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08.11.25 - PC Agenda Packet August 11, 2025 — 6:30 PM Council Conference Room 1.Land Acknowledgement We acknowledge and honor the Dakota nation, on whose ancestral land the City of Golden Valley is built, and whose land resources we use. We commit to counteracting the erasure of the cultural practices and presence of the Dakota people through education and by amplifying a wide range of indigenous voices. 2.Discussion Item(s) 2.A.Missing Middle Housing Study 3.Adjourn JOINT WORK SESSION AGENDA Planning Commission and Diversity, Equity, and Inclusion Commission Joint Meeting This joint meting between Planning Commission and Diversity, Equity, and Inclusion (DEI) Commission is being conducted as an in-person meeting. The public may attend and listen to discussion with public participation only allowed by invitation of the respective commissions. City of Golden Valley Joint Work Session August 11, 2025 — 6:30 PM 1 EXECUTIVE SUMMARY Community Development 763-512-2345 / 763-512-2344 (fax) Golden Valley Planning Commission Work Session August 11, 2025 Agenda Item 2.A. Missing Middle Housing Study Prepared By Jacquelyn Kramer, Senior Planner Seth Kaempfer, Equity and Inclusion Manager Summary Golden Valley, like many first-ring suburbs in the Twin Cities region, is facing growing pressure to expand housing options in response to shifting demographics, rising housing costs, and changing household needs. While the city has long been characterized by its predominantly single-family neighborhoods, there is growing recognition that this limited housing mix no longer meets the diverse needs of current and future residents. Younger households, aging residents looking to downsize, and workers seeking to live closer to employment centers all require more varied, flexible, and affordable housing options than what is currently available. "Missing middle housing" refers to a range of multi-unit or clustered housing types—such as duplexes, triplexes, townhomes, and courtyard apartments—that are compatible in scale with single-family neighborhoods but offer greater affordability and choice. These housing types have historically existed in Golden Valley and surrounding communities but have become increasingly rare due to zoning restrictions and development trends. This project explores strategies to reintroduce missing middle housing into Golden Valley’s fabric in a way that supports the city’s goals of strategic redevelopment, local control, and inclusivity. Recommended Action No formal action is requested at this time. Staff requests the Commissions engage in discussion to better understand the scope of the issue. Supporting Documents Housing Market Analysis 2 Demographic Shifts, Housing Market, and Housing Affordability in the City of Golden Valley Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 3 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 2 Key Findings Homebuyers in Golden Valley need incomes 14% higher than the median income in the city and 31% higher than the Metro median income to be able to afford the median priced, for-sale home (Figure 21, Slide 21) “Cost-burdened households” are households that pay more than 30% of their income for housing Almost one in five homeowners (18%) are cost burdened in Golden Valley (Figure 23, Slide 23) Over four of every 10 renters (43%) are cost burdened in Golden Valley (Figure 26, Slide 24) Affordability Owner-occupied, single-family homes still make up the majority of homes in Golden Valley (Figures 9 and 10, Slide 13) Most new development has been larger multifamily projects in the last few years (Figure 13, Slide 15) About 370 units opened in 2023 (Xenia Apartments) and 300 new rental units will be coming online in 2025 (The Winn) The median sale price of a single-family home increased about 22% between 2019 and 2025 (Figure 16, Slide 17) The market-rate rental market has absorbed about 25 units per quarter since 2019 (Figure 20, Slide 19) Housing Market Golden Valley is projected to grow by about 2,000 households between 2020 and 2040, according to the Metropolitan Council (Figure 2, Slide 5) Over the next five years, household growth is projected to occur most in the age 35 to 54 and over age 75 age groups (Figure 3, Slide 6) Millennials will continue to seek affordable owner-occupied housing Baby boomers will be looking for new maintenance-free options Based on shifts and replacement needs, the 2023 Compressive Housing Needs Analysis found demand for between 1,600 and 1,800 units of new housing (Slide 10) Demographic Shifts 4 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 3 Demographic Shifts 5 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 4 Short-Term Projected Population and Household Growth from ESRI Golden Valley has 22,000 people within 10,000 households The population is projected to grow by 0.3% annually between 2025 and 2030 Household growth is projected to be stronger over the same period at 0.7% Reflects a national trend of aging households with fewer members Compared to other areas, this trend is more pronounced in Golden Valley 1 Population and Houshold Growth Census Census Estimate Forecast 2010 2020 2025 2030 2010-2025 2025-2030 City of Golden Valley 20,359 22,552 22,135 22,506 0.6%0.3% Comparison Areas Hennepin County 1,152,439 1,281,565 1,298,422 1,312,783 0.8%0.2% Seven County Metro Area 2,849,565 3,163,104 3,253,299 3,322,753 0.9%0.4% Minneapolis-St. Paul MSA 3,333,633 3,690,261 3,809,346 3,903,629 0.9%0.5% State of Minnesota 5,303,925 5,706,494 5,852,943 5,959,077 0.7%0.4% United States 308,745,538 331,449,281 339,887,819 347,149,422 0.6%0.4% City of Golden Valley 8,810 9,957 10,144 10,492 0.9%0.7% Comparison Areas Hennepin County 475,913 528,547 544,231 555,884 0.9%0.4% Seven County Metro Area 1,117,748 1,239,526 1,288,806 1,325,145 1.0%0.6% Minneapolis-St. Paul MSA 1,293,601 1,434,315 1,498,244 1,546,472 1.0%0.6% State of Minnesota 2,087,227 2,253,990 2,333,970 2,391,162 0.7%0.5% United States 116,716,292 126,817,580 132,422,916 136,716,884 0.8%0.6% Source: US Census Bureau; ESRI; LOCi Consulting LLC Annual Growth Rate Population Households 6 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 5 Long-Term Population, Household, and Employment Projections from Met Council Metropolitan Council has estimates available for projected population, households, and employment, 2020 to 2040 The Met Council projections are higher than ESRI’s projections (Golden Valley: 1,400 new households between 2020 and 2025 versus ESRI’s 535 new households) Household growth is projected to decrease significantly between 2030 and 2040 2 Long-Term Population, Household, and Employment Projections Census Forecast Forecast 2020 2030 2040 2020-2030 2030-2040 Population Golden Valley 22,552 25,800 26,700 3,248 900 Seven-County Metro Area 3,163,104 3,451,000 3,653,000 287,896 202,000 Households Golden Valley 9,957 11,400 11,800 1,443 400 Seven-County Metro Area 3,163,104 3,451,000 3,653,000 287,896 202,000 Employment Golden Valley 28,845 36,000 37,000 7,155 1,000 Seven-County Metro Area 3,163,104 3,451,000 3,653,000 287,896 202,000 * Final Forecasts issued 12/31/2024. Source: Metropolitan Council; LOCi Consulting LLC Projected Change 7 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 6 Projected Household Growth by Age of Householder, 2025 to 2030 Baby Boomers (Age 65 plus) and Millennials (Age 35-45) will continue to drive household growth Higher growth in Golden Valley for households in their typical homeownership years (Age 35 to 54) Median Age in 2025: Golden Valley: 42.5 Seven County Metro Area: 38.3 Median Age in 2030: Golden Valley: 44.0 Seven County Metro Area: 39.0 Source: ESRI; LOCi Consulting LLC 3. Projected Household Growth by Age of Householder, 2025 to 2030 8 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 7 Projected Household Growth by Income of Householder, 2025 to 2030 Overall shift in growth to higher income groups Rising incomes overall and age shifts Millennials hitting higher income earning years Baby Boomers with higher investment incomes But might also reflect lower household formation rates in lower income groups due to rising housing costs Source: ESRI; LOCi Consulting LLC 4. Projected Household Growth by Income of Householder, 2025 to 2030 9 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 8 Population by Race and Ethnicity The population of Golden Valley has remained slightly less diverse than the Seven-County Metro Area as a whole In 2023, Golden Valley’s population: 82% White (Metro: 81%) 7% Black (Metro: 8%) 2% Asian (Metro: 6%) 5% Hispanic (Metro: 6%) Between 2014 and 2023, the Black population grew from 5% to 7% and the Hispanic population grew from 3% to 5% Percent Asian declined from 5% to 2% 5. Population by Race and Ethnicity, Golden Valley, 2014, 2020, and 2023 Source: 2010 and 2023 American Community Survey, 2020 Census, US Census Bureau; Metropolitan Council LOCi Consulting LLC Note that Hispanic is an Ethnicity and not a Race. Hispanic population is made up of multiple racial classifications. 10 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 9 Population by Race in Comparison Cities Except for Edina, Golden Valley has a lower percentage of Non- White population than comparison cities Comparison cities, including Edina, have seen their Non-White populations grow at a greater rate than Golden Valley 6. Percent Non-White Population, Comparison Cities, 2010 and 2023 Source: 2010 and 2023 American Community Survey, 2020 Census, US Census Bureau; Metropolitan Council LOCi Consulting LLC Note that Hispanic is an Ethnicity and not a Race. Hispanic population is made up of multiple racial classifications. 11 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 10 Percent of Households Living Alone The city of Golden Valley has comparable rates of single person households as the rest of the Metro Area However, a larger percentage of those households are over age 65 The Metro Area is seeing an increase in single-person, senior households. While Golden Valley’s rate is declining 7. Households Living Alone, 2014, 2020, and 2023 8. Households Living Alone Over Age 65 as a Percent of All Households, 2014, 2020, and 2023 Source: 2014, 2020, and 2023 American Community Survey, US Census Bureau; Metropolitan Council LOCi Consulting LLC 12 Based on the shift in housing need and natural replacement, the 2023 Comprehensive Housing Need Analysis found demand for about 1,600 to 1,800 new units between 2023 and 2025 Some of this demand could be developed as Missing Middle Housing 13 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 12 Housing Market 14 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 13 Existing Housing Stock in Golden Valley 9 Housing Unit Inventory in Golden Valley, 2023 Source: American Community Survey, US Census Bureau; LOCi Consulting LLC 9,671 6,769 2,902 Totaal Housing Units Owner Occupied Housing Units Renter Occupied Housing Units 10 Units in the Structure, Golden Valley, 2023 Source: American Community Survey, US Census Bureau; LOCi Consulting LLC 63.1% 5.5%1.0%0.5%2.2%4.3% 23.4% 0.0% 1-unit, detached 1-unit, attached 2 units 3 or 4 units 5 to 9 units 10 to 19 units 20 or more units Mobile home Golden Valley 15 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 14 Existing Housing Stock in Golden Valley 11 Year the Structure Was Built, Golden Valley, 2023 Source: American Community Survey, US Census Bureau; LOCi Consulting LLC 0.8% 10.8% 7.8% 1.8% 9.1% 10.4% 22.0% 28.9% 5.0% 3.4% Built 2020 or later Built 2010 to 2019 Built 2000 to 2009 Built 1990 to 1999 Built 1980 to 1989 Built 1970 to 1979 Built 1960 to 1969 Built 1950 to 1959 Built 1940 to 1949 Built 1939 or earlier 12 Number of Bedrooms in the Unit, Golden Valley, 2023 Source: American Community Survey, US Census Bureau; LOCi Consulting LLC 2.8% 12.3% 20.9% 32.3% 25.9% 5.7% No bedroom 1 bedroom 2 bedrooms 3 bedrooms 4 bedrooms 5 or more bedrooms 16 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 15 Recent Residential Building Permits in Golden Valley Note: Xenia Apartment development—369 units—was approved in 2013 and permits were issued in 2017. 13 Building Permit Units in the City of Golden Valley, 2018-2023 2018 2019 2020 2021 2022 2023 Total Housing Units 137 13 4 8 10 5 Single-Family Structures 21 13 4 8 10 5 2- to 4 Unit Structures 18 0 0 0 0 0 Multifamily Units 98 0 0 0 0 0 Source: SOCDS HUD Building Permits; Minnesota Department of Labor and Industry; LOCi Consulting LLC 0 50 100 150 2018 2020 2021 2022 2023 Total Housing Units 17 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 16 Building Permit Activity in Golden Valley versus Comparison Cities Golden Valley has had fewer building permit housing units per year, compared to peer cities Average Annual Housing Units Permitted, 2000-2023 Golden Valley: 43 Edina: 192 Richfield: 79 St. Louis Park: 208 14. Total Building Permit Housing Units by Year, 2000 to 2023 Source: SOCDS Building Permits, HUD; LOCi Consulting LLC 18 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 17 For-Sale Housing Market in Golden Valley 15 Residential Real Estate Transactions in Golden Valley 321 Source: Multiple Listing Service; LOCi Consulting LLC 406 426 422 347 308 321 2019 2020 2021 2022 2023 2024 16 Median Sales Price of Home Sales in Golden Valley *2024 YTD is rolling 12-months from October 2024. Source: Multiple Listing Service; LOCi Consulting LLC $343,000 $367,450 $390,000 $425,000 $424,000 $424,000 $420,000 2019 2020 2021 2022 2023 2024 2025 YTD 17 Average Days on the Market for Home Sales in Golden Valley *2024 YTD is rolling 12-months from October 2024. Source: Multiple Listing Service; LOCi Consulting LLC 48 37 24 22 40 40 46 2019 2020 2021 2022 2023 2024 2025 YTD 19 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 18 Market Rate Rental in Golden Valley—Vacancy Rate and Average Rents 18 Vacancy Rates for Market-Rate Rental Housing in Golden Valley * Data is Q1 2018 to Q2 2025 Source: CoStar; LOCi Consulting LLC 19 Average Rent for Market-Rate Rental in Golden Valley * Data is Q1 2018 to Q2 2025 Source: CoStar; LOCi Consulting LLC 20 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 19 Rental Market in Golden Valley—Absorption of Units 20 Quarterly Absorption of Units for Market-Rate Rental in Golden Valley * Data is Q1 2018 to Q2 2025 Source: CoStar; LOCi Consulting LLC 21 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 20 Housing Affordability 22 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 21 Housing Affordability Relative to Incomes—For Sale Housing Homebuyers in Golden Valley need incomes 14% higher than the median income to afford the median for-sale home. For the Metro Area, incomes need to be 26% percent higher than the median Higher incomes in Golden Valley make the affordability index seem more affordable than the Metro Area. This might be explained by the fact that there are fewer housing options for lower- and moderate-income households, thus fewer lower- and moderate-income households Available housing may be driving incomes, not vice versa 21 Income Needed for Median Sale Price For-Sale Housing Golden Valley Twin Cities Metro Area Home Price $420,000 $401,000 Down Payment (10%)$42,000 $40,100 Estimated Closing Costs (3%)$12,600 $12,030 Total Loan Amount $390,600 $372,930 Interest Rate for 30-Year Mortgage 6.75%6.75% Monthly Payment (Principal and Interest)$2,533 $2,419 Property Tax $350 $334 Homeowners Insurance $140 $134 Mortgage Insurance $163 $155 Home Maintenance and Repair $100 $100 Total Monthly Housing Cost $3,286 $3,142 Total Annual Housing Cost $39,434 $37,704 Household Income Required Assuming 30% Affordability $131,000 $126,000 2025 Median Household Income $114,732 $99,859 Affordability Index 1.14 1.26 Source: Northstar MLS; ESRI; LOCi Consulting LLC 23 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 22 Housing Affordability Relative to Incomes—Rental Housing On average, rental affordability looks similar to homeowner affordability Higher incomes in Golden Valley mean overall rents are more affordable However, higher incomes in Golden Valley might be explained by the fact that there are fewer overall housing options for lower- and moderate-income households So fewer lower- and moderate-income households live in Golden Valley 22 Income Needed for Average Market Rate Rental Housing Golden Valley Twin Cities Metro Area Monthly Rent $1,596 $1,589 Total Monthly Housing Cost $1,596 $1,589 Total Annual Housing Cost $19,152 $19,068 Household Income Required Assuming 30% Affordability $63,840 $63,560 2025 Median Household Income $114,732 $99,859 Affordability Index 0.56 0.64 Source: Costar; ESRI; LOCi Consulting LLC 24 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 23 Cost-Burdened Owner-Occupied Housing Almost one in five homeowners (18%) in the city of Golden Valley—including both those with and without mortgages—pay more than 30% of their income in housing costs About 7% of homeowners pay over 50% of their income in housing costs 23. All Housing Cost Burdened Owner Households, 2023 Source: 2023 American Community Survey, US Census Bureau; Metropolitan Council; LOCi Consulting LLC 25. Housing Cost Burdened Owner Households by Race and Ethnicity, 2023 24. Housing Cost Burdened Owner Households by Income, 2023 Note that Hispanic is an Ethnicity and not a Race. Hispanic population is made up of multiple racial classifications. “Other” includes Two or more races, Some other race alone, or Native Hawaiian and Other Pacific Islander alone.25 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 24 Cost-Burdened Renter-Occupied Housing Four in 10 renters pay more than 30% of their incomes in rent in the city of Golden Valley Over one in five pay more than 50% of their income in rent in the city 26. All Housing Cost Burdened Renter Households, 2023 Source: 2023 American Community Survey, US Census Bureau; Metropolitan Council; LOCi Consulting LLC 28.Housing Cost Burdened Renter Households by Race and Ethnicity, 2023 27.Housing Cost Burdened Renter Households by Income, 2023 Note that Hispanic is an Ethnicity and not a Race. Hispanic population is made up of multiple racial classifications. “Other” includes Two or more races, Some other race alone, or Native Hawaiian and Other Pacific Islander alone.26 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 25 Data Resources and Study Limitations The data in this preliminary analysis are compiled from a variety of sources. Sources are identified in the tables and figures. LOCi Consulting believes that these sources are reliable. However, there is no way to authenticate this data and information. LOCi Consulting does not guarantee the data and assumes no liability for any errors in fact, analysis, or judgement. The data in this analysis includes the most recent information available at the time of this analysis. The findings, conclusions, and recommendations in this demand analysis are based on the best judgements and analysis at the time of the study. LOCi Consulting makes no guarantees or assurances that the projections or conclusions will be realized as stated. 27 Demographic Shifts, Housing Market, and Housing Affordability Missing Middle Housing Study Prepared for Bolton & Menk and the City of Golden Valley August 11, 2025 26 Contact Information: Grant Martin Principal LOCi Consulting LLC 651-888-8464 grant@lociconsult.com https://www.lociconsult.com/ Services: •Market studies •Demographic analysis •Customer segmentation •Market identification •Market sizing •Competitive analysis •Geographic Information Systems (GIS) and site selection •Data analytics 28