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LOC CONSULTING Median Household Income Market Analysis for Downtown Redevelopment City of Centerville Economic Development Authority April 3, 2023 Figures 2.9 shows the median household income for the drive -time rings, the Centerville PMA, and comparison areas. Figure 2.10 shows a visualization of this data with the blue bars representing the median incomes and the orange triangles showing the annual projected growth (right axis). ■ The median household income for the Downtown Centerville PMA is about $104,000, about 14% higher than the Twin Cities Metro Area. ■ Incomes in immediate areas around downtown are higher than the PMA as a whole. Both the City of Centerville itself and the five-minute drive time area have higher median incomes than the PMA. Income growth and decline can be caused by new households moving into or out of the PMA, or by changes in incomes that occur as households in an area age. Inflation is also driving increases. In the PMA, median incomes are projected to grow by about 1.9% per year over the period. Incomes above the Metro Area average are attractive to retailers, especially those that target discretionary sales. Housing developers also consider incomes when analyzing the feasibility of residential development. Using a median household income of $104,000, the median household could afford to spend about $18,000 on housing per year —or about $2,600 per month. (This assumes these households spend 30% of their income on housing.) Map 2.11 shows median household incomes by Census Block Group in 2022. The maps shows that generally incomes are high across the PMA, with pockets of particularly higher income households in the eastern and southern portions of Lino Lakes and the City of North Oaks. Households by Age and Income Figure 2.12 shows households by age and income for the Downtown Centerville PMA. Figure 2.12 shows median household income by age for the PMA and the Metro Area. The majority of household growth is projected to occur in households over age 65 and in higher income groupings. Many of these households are resident households aging into these groups, not new households to the area. Many may be looking for maintenance free housing options that could be provided in Downtown Centerville. ■ Little growth is projected for the age 15-to-34- year-old households, across all incomes. These age groups are one of the primary markets for general occupancy rental housing. ■ The data from Figure 2.12 is used in the demand projections found in the Appendix of this report. Figure 2.13 shows the distribution of income across age groups. Generally, incomes increase as householders age into their 40s and 50s—their peak earning years —and then begin to decline as those householders begin to move out of the labor market. ■ Median household incomes in the Downtown Centerville PMA are higher than the Metro Area across all age groups. Median Home Values Figures 2.14 shows the median home value for the drive -time rings, the Centerville PMA, and comparison areas. ■ The estimated median home value for the Downtown Centerville PMA is about $330,000. ■ As shown with the drive -time area home values, median values for homes closer to Downtown Centerville tend to be higher than those further away. Renter versus Owner Households Figure 2.15 shows the percentage of households that rent their homes for the drive -time rings, the Centerville PMA, and comparison areas. This data is from the American Community Survey of the US Census. ■ About one in five (20.2%) households rent in the Downtown Centerville PMA. Page 28