Affordable Housing Demand in Henrico County, Chesterfield County and City of Richmond (2004)
Housing demand has grown steadily in Henrico and Chesterfield Counties in both the owner and renter housing markets (Figure 1 and Table 1). There were nearly the same number of owner households in Henrico and Chesterfield Counties in 1990 (about 58,000). Both areas grew substantially in the number of owners during the 1990s, increasing 25% in Henrico and 30% in Chesterfield. Based on currently available population projections and income trends during the 1990s, we project both the numerical increase and the rate of increase to slow during the current decade (2000-2010). In contrast, ownership demand decreased in the City of Richmond from 1990 to 2000. We project this decline to accelerate during the current decade, going from -1% to a -3% over ten years.
The decade of the 1990s saw relatively low interest rates combined with significant growth in employment and income. High returns to investors during the decade contributed to gains in real incomes, although gains from wages were less dramatic. The current decade will undoubtedly post a different economic record, although both decades started with recessions. Historically low interest rates have stimulated home buying, despite an otherwise sluggish economy. Housing construction, particularly single-family housing, has remained robust. Whether interest rates will stay low and economic growth return will only be revealed in an all-too-uncertain future. Our demographic future is less uncertain: the Richmond metropolitan area will become older as the baby-boom cohort matures toward retirement and is replaced by smaller cohorts.