Low Income Housing Tax Credit
Market Feasibility

Our Low Income Housing Tax Credit (LIHTC) studies provide a clear understanding of how the market will respond to your apartment community. 

All of our studies specified for submission to a state housing finance agency for funding will comply with that state's guidelines.  State guidelines may require us to modify or even omit some of the analysis components below. 

Conclusions/Recommendations

Specifically, our studies will provide the following conclusions/recommendations:

• Optimum unit mix, number and size recommendations
• A unit and project amenities package competitive with area developments
• Projected absorption
• At initial lease-up
• Overall average rate
• As impacted by turnover if absorption is extended beyond standard lease terms
• Determination of appropriate rents for the proposed units based on Tax Credit program guidelines
• Marketing strategies for the proposed project may be discussed if appropriate
• An evaluation of the site's ability to function with a Tax Credit residential use based on its access, visibility and environment.
• When appropriate, a discussion of the subject site's site plan and floor plan from a market perspective, identifying areas where design may hinder market response 
• Competitive Analysis. When appropriate, potentially competitive projects are compared with the proposed project and analyzed in detail, including a detailed look at floor plans, entry impact, storage space, unit and project amenities, and pricing.
• ***When required by the state, we will identify the impact of the subject property on existing area LIHTC or subsidized housing***

Supply/Demand Analyses

Supply Analysis

Supply is determined through:

• A 100% field survey of Effective Market Area modern apartments
• Data from the US Census Bureau

The supply of apartments is analyzed to identify rent and vacancy trends of units by unit type, number of bedrooms, year built, and comparability index

Demand Analysis

• An analysis of the number of income-qualified households in the EMA (based on LIHTC program income restrictions) will be conducted. This analysis will establish the number of households based on a variety of rent-to-income relationships and compare this to the number of units proposed.
• An overview of the area Section 8 program and an evaluation of potential support from program participants
• A comparison of proposed rent to expected market-driven rent at opening based on a Comparable Rent Analysis. The Comparable Rent Analysis allows for determination of market-driven rent for projects of any amenity level by using a regression analysis to analyze project rent in conjunction with its Comparability Index. (Some states ask that we omit this analysis.)
• An analysis of step-up/down support for the proposed project. Our research indicates that the largest single component of support for any apartment project is apartment tenants already residing within the EMA, and that most apartment shoppers will "step up" their rent payments for housing that they consider to be a value. Our analysis identifies this step-up support by dollar range and median. In addition, Tax Credit developments often represent a value for tenants paying higher rent for comparable units. This step-down support is identified.  (Some states ask that we omit this analysis.)
• An analysis of potential turnover vulnerability for the proposed project. Our research indicates that the largest single source of tenant "drain" from any development is the apartment communities in the EMA priced within step-up range of the subject community.
• An analysis of rent gaps. Rent gaps are the differences in rent between unit types, such as one-bedroom and two-bedroom units. Rent gaps can be a substantial factor in a project's initial rent-up. Our analysis identifies the area's median rent gap, rent gap at the proposed project's Comparability Index, and rent gap at the proposed project. Rent gap among product alternatives (such as mix, location, and floor plan) at the subject site is also evaluated.

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