New Hampshire Housing is a self-supporting public benefit corporation established by the state legislature. We administer a broad range of programs designed to assist low and moderate income persons and families with obtaining decent, safe and affordable housing.

 New Hampshire’s population growth is slowing down, with fewer new migrants  Job growth is slow and job quality is poor  Elders are an increasingly larger share of owners and renters  Young home buyers are challenged by slower economic growth and stricter lending standards  Recent trend away from ownership and towards rental housing  Dichotomy of NH growth means different regions have different problems  General public, town officials and business are not aware of issues affecting NH’s housing Housing Needs in New Hampshire A recently completed three part study of New Hampshire’s housing needs and preferences in light of our changing demographics. Prepared for NHHFA by the New Hampshire Center for Public Policy Studies.

Based on Current Population Projections Growth Remains Slow….

…And We Continue to Age

New Hampshire Job Growth Has Also Slowed Annual job growth in New Hampshire has been less than 1% each year since the end of the recession. By comparison, Massachusetts has grown at about 1.4% in each of the past three years.

The Quality of New Hampshire Employment Has Changed Average annual employment in Manufacturing declined by 35% between 2000 and 2013, while employment in Education and Health Services increased by 28% and Leisure and Hospitality increased by 11%.

In 2005 after more than a decade of economic growth the home ownership rate in New Hampshire had reached a peak of 73%, with renter households making up the remaining 27%. Since then the ownership rate has declined slightly. The Home Ownership Rate in New Hampshire Remains High

The growth in renter households in New Hampshire has been significant in recent years, growing by nearly 13% since 2005, after declining by 5% between 2000 and But, Recent Growth Has Been in Renter Households

65% of households age 35 to 44 are owners, 77% of households 45 to 54 are owners, and more than 80% of households age 55 to 74 are owners. For Households 75 to 84 the percent of owners declines slightly to 77%. But, even for households 85 and over, the ownership rate is 61%. After Age 34 New Hampshire Households Have Predominantly Been Owners, And Will Remain Mostly Owners Into Old Age

Between 2010 and 2025, age 65 and older households, both owners and renters, experience strong growth; but, remain a minority of all households.

Near Future Production Needs Vary Dramatically by County

The number of home sales has slowed seasonally, but total sales for 2013 increased 11.5% from 2012.

New Hampshire Home Prices are Again Showing Signs of Appreciation

Median Purchase Price in 2013 Less Than $100,000 $100,000 to $150,000 $150,000 to $175,000 $175,000 to $200,000 $200,000 to $225,000 More than $225,000 The median purchase price is highest in Rockingham County, and lowest in Coos County. 63 percent of owner occupied housing units in the state are in Hillsborough, Rockingham and Merrimack Counties.

7.5 Mo.

While showing some improvement since the end of the recession, construction activity remains at about 38% of the level a decade ago. New Home Construction Remains Low

New home sales which accounted for as much as 18% of the market in 2004 and 2005, accounted for less than 8% of all sales in 2012 and And New Home Sales Account for Only a Small Portion of All Sales

The number of purchase mortgages in 2013 increased over the prior two years due to improving market conditions and a release of some pent-up demand. With slowly rising interest rates, refinance mortgages have been declining since the 2 nd quarter of Source: Real Data Corp.

Short term Purchase mortgage activity continues to grow especially in the southern tier. Some pent-up demand, and cross border activity has returned. The inventory of good quality homes is already limited in the south. Refinance activity has declined significantly. Mortgage interest rates are at a 40+ year low, but are unlikely to remain there. Mid term Continued growth in purchase mortgage activity will require much stronger job growth and a return of the single family home construction. Refinance activity will continue to decline as interest rates climb toward +/- 6%. Long term Demographics (the aging of the baby boom generation) and economic growth will determine what happens. Mortgage Market

Affordability Since 2009 the monthly PITI for the median priced home has been very close to the median gross rental cost for a three-bedroom unit. However, when the costs of utilities and maintenance are included in ownership, there remains an additional $400 to $500 monthly cost for ownership. For Qualified Buyers it may be a good time to buy.

Income is influenced by other assets and debts. Equity in an existing home, savings, or other family assets can increase affordability. Consumer debt, car loans, student loans and other financial obligations can diminish affordability. Affordability - Price, Income and Mortgage Terms Mortgage credit terms have more influence. Credit score and down payment requirements can influence the interest rate and may make credit unavailable. Mortgage insurance can add to debt and reduce affordability. Other factors also influence affordability. Real Estate Taxes, Hazard Insurance, and Utility costs. Location / transportation or proximity to income.

The cumulative total of foreclosure deeds in 2013 was 26% below the total in 2012, and lower than the total in any year since 2007.

For New Hampshire, New England, and the US this 3 rd quarter delinquency rate decline breaks the typical pattern of 3 rd quarter increases for only the second time in recent years. However, this rate remains stubbornly high.

New Hampshire’s delinquency rate compares favorably with most other New England states.

At the current pace of foreclosure deed recordings, it could take nearly 12 months to clear this inventory, without any new foreclosure initiations.

2 Br $1,076 All $1,018 New Hampshire Housing Annual Rental Cost Survey At $1,076 the stateside 2-bedroom median gross rent remains above the $1,000 mark for the eighth year in a row. 16% increase

Coos $657 Grafton $985 Carroll $964 Merrimack $1064 Cheshire $1039 Hillsborough $1147 Rockingham $1224 Sullivan $925 Belknap $1005 Strafford $981. Monthly Median Gross Rental Cost 2013 Median Monthly Gross Rent For 2-Bedroom Units Less than $800 $800 to $1,000 $1,000 to $1,100 More than $1,100 Rents are highest in the Southern Counties of the state, closest to the Boston labor market. Most of the rental units in the state (73%) are located in Hillsborough, Rockingham, Merrimack and Strafford Counties 2013 Residential Rental Cost Survey Preliminary Results Statewide Median Gross Rent for 2-Bedroom Units - $1,076

What else does New Hampshire Housing do?

Housing counseling and education programs. Fixed-rate mortgage products to participating lenders. A variety of programs to assist low and moderate income buyers. REALTOR® and lender training statewide. Over the last 30 years, we have helped more than 38,000 families to purchase homes, contributing more than $200 million per year to the State’s real estate economy!

Home Flex FHA, VA or RD 0-point Home Flex Plus 0-point with 3% Cash Assistance Home Preferred Conventional loans with low mortgage insurance premiums

FHA 203ks Repairs must add value $35, days for work completion NHHFA disburses NEW disbursement requirements effective with reservations as of 4/1/2014 RD Purchase Rehab Repairs must add value $35, days for work completion NHHFA disburses NEW disbursement requirements effective with reservations as of 4/1/2014 Repairs must meet FHA and RD guidelines and loan amount calculations. Appraisal must be done as if all work completed and the “as is” value must be stated within the appraisal.

The Home Start Homebuyer Tax Credit makes homeownership more affordable for first-time homebuyers. To qualify, eligible homebuyers must receive a Mortgage Credit Certificate (MCC) from New Hampshire Housing. The Homebuyer Tax Credit can decrease the income taxes they owe and boost their take-home pay, which helps qualify for a mortgage and make mortgage payments. The Homebuyer Tax Credit is not a one-time credit – it is an annual credit for the life of the original mortgage, as long as the home is the principal residence.

Example 1.$150,000 mortgage x 5% interest rate = $7,450 paid in annual interest $7,450 x 35% Homebuyer Tax Credit rate =$2,607 $2,000 Maximum annual tax credit Borrower may be able to boost take home pay by $167/month.

Calendar Year 2013 Average family size – 2.3 Average price -$156,400 Average income-$56,000 Average age – 37 years Average credit score – 710 Lending in 131 different towns

Homeownership market is recovering slowly as inventories decrease and the economy continues to improve slowly. The southern part of the state is strongest. Foreclosures are down as the economy and housing market improve. Lenders appear more willing to negotiate short sales. Delinquencies continue to decline but are still historically high. Foreclosures will continue to moderate purchase price increases and add pressure to the rental market.

Rental costs have leveled at a high rate. Vacancies remain low. Some new production in the southern part of the state. A significant portion of rental households are cost burdened. The economy is improving slowly. Slow growth is expected. Demographic shifts will have a more significant impact on the state’s housing market than growth. In the next 10 to 15 years there will be significant need for services and housing to satisfy the down-sizing demand and aging in place.