The document summarizes findings from a panel discussion on a city housing study. It presented information on housing trends, the local housing market, gaps identified, and draft recommendations. The recommendations focused on developing strategies for suburban, urban, and affordable housing. Specific ideas proposed modifying codes to allow accessory units, identifying areas for higher density near activity centers, and developing review processes for infill development. The panel then discussed challenges and opportunities for the different strategies.

1. Panel Discussion:
Key Findings and Draft
Recommendations
November 19, 2012

2. Team Introduction
John Bridger, Executive Director
Yuen Lee, Project lead
Sue Knapp
Tim Moreland
Aleeta Zeller

3. City Housing Study Main
Objectives
Characterize current and future housing
demand
Characterize the housing supply within
Chattanooga City limits / Hamilton County
Create a Framework for Action

4. Meeting Flow Agenda
Part I: Presentation of study findings on
how the housing market is
changing
Panel Discussion followed by a few
questions from the audience
Part II: Presentation of draft
recommendations across four
focus areas followed by a few questions
Panel Discussion
from the audience
Part III: Public Feedback: Break into
stations

5. HOUSING SYSTEM PRIMER
Housing – Part of a Place that Supports a
Lifestyle
The Housing Market Players
Key National Trends in Housing that will
impact Chattanooga

6. Housing - Part of a Place that Supports a
Lifestyle
Urban Places Lifestyle Traits
 Residential,  Live, Work, Shop, Play in clos
clo
Commercial, Civic,
Industrial in close
proximity
 Neighborhoods have  Diverse social environment
a mix of housing
types on small lots
 Grid street network  Walk, bike, transit, car
that distributes traffic,
supported by transit

7. Housing - Part of a Place that Supports a
Lifestyle
Suburban Places Lifestyle Traits
 Residential,  Neighborhood seclusion
Commercial,
Civic, Industrial
separated
 Neighborhoods  Predictable social
defined by a environment
single housing
type
 Limited street
 Drive to work, play, shop
network defined
by hierarchy

8. Housing Market – The Players
CONSUMER CONNECTOR SUPPLIER
BUYER/
RENTER  REALTOR  PRIVATE
 PUBLIC/ BUILDER/
PRIVATE DEVELOPE
CAPITAL R
 RENTAL PROPERTY
MANAGER
 CHATTANOOGA
HOUSING
AUTHORITY
 NON-PROFIT
PUBLIC POLICY/
CODES ORGANIZATION
PUBLIC POLICY/CODES

9. Housing Primer
Key Questions:
How are our lifestyles changing?
How is the housing market changing?
What does this mean for housing in urban
and suburban places?

10. Housing – Key National Lifestyle
Trends
DRIVERS OF HOUSING DEMAND

11. Housing – Key National Lifestyle
Trends
GENERATION Y
largest generation in U.S.
history, nearly ¼ of US
population and will continue to
grow with immigration
Ethnically more diverse, more
likely to have grown up in
metro area
Just starting to form
households; household
formation will accelerate over
time

12. Housing – Key National Lifestyle
Trends
GENERATION Y – Lifestyle/Housing Preference
ULI Survey of 18 – 32 age group: 38% currently rent,
36% currently own, 26% currently live with family or in
student housing *
2/3 favor living where they can experience shopping
and social gathering places within walking distance of
home *
22% expect to walk, bike or use transit *
Will be looking for their first home, but not like their
parents’ **
Sources
* Generation Y: America’s New Housing Wave, ULI Foundation, 2011
** Generation Y in the Market Place, Robert Charles Lesser & Co, 2009

13. Housing – Key National Lifestyle
Trends
BABY BOOMERS & SENIORS
Baby Boomers, 46 -
64years old, 76 million
strong, transitioning to
65+
65 + Population expected
to grow 120% by 2050,
reaching 1/5 of US
Population
Sources
* Housing an Aging Population, Are We Prepared?, Center for Housing Policy,
April 2012
** Housing in America, The Baby Boomers Turn 65, ULI Foundation, 2012

14. Housing – Key National Lifestyle
Trends
BABY BOOMERS & SENIORS: Lifestyle/Housing
Preference
Highest homeownership rate (80%)
among all generations and most likely
to live in suburbs **
More than 80% want to stay in their
home.. “Age in Place” desire to stay in
their home as long as possible*
Challenge – adapting
homes/communities to their changing
needs *
Implications – home modification,
multi-generational housing, senior
assisted living, alternative
Sources
transportation, greater demand for
* Housing an Aging Population, Are We Prepared?, Center for Housing Policy,
community facilities nearby **
April 2012

15. Housing – Key Economic Trends
HE “NEW NORMAL” ECONOMY AND AFFORDABILITY
Households are more stressed financially, while
housing costs continue to rise

16. Housing – Key Economic Trends
HE “NEW NORMAL” ECONOMY AND AFFORDABILITY
The Impact of affordability is even more severe for low to
moderate income families

17. Trends in the Local Chattanooga
Housing Market
Demographic Trends - Census
Market – Building Data
Surveys of Builders & Realtors
Focus Groups: residents, neighborhoods, non-profit
housing group, LDO & Neighborhood Services

19. Demographic Trends
Families with Children
Chattanooga
1970 2010
Married Couple
Single Father
Families
Single Mother Families

20. Demographic Trends
Chattanooga
BOOMERS
BOOMERS
GEN Y
BABY
BABY

22. MLS data – number of home sales
Single Family Detached 4664
3550
3183

23. MLS data – housing type

24. MLS data – sale price
Average Sale
Price % change
TOTAL 38.3%
Condo 107.1%
Townhouse 57.9%
SF Detached 36.1%
$ 213,086
$ 185,158
$ 178,482
$ 176,333
$ 129,568
$129,036
$ 117,269
$ 102,885

25. Building Permits
Townhouse, Condo, Single
Duplex, Apartment Family
Detached

26. Survey – Projected Demand
Realtors Builders

27. Survey – Buyer Home Preferences
RealtorsBuilders

28. Survey – Neighborhood Amenities
Realtors Builders

29. Survey – Community Amenities

30. Gaps in Housing
Housing Choice
“Focus on age related
communities - match with their
needs- it's about lifestyle now,
not just a house”
“More condo/townhome living
with amenities”
“More quality housing but
smaller in size”
“Build closer in to work, schools
and shopping due to gas costs”

31. Gaps in Housing
Finance
“Credit and
appraisals remain
difficult”
“Difficulty of obtaining
funding sours some,
causing them to
continue renting”
“lack of construction
and mortgage
financing”

32. Gaps in Housing
Affordability
“Demand for lower-priced new
homes is increasing”
“Affordable ‘quality’ housing
within the urban Chattanooga”
“More affordable starter family
homes in the Ooltewah area”
“Affordable housing options
aren’t zoned for the better rated
schools”
“Affordable housing options not
very close to services”

33. Gaps in Housing
Regulations
“Allow more mixed use in terms
of housing type and commerce
type”
“Better zoning options for urban
residential”
“Change zoning regulations to
reflect change in
demographics”
“Allow smaller street widths and
less stormwater issues”

34. Codes and Regulations
ENFORCEMENT
“Exceed current building codes
in construction, after all, codes
are a minimum, and people want
better”
“Make owners of the abandoned
homes to be accountable for
either tearing them down or
maintain them”
“Enforcing people to maintain
the exterior appeal of their
home”
“Consistency with
requirements and
enforcement”

35. Affordability

36. Affordability - RENTAL
Chattanooga Median Household Income $32,791
Monthly Gross Income $2,733
Income available for monthly gross housing cost (30%) $820
Monthly utility cost $200
Gross Income available for monthly rent $620
Chattanooga Median Gross Rent
$685
Chattanooga average rent for apartment
$732
Housing Cost Burden $112 -
$65
# of household with income less than $35,000
37,033
Source: 2011 ACS 1-year Estimates
www.aptindex.com

37. Affordability - OWNERSHIP
Chattanooga Median Household Income $32,791
Monthly Gross Income $2,733
Monthly Debts $500
Expected Down Payment $10,000
Interest Rate for 30- year Mortgage
3.8%
Home Insurance $480
Property Tax
$1,100
Annual Mortgage Insurance
$600
Affordable Home Amount
$90,000
All MLS Properties
1,098 Properties $100,000 or less
MLS
325
MLS Properties $75,000 or less
220
Average Housing Cost per sq ft
$110
Affordable Housing S ize 820
Source: 2011 ACS 5-year Estimates, http://cgi.money.cnn.com , www.bankrate.com, www.century21.com,
http://www.mlsarealistings.com http://www.nahb.org

38. Affordability – housing burden
All Owners Renters
Source: 2006-2010 American Community Survey 5-Year Estimates, B25106

39. Affordability
Owners Renters
Source: 2006-2010 American Community Survey 5-Year Estimates, B25106

40. Household Income Less than $20,000

41. Affordability
Housing Cost: 30% of a household
income
Transportation Cost: 15% of household income
True affordability
Housing + Transportation Cost: 45% of
household income

42. PANEL FEEDBACK/DISCUSSION

43. CHALLENGE – ADAPTING OUR PLACES TO
OUR CHANGING LIFESTYLES & NEW
ECONOMIC REALITIES
WHAT IS OUR SUBURBAN STRATEGY?
WHAT IS OUR URBAN STRATEGY?
HOW DO WE INCREASE THE SUPPLY
OF AFFORDABLE HOUSING?
HOW DO WE ELIMINATE BARRIERS
TO INFILL HOUSING DEVELOPMENT?

44. Feel free update as you see fit.
Housing Study
Recommendations
Setting a Course for ACTION

45. Setting a Course for Action…
Key Principles:
Strategies should be place-based and informed by anticipated
changing lifestyle needs in those places
Strategies should reflect the connection between housing,
schools, transportation, employment, public health, recreation
that shape our quality of life
Strategies should address the needs of the entire housing spectrum
(incomes and housing types)
Strategies should take into consideration the entire housing delivery
system in meeting those needs
Strategies should target private, public and public-private
opportunities to achieve housing objectives
Benchmarks should be established to track progress in meeting
housing strategy objectives

46. Setting a Course for Action…
Action Focus Areas:
SUBURBAN STRATEGY
URBAN STRATEGY
AFFORDABLE HOUSING
STRATEGY
ALIGN CODES/POLICIES TO
PROMOTE URBAN INFILL AND
AFFORDABILITY

47. Setting a Course for Action…
SUBURBAN STRATEGY

48. SUBURBAN STRATEGY
Key Observations
 City’s Suburban Areas - limited remaining large vacant
developable sites for housing development
 While the current suburban development pattern
continues to be focused on separation of housing types,
our lifestyles are changing
 Higher density infill development proposals within
established suburban neighborhoods have been more
controversial and challenging to implement

49. SUBURBAN STRATEGY - Ideas for Action
Modify City codes
to accommodate
multi-generational
housing through
accessory
apartment units

50. SUBURBAN STRATEGY - Ideas for Action
Tool In Focus – Santa Cruz, CA ADU Ordinance/
Program
KEY ELEMENTS
Property owner must live at the same
address as the ADU and only one ADU
per single-family lot is allowed.
Minimum Lot size: 5,000 square feet
Development fees are waived for ADUs
made available for low- and very-low-
income households
Offers discounted loans for conversion
to ADU in return for affordability
covenants

51. SUBURBAN STRATEGY - Ideas for Action
Tool In Focus – Santa Cruz, CA ADU Ordinance/
Program
 Provides guidance on the location and design of accessory
apartment units to promote neighborhood compatibility

52. SUBURBAN STRATEGY - Ideas for Action
 Identify areas for moderate/high density development in
close proximity to major activity centers and connected to
existing transit service
 Consider establishing a land bank for blighted/vacant strip
centers
 Develop an appropriate basket of density bonuses, tax
incentives, development fee reductions, public infrastructure
reductions
improvements

53. SUBURBAN STRATEGY - Ideas for Action
Tool In Focus – Columbia Pike Form-Based Code, Arlington Co, VA
1986 – residents and business
owners formed Columbia Pike
Revitalization Organization (CPRO)
in response to disinvestment in the
area
2002 – developed a redevelopment
plan for the area
2003 – following year, codified the
plan recommendations into a special
district that used form-based code
approach
2003 – code was voluntary, but the
government offered expedited review
and tax increment financing for
projects that used the code

54. SUBURBAN STRATEGY - Ideas for Action
The incentives:
1) Expedited approval process 30-60 days
2) 30 day by-right approval (no public
hearings) for projects under 30,000 sq
ft
3) Eligible for
Tax Increment Public Infrastructure
Fund (TIPIF) – had to be an anchor
development
 a Rehabilitation Tax Exemption, and
 Technology Zone: technology
businesses get 50% reduction in
business license tax for up to 10
years
Since program’s inception, area has seen $500 million in development
including townhomes, several mixed use developments and a new grocery
store

55. SUBURBAN STRATEGY - Ideas for Action
 Create a guide for developing moderate density projects
in established suburban neighborhoods.

56. SUBURBAN STRATEGY - Ideas for Action
 Develop an appropriate public review process for moderate
density infill rezoning requests
KEY ELEMENTS
 Site context analysis
 Meet with Residents
prior to application
submittal
 Elevation drawings

57. Setting a Course for Action…
URBAN STRATEGY

58. URBAN STRATEGY - Key Observations
Opportunities
 Urban areas have the potential to offer the urban
lifestyle sought by Gen Y and some aging boomers
 The addition of more high density housing, particularly
in/near downtown is a critical component to attracting
more retail and other attractions to the downtown area
 Urban areas generally have better access to support
services than suburban areas, better connected with
public transportation, making them more suitable for
affordable housing

59. URBAN STRATEGY - Key Observations
Challenges
 Urban areas have a number of vacant properties but
they tend to be scattered, encumbered by brownfield
challenges
 There are limited locations in Chattanooga’s urban areas
that have healthy markets to entice private investment
 Not all urban neighborhoods are the same; each
neighborhood has a unique mix of housing types. Some
neighborhoods have struggled with proliferation of
duplexes, which has fostered a resistance to moderate
duplexes
 Perceptions about crime and under-performing schools
density
can be significant deterrents to forming healthy housing
markets

60. URBAN STRATEGY - Ideas for Action
 Establish a policy for urban neighborhoods that defines
the desired mix of housing types as a guide to inform
future housing development

61. URBAN STRATEGY - Ideas for Action
Strengthen Urban Neighborhoods
 Implement a targeted neighborhood revitalization strategy
that engages public, private and philanthropic sector
 Seek an opportunity to partner with Hamilton County
schools to identify more targeted urban school
 improvement projects City’s Gang Task force initiative
Continue to support the

62. URBAN STRATEGY - Ideas for Action
Connecting buyers/renters with urban housing
 Partner with the Realtor community to develop a
marketing/ communications tool
 Recruit major urban employers to provide incentives for
their employees to live in nearby neighborhoods

63. URBAN STRATEGY - Ideas for Action
Cleaning up blight
 Reduce number of highly visible blighted structures:
allocate more resources to Neighborhood Services for
blight removal
2007 Residential Property
Survey
Of 11,965 residential buildings
surveyed in 18 urban City
neighborhoods:
 8,084 are in need of minor or
major repairs
135 dilapidated buildings
appearing to be unfit for human
habitation.

64. URBAN STRATEGY - Ideas for Action
Targeted redevelopment – informed by a building-form revitalization plan,
specific housing outcomes, implemented through public-private
partnerships
 Formalize an urban land banking and redevelopment
SOUTHSIDE/ COW ART PLACE
program that assembles distressed properties, and
incorporates financial incentives for their redevelopment
 Target locations for higher density, mixed income housing
along established key transit corridors, and in close
proximity to downtown UTC SOUTH CAMPUS
UTC SOUTH CAMPUS

65. Setting a Course for Action…
AFFORDABLE HOUSING
STRATEGY

66. AFFORDABLE HOUSING STRATEGY
Key Observations
 There is a growing need for affordable housing among low and moderate
income households
 Gen Y, the largest demographic will need both affordable rentals and
reasonably priced first time homes
 Some development requirements and fees (permitting, sewer tap,
infrastructure repairs) contribute to the added cost of housing
 There is a resistance to affordable housing, particularly for low-income
households, in established neighborhoods
 There are a significant number of existing homes in urban areas that are
low priced, but need substantial rehab
 There are very few locally based affordable rental housing
builders/managers, particularly at any large scale

67. AFFORDABLE HOUSING STRATEGY - Ideas for Action
 Propose definition
of “affordable and
livable housing”
 Establish a
baseline and set
specific targets
 Adopt a City Policy
that supports
affordable housing
throughout the City
and endorses a
mixed-income
approach

68. AFFORDABLE HOUSING STRATEGY - Ideas for Action
 Establish an Affordable
Housing Trust
 Establish a home rehab fund
for first time homebuyers

69. AFFORDABLE HOUSING STRATEGY - Ideas for Action
Tool In Focus – Affordable Housing Trust of Columbus/
Franklin County, OH
MISSION: to focus on the facilitation,
production, rehabilitation and
preservation of workforce and low
income housing.
 not-for-profit housing finance
corporation formed in 2001 by the  makes a variety of loans
City of Columbus and Franklin to private and non-profit
County developers to finance
acquisition, construction
and bridge loans
 provides technical help
and pre-development
research to mitigate
financial risk

70. AFFORDABLE HOUSING STRATEGY - Ideas for Action
Tool In Focus – Affordable Housing Trust of Columbus/
Franklin County, OH
IMPAC
TSince inception, facilitated the creation
or preservation of over 6,000 housing
units in Columbus and Franklin
County.
 In 2011, made new loan commitments
totaling over 6.75 million dollars,
dollars
which will help to finance more than
523 new or rehabilitated housing units
 In 2012, provided $1 million
construction loan for 100-unit
permanent supportive housing
initiative targeted for formerly
homeless individuals and low
income individuals

71. AFFORDABLE HOUSING STRATEGY - Ideas for Action
Public Policy
 Introduce a portfolio of incentives such as fee
reductions and density bonuses for housing
developments that include affordable units
 Projects over a certain size that do not incorporate
affordable housing would pay a fee into a housing trust
fund that would support affordable housing efforts
 Develop local public and non-profit capacity to build
and manage affordable rental housing

72. Setting a Course for Action…
ALIGNING CODES/
POLICIES
STRATEGY

73. ALIGN CODES/
POLICIES STRATEGY - Key Observation
 Most of the remaining
undeveloped sites in
Chattanooga are small and
have environmental
constraints
 Current zoning
standards/code requirements
limit the ability of developers
to mix housing types and
build more compactly

74. ALIGN CODES/
POLICIES STRATEGY - Ideas for Action
 Offer reduced/eliminated fees, streamlined review, density
fees
bonuses for projects that incorporate affordable housing in
targeted policy areas
 Review subdivision code and street standards to
eliminate site engineering requirements that
unnecessarily impact cost of housing and the “footprint”
of disturbed site area (street widths, turn-around design,
grading, minimum lot size, swales vs. curb)

75. ALIGN CODES/
POLICIES STRATEGY - Ideas for Action
 Update zoning codes to allow more diversity in range
of housing types and lot sizes
 For targeted areas, develop an infill development loan
fund/public capital institution
 Set up a vacant lot “clearinghouse” database
Co-Housing Live-Work Housing Units

76. WRAP-UP KEY POINTS
 Clearly define the desired housing outcomes and how
they will be measured
 Implement strategies based on place AND
neighborhood context, preferably in the context of a
specific revitalization plan
 Combination of design controls and financial
incentives are key to successful outcomes
 Codes/standards should accommodate more
diversity of housing and street types to provide
more flexibility in meeting changing demand

77. PANEL FEEDBACK/DISCUSSION

78. http://www.chcrpa.org/housingstudy.h
tm
THANK YOU.