Demand - Demand for Housing 2008 Page 1 Demand for Housing...

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Demand for Housing 2008 Page 1 Demand for Housing The fundamental unit for determining housing demand is the rate of household formation. Projecting household formations and, therefore, the projected demand for housing in a given area requires collecting data on the projected number of households by income, household size, and age of householder. Other quantitative data to be collected for affordable housing development includes age of housing stock, number of substandard housing units, and number of households paying more than 30% of income for rent or owner costs. Projecting future numbers of households may be calculated as: HH = Hs(Population change) + Current Population(Change in Hs ) where Hs = Headship Rate = the rate at which the population forms households HH = Households The causes of changes in household (HH) formation rate include: population growth aging children leaving family home changes in income housing prices divorce rate singles forming households References: See issues of Housing Economics or American Demographics for discussion of demographic trends. Several articles address underlying factors including by Myers and Hughes. Sources of data for projected housing demand include: Housing Element of Comprehensive Plan (Growth Management Dept.) Updates to Comprehensive Plan called Evaluation & Appraisal Report (EAR) State Housing Initiatives Partnership (SHIP) plans Florida Housing Finance Corporation market studies The US Census collects much valuable data but it is available at the national, regional, and state level. Some data are available at the county and metropolitan statistical area (MSA) level. In Florida, the Shimberg Center for Affordable Housing at the University of Florida produces an Affordable Housing Needs Assessment for every jurisdiction in the state. This report projects housing need for every city and county. Use the Internet to visit the website at
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Demand for Housing 2008 Page 2 MARKET SEGMENTATION So you are a home builder in a new market but you want to get to work. What are you going to build? How expensive should it be? Where should you buy land on which to build? Brick, block, wood-frame, or ICF? Two-, three-, or four-bedrooms? These are just a few of the questions you need to answer before tying up a large part of the capital to which you have access. The marketing community thinks in terms of dividing the market into pieces or segments with sufficiently different characteristics to cause the advertising for that segment to differ from other market segments. Marketing people argue that knowing the characteristics of a specific market segment that you have targeted gives you the ability to do a better job of marketing to them. What makes your business unique? and
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This note was uploaded on 08/27/2011 for the course BCN 4023 taught by Professor Stroh during the Spring '11 term at University of Florida.

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Demand - Demand for Housing 2008 Page 1 Demand for Housing...

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