualify as at least"low income"or lower on the income scale,while 9% of households qualify as "extremely low income". (Again, this is based on the official state measure of Clackamas County median income for application to HUD and other subsidized affordable housing programs, which is relatively high.) CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 27 PP 22-0005 ATTACHMENT 5/PAGE 28 OF 29 FIGURE 5.5: PROJECTED NEED FOR HOUSING AFFORDABLE AT LOW INCOME LEVELS,LAKE OSWEGO Current Need(2022) Future Need(2043) NEW Need(20-Year) Affordablilty Level Income Level* #of Units %of All #of Units %of All #of Units %of All Extremely Low Inc. 5 30%MFI 5 $26,800 1,492 9% 1,697 9% 205 10% Very Low Income 30%-50%MFI <_ $44,700 1,560 9% 1,771 9% 212 11% Low Income 50%-80%MFI <_ $71,600 2,075 12% 2,370 12% 295 15% TOTAL: 5 80%MF1 5 571,600 5,127 29% 5,839 30% 712 36% Tax Credit <_60%MFI <_ $53,700 3,962 23% 4,483 23% 521 26% Sources: OHCS,Claritas,JOHNSON ECONOMICS,HUD *Income levels are based on OHCS guidelines for avg.Lake Oswego household size of 2.4 persons. ■ Typically, only rent-subsidized affordable properties can accommodate these extremely-low-income households and many other low-income households at "affordable" housing cost levels. Often the lowest income households must be served by housing choice vouchers and public housing. Tax credit projects are more likely to serve those earning 50%to 60%of MFI. Housing Need for People Experiencing Homelessness: Given the low forecasted population growth, Lake Oswego is assumed to maintain a fairly stable number of unhoused individuals and households over this period. Unhoused individuals and families may require a mixture of shelter types depending on individual circumstances,ranging from emergency shelter to transitional housing to permanent subsidized housing. This population is a subset of the extremely-low-income population shown in prior figures. Agricultural Worker Housing:There is currently no housing dedicated to this population in Lake Oswego. Based on the assumption that this type of housing will maintain its current representation in the local housing stock, this indicates that there will likely be no new need for housing dedicated specifically for agricultural workers over the planning period. However,this population may also be served by other available affordable units. CITY OF LAKE OSWEGO I HOUSING CAPACITY ANALYSIS PAGE 28 PP 22-0005 ATTACHMENT 5/PAGE 29 OF 29