Report: Cedar Rapids housing in flooded areas should outpace the rest

CEDAR RAPIDS - The population in flood-affected areas of Cedar Rapids is expected to grow faster than the rest of the city through 2020, according to a new Cedar Rapids housing study.

A surge in high-density housing near downtown, which sits on the Cedar River, should continue to fuel a projected 9.5 percent population increase, about 113 more residents a year, in flood-affected areas. But housing demand exists across the city - for a variety of housing categories - which is why the rest of the city should see an 8.7 percent increase, or 942 more people a year through 2020.

'This shows with all of the things we have going on we still have a solid demand for a variety of types of housing throughout the community,” said Scott Olson, a Cedar Rapids City Council member and a commercial real estate broker.

Maxfield Research and Consulting, which annually is commissioned to assess housing in Cedar Rapids, released its 113-page report in the fourth quarter of 2016. It is available on the city's website

'Demand for housing remains very strong in Cedar Rapids, and really in our entire region,” said Doug Neumann, interim president of the Cedar Rapids Metro Economic Alliance. 'Market-rate rental units, in particular, are in high demand.”

City staff and the council use the information to identify gaps and help inform decisions, such as what types of development to encourage through tax incentives, Olson said. The private sector also benefits by having the report freely available, Olson said.

Olson plans to present the report to the Economic Alliance downtown housing working group, of which he is co-chairman, at its Jan. 24 meeting.

'That chart is like gold to a housing developer,” Olson said. 'That shows you are building the right stuff.”

The report suggests the market should be able to absorb the 150 new downtown units slated to come on line this year, but the development community will be watching closely how it play out, Olson said.

The report makes specific recommendations for what to build from 2016 to 2020: 200 to 300 market-rate rentals, 205 to 275 shallow and deeply subsidized rentals, 475 to 695 units for senior living, which has seven subsets. For single-family homes, the report recommends 1,920 units by 2025.

Mary C. Bujold, Maxfield president, in a letter accompanying the report, stated her group identified a potential demand for 2,936 new housing units in Cedar Rapids by 2020. An additional 4,651 units are anticipated to be needed between 2020 and 2025, she said.

The majority of the demand is for single-family homes, while only a 'modest” vacancy rate of 2.4 percent exists for rentals, she said. A vacancy rate of 5 percent is seen as healthy because it gives renters options and encourages competition, according to the report.

'Demand is strong, but the inventory is limited,” Erika Kubly, a Cedar Rapids housing and redevelopment analyst, told the City Council development committee while discussing the findings. 'Land prices are increasing, which pushes the price of new construction higher. New development appears to target move-up buyers versus first-time buyers.”

The report states that while Cedar Rapids attracts a 'healthy share” of people in their 20s and 30s, the age demographic of 65 to 74 is the largest in the community and is estimated to have the most growth in the next five years. That growth is pegged at 5,232 people, a 65.1 percent increase.

Scott Overland, a member of the City Council development committee, said senior housing options have expanded rapidly to meet the aging demographic, which could have benefits for the rest of the housing market.

'I think we've seen a lot of demand in senior housing areas, which is also opening up others houses for younger families to pick from,” Overland said.