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HPSTF Meeting 2 Agenda & Packet Materials p� 10r� PLANNING AND BUILDING SERVICES V O :111111111PREGO� March 17, 2023 Re: Housing Production Strategy Task Force Meeting#2 Dear Housing Production Strategy Task Force Member, Please find the following materials in advance of the second meeting of the Housing Production Strategy Task Force (HPS Task Force), scheduled for March 24, 2023 at 1:00 PM: • HPS Task Force Meeting#2 Agenda • HPS Task Force Approved Charter& Bylaws • Council Report& Resolution 23-06-Approving Appointment to the Housing Task Force • Draft Minutes- HPS Task Force Meeting#1, 12/16/2022 • Buildable Lands Inventory and Housing Capacity Analysis Cover Memo • Draft Residential Buildable Lands Inventory • Draft Housing Capacity Analysis(to be distributed Monday, 3/20) To help make our time together as productive as possible, please review these materials, in addition to the other background on the City's project page, before the meeting. Feel free to contact me with any questions or concerns. Sincerely, Erik Olson Long Range Planning Manager City of Lake Oswego Community Development Department 503.635.0290 380 A Avenue PO BOX 369 Lake Oswego, OR 97034 www.ci.oswego.or.us (l� s Housing Production Strategy Task Force Meeting #2 — March 24, 2023 @ 1:00 PM C..) O Hosted via Zoom oREoor' PUBLIC VIEWING & COMMENTS Members of the public can use the following URL link to register in advance to view the meeting: https://us06web.zoom.us/webinar/register/WN pOiuhXVtQ2OLYnubnho2-A. Members of the public who wish to send comments regarding issues being addressed by the Lake Oswego Housing Production Strategy Task Force ("HPS Task Force") are requested to email their comments to LO-Housing@lakeoswego.city with "HPS Task Force" in the subject line. MEETING PURPOSE Review and provide input on the Draft Housing Capacity Analysis and Draft Residential Buildable Lands Inventory. AGENDA 1. Introductions (all) 5 mins 2. Minutes - HPS Task Force Meeting#1, 12/16/2022 (all) 5 mins 3. Announcements (Erik Olson, Long Range Planning Manager) 10 mins 4. Review Draft Housing Capacity Analysis (Brendan Buckley, Johnson Economics) 45 mins, including questions and comments 5. Review Draft Residential Land Needs Analysis (Matt Hastie and Andrew Parish, MIG) 45 mins, including questions and comments 6. Next Steps (Erik Olson, Long Range Planning Manager) HPS Task Force Meeting#2 Agenda Page 1 of 1 Housing Production Strategy Task Force (\-1,.<„Crirr4_ A Ad Hoc Task Force Charge Statement & Bylaws Approved - December 16, 2022 V O ollow TASK FORCE CHARGE OR o or' See Resolution 22-30, attached. TASK FORCE COMPOSITION The Housing Production Strategy Task Force consists of the members appointed by City Council in Attachment 1 to Resolution 22-30, pursuant to Resolution 22-30 (Resolution attached). A Task Force Chair and Vice Chair will be selected by the group. Given the limited timeframe of the Task Force's work, in the event that a member cannot serve out the term of this appointment or fulfill their responsibilities, no alternate will be chosen to fill the vacancy unless directed by the City Council. Any member who has two unexcused consecutive absences is automatically removed from the Task Force, and new members will not be appointed to fill their positions. MEMBER RESPONSIBILITY The Housing Production Strategy Task Force will be making recommendations to City Council that will also serve as guidance to the Planning Commission, as provided in Resolution 22-30.The Task Force is expected to: • Review the Lake Oswego Neighborhood Character Report (2021), the Middle Housing Opportunities Report (2021), the Middle Housing Code Advisory Committee (MHCAC) Key Issues Summary Memo (2021), and the City's Comprehensive Plan — including the 2013 Housing Needs Analysis and Economic Opportunities Analysis. • Review documents produced by the Oregon Department of Land Conservation and Development (DLCD) relevant to housing needs and production, including: the Oregon Administrative Rules for House Bill 2003 (OAR 660-008-0045 through -0070); the List of Tools, Actions, and Policies for the Housing Production Strategy Program; the Anti-Displacement and Gentrification Toolkit; and other information and resources available through DLCD's Housing Needs website. • Come to meetings prepared to give thoughtful input. • Listen carefully and with an open mind; respect one another and City staff, and accept differences of opinion with a goal of understanding the interests of all members. ▪ Ask questions and make informed recommendations to advance the project forward. Housing Production Strategy Task Force Charge Statement and Bylaws Page 1 of 6 ' Review and comment on materials provided for each Task Force meeting. Make recommendations at key junctures throughout the process. ' Strive for reaching consensus among the Task Force based on support for proposals as a whole. ' Assist in informing the community about state requirements under House Bill 2003 (HB 2003), which include an update to the City's Housing Needs Analysis and the development of a new Housing Production Strategy to address the City's housing needs. ' Solicit input from and represent their stakeholder groups as appropriate. PROJECT STAFF RESPONSIBILITY City staff and project consultants will do the following to support the Housing Production Strategy Task Force process: • Support the Task Force Chair in facilitating a transparent and inclusive process where all participants are heard. ■ Provide the Task Force with relevant, factual information in a timely manner and readily understandable format to facilitate decision-making. ■ Prepare meeting agendas in consultation with the Task Force chair, and prepare meeting summaries that focus on discussion topics and key agreements. ■ Maintain a project web page and central file repository where the Task Force and public can access all meeting materials and key work products. ■ Provide opportunities for the public to provide input, and make public comments available to the Task Force, decision-makers and public. ■ Be accessible and responsive to questions and ideas from the Task Force. QUORUMS AND DECISIONS At its first meeting, the Task Force shall elect a Chair and Vice Chair, as provided in LOC 12.50.025. The Task Force shall follow all provisions of LOC Article 12.50 that apply to ad hoc committees, except that, instead of requiring a simple majority of the members present and eligible to vote to decide any question [LOC 12.50.030(2)), a vote by two-thirds of the members present and eligible to vote will be required to approve a policy recommendation. Members shall strive for consensus and may use straw poll, interactive/instant polling, or consensus voting procedures to gauge members' opinions. For controversial issues,the Task Force may include a minority opinion with the majority recommendation. Where the Task Force does not reach consensus on a particular issue a roll-call vote shall be taken. Housing Production Strategy Task Force Charge Statement and Bylaws Page 2 of 6 TIMEFRAME Pursuant to Resolution 22-30, attached, the Task Force is tasked with: • Recommending Comprehensive Plan amendments to update the City's Housing Needs Analysis by September 2023, so that the City Council may adopt an HB 2003-compliant Housing Needs Analysis no later than December 2023; and • Evaluating housing production strategy alternatives and producing recommendations by February 2024, so that the City Council may adopt HB 2003-compliant Comprehensive Plan amendments and take other action, as needed,to develop a Housing Production Strategy and Implementation Plan within one-year of the adoption of the updated Housing Needs Analysis. PUBLIC RECORDS Regular meetings of the Task Force will be held by Zoom. All meetings will be subject to the requirements of Oregon Public Meetings Law, ORS 192.610 et seq. All meetings will be recorded and video of the meetings will be posted to the project website for public observation. Housing Production Strategy Task Force Charge Statement and Bylaws Page 3 of 6 HOUSING PRODUCTION STRATEGY TASK FORCE MEETING BYLAWS I. Commitment to Decision-making Process The Ad Hoc Task Force ("Task Force") will endeavor to reach consensus on recommendations to comply with state middle housing requirements. A consensus process will enable the members to freely discuss issues and to arrive at a decision. Consensus is a participatory process whereby, on matters of substance,the members strive for agreements that they can accept, support, live with, or agree not to oppose. Consensus means that no members voiced objection to the position and they agree not to oppose the position. Expectations for the decision-making process include: A. The Task Force agrees that consensus has a high value and that the members should strive to achieve it. B. The commitment to work for consensus means that members will participate in the give-and-take of the process in a way that seeks to understand the interests of all, and will work together to find solutions workable for all. C. When consensus cannot be reached,the facilitator or chair may initiate or entertain a motion to vote on the issue. Members may make motions and seconds. All motions must be seconded to be acted upon. D. Votes shall be taken by all present participating members. A vote by two-thirds of the members present and eligible to vote will be required to approve or advance a policy recommendation. E. If no consensus is reached on an issue or recommendation, minority positions and any alternatives considered will be documented. Those with minority opinions are responsible for proposing alternative solutions or approaches to resolve differences. F. Meetings will be conducted in a manner deemed appropriate by the chair and facilitator to foster collaborative decision-making and consensus building. Robert's Rules of Order will be applied when deemed appropriate by the chair or facilitator. G. Task Force members will honor decisions made, including accurately representing Task Force decisions to the public, and avoid re-opening issues once resolved. H. Task Force members will strive to make decisions within the agreed-to timeframe. Meeting notes will be kept documenting decisions of the Task Force.The Task Force will review, make any corrections to, and then approve the notes. Notes for the final Task Force meeting will be distributed to the Task Force Chair for their approval. Housing Production Strategy Task Force Charge Statement and Bylaws Page 4 of 6 II. Ground Rules for Conduct of the Task Force All participants agree to act in good faith in all aspects of the planning process. This includes being honest and refraining from undertaking any actions that will undermine or threaten this process. It also includes behavior outside of meetings. Expectations for behavior of Ad Hoc Task Force participants—including members and project staff— during and outside of meetings include: A. Participants agree to be respectful at all times of others.They will listen to each other to seek to understand the other's perspective, even if they disagree. One person will speak at a time. Side conversations and other meeting disruptions will be avoided. For virtual/videoconference meetings, members should have both video and audio functions enabled and refrain from private/chat conversations. B. Participants agree to make every effort to bring all aspects of their concerns about these issues into this process to be addressed. C. Participants agree to refrain from personal attacks, intentionally undermining the process, and publicly criticizing or misstating the positions taken by any other participants during the process. Participants shall maintain a "safe" space for Task Force proceedings, where there is permission to constructively and respectfully express all perspectives, including unique or opposing viewpoints, without fear of being met with criticism or recrimination. D. Any written communications, including e-mails, blogs and other social networking media, will be mindful of these procedural ground rules and will maintain a respectful tone even if highlighting different perspectives. Members are reminded that any City government e-mail, blog and other social networking media is considered public record. E. Non-members upon registering with City staff may attend virtual/videoconference Ad Hoc Task Force meetings.The public may also submit written comments for distribution to the Ad Hoc Task Force, but may not otherwise participate in the Task Force deliberations. F. Requests for information made outside of meetings will be directed to the City staff. Responses to such requests will be limited to items that can reasonably be provided within a reasonable amount of time. G. All participation in this process is voluntary. A member may withdraw by submitting a written withdrawal request to the Task Force Chair or City staff project manager. However, members agree that before withdrawing they will discuss the reason for their withdrawal with the Chair or City staff and will give the Task Force the opportunity to understand the reasons for withdrawal and to encourage continued participation, if appropriate. Housing Production Strategy Task Force Charge Statement and Bylaws Page 5 of 6 ATTACHMENTS Council Resolution 22-30, Creation of Ad Hoc Housing Production Strategy Task Force (incl.Attachment 1) Housing Production Strategy Task Force Charge Statement and Bylaws Page 6 of 6 8.2 � cis COUNCIL REPORT � D „mow \9REGO Subject: Resolution 23-06, Housing Production Strategy Task Force (House Bill 2003) PP 22-0005 Meeting Date: February 7, 2023 Staff Member: Erik Olson, Long Range Planning Manager Report Date: January 30, 2023 Department: Community Development Action Required Advisory Board/Commission Recommendation ❑ Motion ❑X Approval ❑ Public Hearing ❑ Denial ❑ Ordinance ❑ None Forwarded ❑X Resolution ❑ Not Applicable ❑ Information Only Comments: At their meeting on October 4, 2022, the City Council adopted Resolution 22-30 appointing ❑ Council Direction members to an Ad-Hoc Housing Production Strategy ❑X Consent Agenda (HPS) Task Force to provide high-level guidance regarding the City's work to comply with House Bill 2003 (HB 2003). Staff Recommendation: Adopt Resolution 23-06 to add Kimvi To as a member of the HPS Task Force, serving as a liaison from the Diversity, Equity, and Inclusion (DEI) Board. Recommended Language for Motion: Move to adopt Resolution 23-06. [Note: only Councilors vote to concur in Mayor's appointment of Committee members, per Charter, Sec. 19.] Project/ Issue Relates To: Council Initiative to "Complete work on key housing initiatives, including... HB 2003 compliance..." Issue before Council (Highlight Policy Question): Addition of a liaison from the DEI Board as a member of the Ad-Hoc HPS Task Force, which is meant to help inform the City's process to update the Housing Needs Analysis and develop a Housing Production Strategy in order to comply with state requirements under HB 2003. ❑X Council Goals/Priorities EAdopted Master Plan(s) ❑Not Applicable ATTACHMENTS 1. Resolution 23-06 Respect. Excellence. Trust. Service. 503-635-0215 380 A AVENUE PO BOX 369 LAKE OSWEGO,OR 97034 WWW.LAKEOSWEGO.CITY RESOLUTION 23-06 A RESOLUTION OF THE CITY COUNCILORS OF THE CITY OF LAKE OSWEGO ADDING KIMVI TO AS A MEMBER OF THE AD HOC HOUSING PRODUCTION STRATEGY TASK FORCE. WHEREAS, the Lake Oswego City Council has adopted Resolution 22-30 approving appointments to the Ad Hoc Housing Production Strategy Task Force (the "Task Force"); and WHEREAS, an individual on the City's Diversity, Equity, and Inclusion (DEI) Board, Pat Ginn, was appointed to the Task Force, but not as a liaison from the DEI Board; WHEREAS, representatives from the DEI Board have since requested that an official liaison, DEI Board Co-Chair Kimvi To, be appointed to the Task Force; WHEREAS, at their meeting on December 16, 2022, the Task Force recommended the appointment of an additional member, Kimvi To, to the Task Force as a liaison from the DEI Board; BE IT RESOLVED by the Lake Oswego City Council that: Section 1. Kimvi To is appointed to the Committee to serve as the Diversity, Equity, and Inclusion Board Liaison. Section 2. This Resolution shall be effective immediately upon its adoption by the City Council. Adopted by City Councilors at the meeting of the Lake Oswego City Council held on the 7th day of February 2023. AYES: Councilors Mboup, Verdick, Rapf, Afghan, Corrigan, Wendland NOES: None EXCUSED: None ABSTAIN: None Joseph M. Buck, Mayor ATTEST: %/1 Kari Linde , City Recorder APPROVED AS TO FORM: Ellen Osoinach, City Attorney Resolution 23-06 Page 1 of 1 DRAFTED: 12/21/2022 F p CITY OF LAKE OSWEGO Housing Production Strategy Task Force mmi 'O Meeting #1 Action Minutes December 16, 2022 GREGON. 1 2 1. CALL TO ORDER 3 Erik Olson, Long Range Planning Manager, called the meeting to order at approximately 12:30 4 p.m. This was a video conference meeting held via Zoom. 5 6 ROLL CALL 7 Members Present 8 Boards and Commissions: Joseph M. Buck, Mayor and City Council Liaison; Douglas Corder, 50+ 9 Advisory Board Representative; Bruce Poinsette, Development Review Commission 10 Representative; and Kasey Adler,Transportation Advisory Board Representative. 11 12 At-Large Members: Sarah Walker, David Tangvald, Phil Bertrand, Yoko Kinoshita, Cara Kao- 13 Young, Rebecca Lane,John E. Pauley, Rosalie Nowalk, Pat Ginn, Diana Howell*, and John Turchi. 14 * Joined Zoom meeting via telephone. 15 16 Committee Members Absent: Philip Stewart, Planning Commission Liaison; Kyrsten Baumgart 17 and, Betty Jung, At-Large Members. 18 19 Staff Present: Erik Olson, Long Range Planning Manager; and Cristina Siquina Calderon, 20 Administrative Support. 21 22 Consultants Present: Andrew Parish, Senior Planner with MIG; Matt Hastie, Project Manager 23 with MIG; and Brendan Buckley, Project Manager with Johnson Economics. 24 25 Members of the Public Present: Kimvi To, DEI (Diversity, Equity, and Inclusion) Advisory Board 26 Member. 27 28 2. WELCOME AND INTRODUCTIONS 29 The Housing Production Strategy Task Force (HPSTF) members and staff introduced themselves 30 to each other with their names, professional affiliations, and interest in the task force. 31 32 33 34 (CONTINUED ON NEXT PAGE) Respect. I:x::el er•:.c:. Trust. .,..' 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO, OR 97034 WWW.LAKEOSWEGO.CITY DRAFTED: 12/21/2022 1 3. PROJECT OVERVIEW, REVIEW OF COMMITTEE, AND WORK PLAN 2 3.1 Overview of House Bill 2003 3 Members received a brief presentation outlining the background of House Bill 2003. 4 Andrew Parish, Matt Hastie, and Brendan Buckley, Project Consultants. 5 6 Work Plan 7 Members reviewed the projected outline of the proposed Work Plan, then opened the floor for 8 questions and group discussion. Erik Olson, Long Range Planning Manager 9 10 Election of Chair and Vice Chair 11 Members discussed the roles, responsibilities, and expectations of the Chair and Vice Chair, 12 followed by an election. 13 14 Member Kasey Adler moved to elect Sarah Walker as Chair and John Turchi as Vice Chair. 15 Rebecca Lane seconded the motion and it passed unanimously 14:0. 16 17 3.2 Adoption of By-Laws 18 Chair Sarah Walker opened the floor for discussion. 19 20 Kasey Adler moved to adopt by-laws as drafted. Vice Chair John Turchi seconded the motion 21 and it passed unanimously 14:0. 22 23 Input/Action Items: 24 • Staff was asked to provide a summary of development happening throughout the city at the 25 next meeting. 26 27 4. SCHEDULE REVIEW 28 4.1 Establish a Day/Time for Future Meetings 29 Erik Olson reviewed the tentative meeting dates with a possibility of adding more as needed. 30 31 5. ADJOURNMENT 32 There being no further business, the meeting was adjourned at 02:15 p.m. 33 34 35 36 37 38 Respectfully submitted, 39 40 41( r 41 Cristina Siquina Calderon Respect. I:x::el er•:.c:. Trust. .,..' 503-635-0290 380 A AVENUE PO BOX 369 LAKE OSWEGO, OR 97034 WWW.LAKEOSWEGO.CITY Lake Oswego Housing Needs Analysis March 17, 2023 LAKE OSWEGO HOUSING NEEDS ANALYSIS Buildable Lands Inventory and Housing Capacity Analysis I March 17, 2023 Introduction This memorandum briefly describes the purpose and methodology behind two components of the City of Lake Oswego's Housing Needs Analysis(HNA):the Buildable Lands Inventory (BLI) and Housing Capacity Analysis (HCA). Initial drafts of these memos have been provided to the City's Housing Task Force for review and comments. Buildable Lands Inventory The purpose of the BLI is to identify land that can be expected to provide residential capacity for the City of Lake Oswego in the next 20 years. Its general steps are: • 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 homeowners association) or religious/fraternal ownership is generally not considered available for residential uses. • 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. • 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. • 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. This initial inventory is a work in process—it will be refined with feedback from the Housing Task Force and other stakeholders. Next steps also include further analysis on the topics of redevelopment in the City's commercial and mixed-use zones, as well as an estimate of the future housing mix of available residential land. Cover Memorandum—Draft BLI and Draft HCA Page 1 Lake Oswego Housing Needs Analysis March 17, 2023 Housing Capacity Analysis This analysis outlines 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 • Claritasl • 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. • Current housing conditions, including housing tenure (rental/ownership), age of housing stock, unit types, and assisted housing. • An assessment of current housing demand, based on population characteristics and the availability of housing units. • An assessment of future housing need, based on forecasted population growth and a variety of other anticipated demographic and housing market trends. Next Steps: Comparing Residential Land Supply and Future Need After receiving feedback on the BLI and the HCA,the next step for the project team is 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.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. 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. Cover Memorandum—Draft BLI and Draft HCA Page 2 Lake Oswego Housing Needs Analysis March 17, 2023 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 DRAFT Buildable Lands Inventory Methodology Page 1 Lake Oswego Housing Needs Analysis March 17, 2023 Figure 1.Study Area Map s . 1RW5TEF1ENSUNST S' x 1;;' PD �Ff. 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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. DRAFT Buildable Lands Inventory Methodology Page 2 Lake Oswego Housing Needs Analysis March 17, 2023 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 DRAFT Buildable Lands Inventory Methodology Page 3 Lake Oswego Housing Needs Analysis March 17, 2023 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) DRAFT Buildable Lands Inventory Methodology Page 4 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 5 Lake Oswego Housing Needs Analysis March 17, 2023 Figure 2. City of Lake Oswego Zoning Designations 1 POnlantl in Community ti ,+ 224 ttil College--sylva Tryon Creek v ' Scare Natural i S 2 Elake J_ E I r q 3,, V �,I,' I --— Milwaukie I [ -qr . _ Helg hts Tigard .:r oar r��1x 'i 1/41 'F, s (1 .," N R-5 414 ..1, '. Pr- s R-6 U6. Oak Grove /LeR-ao vo. di P.ci� A. ' E 1011 Bonita • �� ��� r �' SW 6a'ntd Rd Ill', ' ��� r 04144)NW . ..mi • 441177 ilt E,- .7.s..s., I. i y�� SW Durham RA �*;0; Rio � R.y s ' _r r 'G Concord f. R•7.5 ♦ \ gl. TraueyTrail Took Park :_+4 �ji Durham _ R,1e 765�r JalatiD r ■ e Er.. ery Club rwl• 44 R-. Esri,NASA,NG USGS,FEMA,Oregon Metro,Oregon State Parks,State of Oregon GEO,Esri.HOSE, Tualatin Rlvergrove _PNA�� A,Gamin,SafeSraph,GeTechnologies,Inc,METIINASA.USC5,Bureau of Land Management,EPA,NPS. I L. USDA Mary S.Young Lake Oswego- Buildable Lands Inventory-Zoning Districts Legend 0 Lake Oswego =AL PF =R.6 LAYER 0 I PNA 0 R-7.5 ▪CI ®IP i R-0 ©R•DO MI Cl/OC 0MC A-lD ®kW =I CR&D 0 NC _R-15 =WLGOC M EC =NCfR-0 R-2 i=WLG R-2.5 =EC/R-0 =DC =R-3 II NILS RMU 0 0.25 0.5 1 O Sc 0 cgfR-rI 0 R-5 1 = Miles DRAFT Buildable Lands Inventory Methodology Page 6 Lake Oswego Housing Needs Analysis March 17, 2023 Figure 3. City of Lake Oswego Comprehensive Plan Designations PortlandVWiii p i Crill -22a omune y '' I ) CORZme Sylva Tryon Creek _ i• Y Slate Natural iJ . illili is. SP -" R-3 :1 141 rf t ` i' 7.L - 0 Milwaukie j "I-, 1 It-�o.♦ Heights Tigard rr °°� �o 4K I Ell �#; �� ��. k ry e.111 1 F ►�' . R-E d Oak Grave 1� �r� §f rk Bonita SW He ne ridI1/1p1;: SW❑urharn Rd R-7.5 di .2 I.0 Concord R i5 I Cl _aok Park i : "AA ? Trolley Trail Durham Rno Pf� iR-i° 4• alatln •ao440111 •[ R �� n ry Club -as I t � L r Jer -� fta5 Esri,NASA,NGA,USGS,FEMA,Oregon Metro,Oregon state Parks,State of Oregon GEO,Esri,HERE, Tualatin I Riverg rove BR[rain.SafeGraph,Ggatechnalogies,Inc,METIINASA.USGS,Bureau of Land Management,EPA,NPS, USDA c' Mary S.You ng. Lake Oswego- Buildable Lands Inventory-Comprehensive Plan Designations legend 0 Lake Oswego 0 HE 0 PH4 O R•7.5 LAYER 0 IP =R-0 l R-W CI 0 MC 0 R-10 Mg SP CRe) 0 NC =R-15 ©WLG OC ®EC l=NC/R-o I=R-2 I l WLG R-2.5 MI EC(R-o 0 OC O R-3 0 WLG RMU E]Ftau C]oc/R-3 CI R-5 =I<all other values, 0 0.25 0.5 1 Oc,C OPF IIR-g 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. DRAFT Buildable Lands Inventory Methodology Page 7 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 8 Lake Oswego Housing Needs Analysis March 17, 2023 Figure 4.BLI Land Classification I r_.1�� ®Study Area :+ ;.`l �„�� ,J'l�� � = Lake Oswego City MN. Ate "'�r'It r - - - Limits UM.iif ,ii+ric- .,. ;; ,;; �� i Land Type 11,.46 :-j ,,N, -p�-,.�,, �Z y�2 1�� i Residential .10 ... . , f�;r..�1 ,lE L,. �i ■ mil �" i17 ` . Mixed Use �' -�( >-_t10-,--'��._17 �►V� J �. I�� Public/Other L I iI -�_ � * Ir/11 NonResidenal inic A y i 1-icE % yhl� lliilllllin r.: rig Ja ,s 'P , 11111r t , dd I 111111....-111,41D.&101 44101111;"4",,j4,,,.,.--'••• ,,,,41.';'.!."..,r.b7 *.iir. '`' -' . ' �fi iTr-----4\a- im .6,. l.: r �� TV v Or- ems,✓t•+r ; I. alag row' Ot.,,Proilme::" 4 I I I 4 I&in in A il:" '4. iimmuksir,„,.:10,ferlit 01(117,_,v,L,c, ro ISEVirgi ilikk 16.:utoury.,pave,,L,...-.4,,,f4, ofeemite.tir..._vp.r=s-LAL , _.# -, . arA&J=F Dv iriairri= _ MM. ,- I; %illiffilri J...,7-11. gra 4•11.5,-* [l,s1 PI O I \ 1 iviern maireajarii 14 L .milli, /--' - }VV."' V' •44, 4thigrapiAgii-,;� IJ ri llllllllll�y' FLA jir awl 0 4 Pr-' , E\ (INw w gro I�=i 1011.... � �i� v Z i o) ter. �--�� ram- I 1 IMiles-- - ' \ OREOOc� '7 0 0.25 0.5 1 . Lake Oswego Buildable Lands Inventory I Land Type Prepared by © I3 0 DRAFT Buildable Lands Inventory Methodology Page 9 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 10 Lake Oswego Housing Needs Analysis March 17, 2023 Figure 5. Constraints to Development k )Study Area SW STEPHENSON ST `,,9 ND Lake Oswego City ¶ q y M S aP wY ER N Limits �SFR o =� K goo o Major Roads 5� 1_ o_ _� Taxlots °1 j J.Sf Greenway Mgmt. h �', Overlay District MELROSEST �? ti Slopes>25% o Couv2Ry�UeRoa 7�do FEMA Floodplain �2, f y 4 Sensitive Lands Overlay �/ Q Habitat Benefit Areas -��. KNUSE_WAY 0,,,'.-1"` S A AVE 141,40 SW BONITA RD, ,—• p, a° z o� ouNrA N ervo Resource i Fl o 5> Conservation Areas cJ Resource Protection 1 [1 oR �E`N gw D EC '1 P' b, [ j 05sC>5VC5 SHORE Bw ` Areas(RP) 1 0 YYYLLL����F�F p GREENTREE R' \o LFR� 1 ao o i. E� o EC I r `^ P,OOKO 5 BERG15:R0 2- 0 1 / '� 3 OAF 9 E y z 0 EE 17 CHIIosRDm 3 vosRbya4 1 A5r404 oii » vo:/s 9 —I l_: Miles a-' I YI� _ �s___ 'i �^J 0 D.25 0 F 5 1 11H^ '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 DRAFT Buildable Lands Inventory Methodology Page 11 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 12 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 13 Lake Oswego Housing Needs Analysis March 17, 2023 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 `Nsv t */ s .L,K, ,_ ®Study Area 3 i a� y Deveopment Status Developed _ a P �5�, 1 'irii- • I Partially Vacant � J� ':A�t ) Vacant • 117 -' \ ‘ -MELROSE ST I - - ! �`1REJY e f ,,�Q 60U Tq,Qua RD .rani ,1'0"MA 7`'.! C'r �Qe �`~� g�j F ,�1 __ - - 9d,..4,11. , .5 : AEPaMB D �� . 00 ~ , z ' � �//SW BONITA RD SAP QG ICI` BLV,D� �TYw - \ > • "APO IR 1, / •,,, 1 ,„ 2 If ,, 1J Jul o F.Q'OR\E�•RLVD, I 4-..--- vE PNE rl \1 i1 ^�PKE .4 ,tkORf?irc, MC� •♦♦ }� J �H , ♦!_ a r GREEN�T1.R�EE RD �� / M0P .FRq ` IL jaw r vE�`irlOOK�RI .._ S BERGIS.RD - F' glii 4 v .. a; ; � -1_ mil.. ♦ O / / s ' _ 1��1; SH I L D S RD 'I�,d % c,,Z,\.0 .�,� • � /0 , . . I.. n• _. . we'- ''"II ' ORE GO/ /N 0 0.25_ 0.5 1 ..�.Iffihb �/ fir •a �1 64 I- 'iP• ` Lake Oswego Buildable Lands Inventory I Development Status Prepared by IM 0 0 DRAFT Buildable Lands Inventory Methodology Page 14 Lake Oswego Housing Needs Analysis March 17, 2023 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 DRAFT Buildable Lands Inventory Methodology Page 15 Lake Oswego Housing Needs Analysis March 17, 2023 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) DRAFT Buildable Lands Inventory Methodology Page 16 Lake Oswego Housing Needs Analysis March 17, 2023 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 DRAFT Buildable Lands Inventory Methodology Page 17 Lake Oswego Housing Needs Analysis March 17, 2023 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. DRAFT Buildable Lands Inventory Methodology Page 18 DRAFT ..:'.. - 411 _AIL I 0 f . : I ' l - 7. il t o • .L.,:,.,.: I I ! 5 .ice 1 "I Itflu1Riiii11 .. 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 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 TABLE OF CONTENTS I. INTRODUCTION 3 II. CITY OF LAKE OSWEGO DEMOGRAPHIC PROFILE 4 A. POPULATION GROWTH 5 8. 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 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. 1 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 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-yearACS 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 • 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 o Renter 6-person 1% Owner 2% 5-person 3% 4% in 4-person 110/ 18 = 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 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 300 250 200 150 100 _ 11 ■ I III 50 ' ' 0 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 FIGURE 2.4: AGE COHORT TRENDS,2000-2021 25% Lake Oswego(2000) N N (NILake Oswego(2021) 20% 0 0 w ti c' 0 Clack.Co.(2021) 1 0 0Tr 0 15% 0 `--1 m a 0 0 ,m-1 ti 0 0 0 0 ti 0 0 0 1 o ti 0 ti 10% 4 " 0 0 5% o NIN c-1 0% yh�eat5 ���aie ���eat5 ���at5 ���eat5 ����aie ���eat5 ��a�acy ��``x a aec �o �o co �o so ,`o ,`o 3 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 Over65 Years 40% 40% 31% 31% 30% 28% 30% 21% 200/ 20% =I18% 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 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 $10ok 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 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 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 ,t+, Milwaukie Hosp 0 Li von Creek State© a3 Mllwaukle ® M Natural Area , Duntho pe • - rti '4 99E 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 Landi1-4-- -\,____) . :. ng Durham A1 ""1 _ . ' ritage Center 90% / 10% 12% 88% Jennii Lr 1 MARYLHI'F—I River Grove.` ualatin © Stafford • Leci,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 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 FIGURE 3.2: NUMBER OF BEDROOMS FOR OWNER AND RENTER UNITS,2021(LAKE OSWEGO) Number of Bedrooms 5 or more 1% Renter 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 FIGURE 3.4: CURRENT INVENTORY BY UNIT TYPE,BY SHARE Lake Oswego, Oregon 100% 81% Owner 80% Rental 59% 60% - 0 co 40% 20% 18% 0 13% 1- 6% 0% 5% 3% 6% 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% I° 10% 10% •° • 1 1 1 7% 7% 5% 5% 5% 5% 1 1 1 3% IN 3% 1% 0% OS 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 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% c 80% 74% Renter Households 64% n 60% 51% N to 40% = 20% 12% 16% 0 2 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 rent' 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 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% a 25% 22% 0 20% • 15% 14 o 10% 7% t 5% 3% N 0% � ■ 0I0 010 0 ���o ���o L 10 ,t0 �O ,.O Ot C� o\o o\o cAo 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 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. 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 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 (=#of HH) 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 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 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 f1 40% 18% 13% 20% 10! ° 6%- 6/0 0% 5% 3% 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 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 MN 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 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 6,000 •Est.Owner Households c 5,000 Units Valued at Income Level D 4,000 0 v 3,000 0 0 2,000 x I 0 1,000 . . ■ ■ xt 0 000 005 005 �0) 00) 000 0c hc) �c?) OOx hyc�, hLb, hhp, h�0, hAb`, hOo, �, ''IN' yc) , 00, 5rac 000 000 000 000 00 000 000 000 h� tee`' hh h1h h3h hh0 h1,_0. 00% lh' h0' 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 0 E1,500 Units Affordable at Income Level o t 1,000 v 0 = 500 o o . ■ I I Ic,, ,„ Q , o, ., 0,, , il 6 . . li y , w c�, Lp, ., 0, ., 0, Sp, Coy, ,\p', 00, 'Ir' Co, c) 00 4 4 4 h h h ti ti ti O wrac 000 000 000 000. 000 00 tz 00�z 00�z hL h h h c,,7 o, 0, h, 0,e h h z hv h 0 � h hti 4 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 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 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 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 #ofI 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%MFI $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 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%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 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: Detached Attached 2-unit 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: Detached Attached 2-unit 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: Detached Attached 2-unit 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 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 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%MFI <$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 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: '80%MFI 5 $71,600 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