Owner Occupied Housing (
large / small )This chapter investigates the dynamic social and economic forces which determine a community's ability to provide a thriving economy with a trained, stable labor force from among its residents. With sufficient household income, residents can then provide for their own needs and produce a system of education which prepares the next generation to do the same. The various forces which affect the quality of life in the City of St. Louis do not operate in a vacuum. Changes or trends in one area have an impact on all the others. Nevertheless, they are organized into six distinct subjects for purposes of review and analysis: demography, housing, infrastructure, public safety, education, and economy.
This overview of key indicators for these topics provides insight critical to preparing strategies that best address the City's needs. In this chapter, demographic aspects of the population will show what segments will grow and which will decrease in number in the near future.
The section on education will discuss enrollment trends and educational attainment.
The ultimate indicator of community vitality is the perception and reality of personal security which will be reviewed in the section on public safety.
The economic profile analyzes trends in employment and the City's labor force, and such other indicators as retail sales, office occupancy levels, and household income. With this understanding, and taking into account demographic shifts, the City can tailor programs for education and labor force training and business attraction and retention. Finally, this chapter reviews in detail a number of characteristics of its housing stock and provides implications for strategies to improve market performance and point out areas of immediate need.
Using this chapter as a base, Chapter IV and those that follow will provide more in-depth discussion of housing and community development needs and target specific programs to address them.
For most persons familiar with the City of St. Louis and the metropolitan region, a detailed discussion of demographic aspects of the City and trends in recent years would appear to be a restatement of the obvious. However, it is important to look carefully at specific age groups, income levels, and household formation patterns, for the present as well as over a period of years. Doing so will provide not only a picture of City residents today, but how they may be changing and perhaps ideas about forces which lay behind some of these changes.
As a provider of municipal services financed by property and earnings taxes, the City has a responsibility to use its resources in the most strategic, cost effective manner possible. Understanding demographic characteristics and changes will help the City provide the best services possible to its constituents.
This section provides an overview of traditional demographic components. These include total population, racial composition, age characteristics and household formation. Information concerning household and family income levels is included in the section on economy, since it is both a cause and effect of economic forces within the region.
According to the U.S. Census Bureau, the 1990 population of the City of St. Louis totaled 396,685 persons. Fifty-one percent of the residents were White, 48 percent were Black, the remaining one percent consisted of a mixture of Asian and other ethnic groups. The 1990 population represented a 12 percent decrease, or a drop of 56,400 persons from its 1980 level. This loss was primarily a result of net out-migration of almost 76,000, which overwhelmed the gains resulting from natural population increase. During the ten year period the birth rate increased from 3 births per 1000 population in 1980 to 7 in 1990.
For 1994, Urban Decision Systems, a population forecasting firm, estimates the City's population at 380,996, for a decline of 4 percent since 1990. Net migration from the City since the 1990 Census is believed to be about 23,421 during the same period.
When compared to the rest of region, the City's net decrease of 12 percent from 1980 to 1990 is mirrored by a 7 percent increase in the St. Louis MSA. St. Louis' percentage of the total regional population has declined from 26 percent in 1970, to 19 percent in 1980, to 16 percent in 1990. It is estimated that the percent of the region's population has slipped slightly to 15 percent using the 1994 estimates. Nevertheless, it remains the largest municipality in the region in terms of population, even if its dominance in other areas has faded.
The population of St. Louis for the year 1999 is forecasted to be 365,287, reflecting an 8 percent decline since the 1990 Census level.
Map 1 illustrates that areas with the highest percentage of population decline during the past decade were located in the northern portions of the City. Losses greater than 30 percent occurred in the vicinity of the Mark Twain and Walnut Park neighborhoods. Much of the remainder of the north side lost between 15 and 30 percent of its population.
Population Change (large / small)
In the southern portion of the City, most areas sustained a loss in the range of 5 to 15 percent. A few areas scattered both north and south reported relatively stable populations with either a gain or loss of less than 5 percent.
Finally, several areas reported an increase in excess of 5 percent. These were concentrated in the Lafayette Square, Soulard and West End neighborhoods, areas experiencing substantial renovation and restoration. As population on the northside declines, the center of the City's population base has shifted to near south side neighborhoods.
The City's racial composition has remained nearly 50 percent White and 50 percent Black for nearly 20 years. Major shifts have occurred, however, in the location of the Black population. Substantial portions of the south side of the City are now racially integrated. This includes areas south of I-44, including the Shaw, Tower Grove, Grand Oak-Hill, and Dutchtown neighborhoods. Given crime rates in much of the City's north side neighborhoods, this migration to the south is understandable.
The loss of City population during the 1980's consisted mostly of Whites, 40,491, or 17 percent of the White population. However, a sizeable number of Blacks left as well, nearly 18,000 persons for a 9 percent decline. Neighborhoods most affected by changing racial composition are illustrated by Map 2.
While the overall percent of non-Black racial minorities is very small, they have increased in number since 1980. In 1990 there were about 3700 Asians or Pacific Islanders, and another 2500 persons from other races or ethnic groups. The number of Asians more than doubled, and the other racial groups grew slightly since 1980. The increase in the Asian minorities is visible in certain business districts in the City.
According to Census data aggregated for the United Way, out-migration from the City to the surrounding metropolitan counties resulted in disparate patterns of population change. During the 1980's, the number of elderly city residents (age 65 and Older) declined by 17 percent, compared to a substantial increase of 24 percent in surrounding communities. All of the elderly population loss in the City came from the 65 to 84 age group. Both the City and its suburban counterparts gained population in the over 85 group, about 12 percent for the City, and 49 percent for the MSA. Areas of the City with the highest percentage of older adults are located south of Arsenal and west of Kingshighway.
Elderly Population (large / small)
Population differences also occurred in older, working age adults (45 to 64 years), declining 28 percent in the City, and growing 3 percent in the rest of the metro area.
The City also experienced decreases of about 26 percent in the number of residents age 45 to 54, and declines of 24 percent in the segment age 60 to 64. These same age groups increased in the metro area 5 percent and 11 percent respectively.
The City was able to retain, with a small 1 percent increase, its segment of the younger, working age population aged 18 to 44 years. This same group for the rest of the region increased by 12 percent.
Despite an increased birth rate, the City lost about 16 percent of its population in the 0 to 17 age group.
Areas with a high percentage of persons under 19 years of age are located in much of the north side, with the heaviest proportion within the near north side and the Hyde Park vicinity. In these areas, the percentage of young people exceeds 27 percent. The near south side neighborhoods of Dutchtown and McKinley Fox also report large numbers of young people.
In 1990, 164,931 total households were located in the City. Of these, 56 percent were families, 39 percent were single person households, and the remaining 5 percent were comprised of households with two or more persons not considered families. Of the families, 56 percent were headed by married couples. Over half of all families, either with or without a married couple as the head, had children under 18 years of age.
Of all families with children, 40 percent were headed by a married couple, 29 percent were headed by two or more adults who are not married, and the remaining 31 percent were headed by a single person. Of those headed by a single person, 77 percent were women, with the remaining 23 percent men.
The level of single parent households is considerably higher than any other county level government in the MSA. Given the concentration of large numbers of children in the northern tracts of the City, it can be expected that a large number of the female headed households are located there as well.
Household size decreased over the past ten years as a result of increasing numbers of persons, often elderly, living alone. In 1990, the average household size in the City was 2.35 persons, slightly below the national average of 2.60. Household size in the City has been decreasing steadily for the past three decades, from 2.81 in 1970, to 2.48 in 1980, to 2.35 in 1990.
Of the 164,000 households in the City, almost 40 percent consisted of single persons. Another 26 percent contained two people, meaning that two-thirds of the city's households contain two or less individuals. About one fourth of the households contain either 3 or 4 persons. The remaining 9 percent of households consist of five or more persons.
Given present trends, the City is likely to continue to lose population, possibly reaching 360,000 by the year 2000. Although natural population growth may slow as the population continues to age, net out-migration will likely be the primary cause of population decline.
By the year 2000, large decreases may occur in the number of adults between 25 and 34 years of age, and older adults in the 60 to 69 year and 75 to 84 age groups. Also, a projected decline in women of childbearing age may lead to decreases in the number of children under age 5.
Areas where the population may increase include young people age 15 to 19 years, adults 40 to 54, and seniors over age 85.
It is expected that households will continue to decrease in size as the population ages. Again, given present trends, the number of households headed by single persons as well as the number of single person households will increase.
The decrease in the number of those in the 25 to 34 age group could be a source of concern as this group is most likely to be a first time home buyer, start a family, and become established in their occupations. It is this group who, if established, is most likely to continue to remain in the City and raise their families there, contributing to neighborhood stability.
An increase in those over age 85 has implications for public safety and housing needs. This population may need to increase their reliance on a variety of community support services, such as meals on wheels, and home security and maintenance programs.
The decrease in those under age 5 may result in declining kindergarten enrollments in the next few years. This decline may simply be a one or two year phenomena, depending upon where in the 1 to 5 age group the decrease has occurred, or it may represent a downward enrollment trend over a longer term.
The City of St. Louis offers a diverse, often architecturally significant housing stock in a number of single or multi-family settings. Its buildings, almost always brick, closely spaced on tree lined streets, pulled close to the curb, offer character and a sense of community that is unmatched in the region. Many of its neighborhoods offer a level of distinction found only in older eastern cities in the United States or in Europe.
In previous years, these buildings and favorable tax laws for rehabilitating older and historic structures were potent forces for stimulating a housing renovation and construction industry that had not been seen for thirty years. These housing programs, often combined with Section 8 rental housing assistance, provided assistance to families of diverse income levels. The 1986 tax reforms brought this activity to a halt.
At the same time, pervasive shifts in employment from the high wage manufacturing sector to the lower wage service industry have created high levels of unemployment and underemployment. Combined with the population's lower than average educational attainment, the reduced earning capabilities of many of the City's households have made much of the City's available housing, already the most affordable in the nation, too expensive.
Within the last ten years, the City has been faced with a flat for-sale real estate market and a population with immense unmet housing needs. This section examines the various components of the existing population and its housing needs against the supply of existing housing and discusses where imbalances occur. It reviews recent trends in the for-sale market for single family homes. Finally, the section explores issues of housing affordability for both renters and homeowners.
A. Existing Housing Demand
The demand for housing is a function of many factors, including household size and composition, household income, occupation, and lifestyles. This section examines the existing demand for housing in the City of St. Louis based primarily on those factors relating to household size and composition. Where relevant, this section will also examine trends in housing demand as the composition of the City's households have changed over the five year period from 1987 to 1991.
The American Housing Survey (AHS), conducted in 1987 and 1991 by the U.S. Census Bureau provides detailed information about households and housing units. That portion of the AHS survey that relates to households provides some indication about current housing demand. Since different household types have different housing needs, a review of major categories of households will provide some insight into different facets of this demand.
The four major categories of households as illustrated by Table 1 consist of the following:Within these categories, a range of sub-categories are tabulated. These include households broken out by age, gender and marital status of heads of household.
a. Single Person HouseholdsOf the 161,200 households tabulated by the AHS, 37 percent were one person households. The remaining 63 percent were households with two or more persons. White households outnumber Black households in both of these categories. About 63 percent, or 60,500 of the 2 or more person households are White, and 37 percent are Black.
The racial disparity is slightly more pronounced with single person households, where 67 percent are White and 33 percent are Black. Of the single person households of both races, the majority, 59 percent, are female, with 51 percent of these over age 65.
b. Two or More Person HouseholdsIn the category of households with two or more persons, 101,000 total, it is significant to note that the majority are not married couples. Over half consisted of "other" male or female household heads, the vast majority of these female.
However, of all the households with two or more persons, the largest category by far is that of White married couples age 25 to 44, 17,700. This number has remained constant during the past five years, and may indicate some success in retaining families within the City. For Blacks, there are 3,900 households headed by married couples within this age group.
Of the 40,500 female heads of households with two or more persons, 25,000, or 62 percent are Black, and 15,500, or 38 percent are White.
As mentioned previously, this section examines the demand for housing based upon household size, assuming that families are able to afford housing sufficient to meet their space requirements. Housing size is typically measured by number of bedrooms, thus demand for housing will be classified in this way as well.
Assumptions were made concerning household composition when determining bedroom requirements. For example, a household with three persons might consist of a married couple with one child, where a two bedroom home would be adequate. However, if that household consisted of a single household head and two children of the opposite sex, three bedrooms would be needed. In order to break out these various housing requirements, the information regarding total household size was evaluated against other Census figures relating to number of children in households and the number of single adult or two adult heads of household.
Table 2 shows demand for housing by number of bedrooms, broken down by household size. The large number of single person households and married couples with no children is reflected in the demand for one bedroom housing units, 97,436, or 59 percent of the households in the City. The second largest category of demand is for two bedroom units, which could provide housing for an array of household types ranging from a single parent and one child to a married couple with two children of the same sex. An estimated 36 percent of households in the City would fall in the two bedroom need category.
| Household Size | # of Households | 1 BR | 2BR | 3BR | 4BR | 5BR+ |
| 1 | 63,932 | 63,932 | ||||
| 2 | 44,228 | 33,504 | 10,724 | |||
| 3 | 23,002 | - | 18,991 | 4,011 | ||
| 4 | 16,406 | - | 5,775 | 10,631 | ||
| 5 | 8,974 | - | - | 3,982 | 4,992 | |
| 6 | 3,994 | - | - | - | 3,994 | |
| 7 | 3,868 | - | - | - | - | 3,868 |
| TOTALS | 164,404 | 97,436 | 35,490 | 18,624 | 8,986 | 3,868 |
As household size increases, the number of units required decreases. For example, the smallest category of housing need is for households with seven or more members. Almost 4,000 households fit this category, where it is assumed that at least five bedrooms would be required.
a. Housing Inventory
According to the U.S. Census for 1990, there were 194,919 dwelling units in the City of St. Louis. These include units of all sizes: renter, owner occupied, single and multi-family. Previous evaluations of building conditions in the City of St. Louis have estimated that nearly 30 percent of all units have major deficiencies. A far larger percentage was in need of minor building repair.
Although such estimates are subjective, there is little evidence to suggest that a substandard estimate of 30 percent of all housing units is not unrealistic at the present time. In addition to structural condition, a substandard designation takes into account such factors as vacancies, degree of overcrowding, and obsolescence.
It is also realistic to expect that those substandard units are likely to be distributed unevenly across the spectrum of available housing by bedroom size. In other words, given the difficulties associated with locating and maintaining large dwelling units, it is likely that a higher percentage of these units will be substandard than their one or two bedroom counterparts.
For example: Four and five bedroom units built before WWII can have higher utility costs than those of comparable size and type built after 1940. Large (5 or more) low and moderate households must pay higher proportion of their income on utilities and household operation than on routine maintenance.
Further, (4 or more) low income households must spend more for housing. This would then translate into an increased likelihood that these households would have difficulty in purchasing and maintaining a suitable home. They would also face challenges in finding rental units of sufficient size with affordable monthly rates. Hence, large families may often be forced into substandard housing because they are unable to afford any other.
However, for purposes of this analysis, the percentage of substandard units is considered to be 30 percent for each category of unit size. Table 3 illustrates the current available housing supply in St. Louis by bedroom size.
As illustrated by this table, of the 136,414 standard housing units in the City, about 72 percent consist of one and two bedroom units. Standard housing units with four or more bedrooms make up about 3 percent of the housing supply, or about 3,686 units.
| Unit Size (Bedrooms) | Available | Percent Substandard | Standard |
| Studio/1 BR | 67,504 | 30% | 47,252 |
| 2 BR | 74,043 | 30% | 51,830 |
| 3 BR | 34,948 | 30% | 24,463 |
| 4 BR | 12,587 | 30% | 8,810 |
| 5+ BR | 5,837 | 30% | 4,086 |
| TOTALS | 194,919 | 30% | 136,441 |
b. Age of Housing
Given the age of the City of St. Louis and the fact that its "glory days" of strong population growth and industrial dominance in the region preceded World War II, it is understandable that the age of its housing stock would reflect the pre WWII era as well.
Although new construction occurred during the decade, the overall housing stock in the City of St. Louis aged considerably. In 1990, approximately 70 percent of the City's occupied housing units were built prior to 1950, with over half built before 1940. Of these, a substantial portion were constructed during periods of expansion in the City's history, particularly in the 1890's, during the World's Fair era of the early 1900's, and during the 1920's and 1930's.
The median year of construction was 1939, compared to 1958 for housing units in the entire metropolitan area. Rental units are relatively newer, with 16 percent of the rental units and only 3 percent of the owner occupied units 20 years of age or less.
Obviously, older buildings pose continual maintenance challenges for their owners. With 15 year lifespans for most residential mechanical systems, many City residential dwellings have experienced multiple updates, renovations, and repairs. Many of the buildings renovated in the mid and late 1970's may soon be due for structural repairs or replacement of some of their mechanical systems.
Since 1979, the City has experienced a resurgence in new building construction and gut rehabilitation. Much of this occurred during the early 1980's with the introduction of the historic rehabilitation tax credit, eliminated in 1986. Table 4 illustrates construction activity in the City of St. Louis since 1979.
Year | New | Year | New | Rehab* |
| 1979 | 561 | 1987 | 751 | -- |
| 1980 | 821 | 1988 | 382 | 59 |
| 1981 | 302 | 1989 | 150 | 24 |
| 1982 | 1,099 | 1990 | 39 | 231 |
| 1983 | 585 | 1991 | 121 | 11 |
| 1984 | 506 | 1992 | 39 | -- |
| 1985 | 62 | 1993 | 78 | 65 |
| 1986 | 210 | 1994 (ytd) | 35 | -- |
The following Table 5 compares the figures developed for housing demand by household size with housing availability as depicted in the inventory.
| Type (BR) | Demand | Available | Standard | Balance |
| Studio/1 BR | 97,436 | 67,504 | 47,252 | (-)50,184 |
| 2 BR | 35,490 | 74,043 | 51,830 | (+)16,340 |
| 3 BR | 18,624 | 34,948 | 24,463 | (+)5,839 |
| 4 BR | 8,986 | 12,587 | 8,810 | (-)176 |
| 5+ BR | 3,868 | 5,837 | 4,086 | (+)218 |
| TOTALS | 164,404 | 194,919 | 134,071 | (-)27,963 |
For example, the first line of the Table examines supply and demand factors for Studio and 1 Bedroom units. According to the U.S. Census, there are 97,436 households which consist either of single persons or couples without children. There are 67,504 housing units of this type available. Of these, 70 percent, or 47,252 are in "standard" (as opposed to substandard) condition.
This negative balance would imply that there is a shortage of 50,184 units for people who need one bedroom units. Of course, in reality many single persons and married couples prefer and can afford two or more bedroom homes or apartments. In fact, some of the surplus figure of about 16,000 units in the two bedroom classification is probably occupied by households where a one bedroom unit would suffice. It is also possible that many of the elderly, who comprise much of the one-person household category, are now living in units too large for their ability to maintain or navigate safely.
The estimate of substandard units of 30 percent overall results in a small surplus of units in the five bedroom category, and a small shortage of units in the four bedroom category. However, since it is widely accepted that larger households are often forced to reside in substandard housing because they cannot afford more suitable space, it is likely that a far greater percentage of substandard units in this category exists.
While the number of households in the four or more bedroom category is small as a percentage of the total number of households, about 8 percent, the total number of City residents in households in need of them is quite large, nearly 80,000 persons. In other words, nearly 20 percent of the City's population requires housing with four or more bedrooms. Even more important, those most affected are by and large children, and a sizeable percentage of the City's population under 18. Inadequate housing can often translate into health and safety issues as overcrowding becomes more prevalent in these households.
The need for additional housing of almost every size is validated by the waiting list prepared by the St. Louis Housing Authority There are currently 15,728 individuals or families requesting housing assistance through the Section 8 program. While many of these individuals may not be City residents, the number illustrates the need to pursue a strategy aimed at improving the quality of the City's housing stock, either through new construction or major rehabilitation. Further, with the major portion of the inadequate housing burden falling upon children, it is important to address the needs of households with families, and large families in particular.
The section on housing affordability will examine aspects of Section 8 needs in greater detail.Finally, vacancy levels in some areas of the City reinforce the need to provide standard housing to families. According to the 1993 CHAS based upon the 1990 Census, vacancy rates vary from 1.1% in some areas to 38.6% in others. The higher levels are usually found near industrial areas or in northern neighborhoods where deterioration is greatest and homeownership is extremely low. As would be expected, the largest proportion of substandard housing is located in these areas. In addition, higher concentrations of female headed households tend to locate in areas of high vacancies, reflecting high levels of poverty among these households.
Another view of the City housing market is afforded through the window of market rate sales, especially for single family homes. The Multiple Listing Service (MLS) prepared by the St. Louis Association of Realtors provides comparable information on sales by municipality and for the region (west of the Mississippi) as a whole. The MLS provides information concerning "Days on Market" or DOM, which states how long a listing was carried prior to its sale. Generally, areas where the average DOM exceeds the region as a whole may indicate a problem with lack of demand. MLS also tracks average single family home sale prices for four areas in the City: east of Grand (east), north of Dr. Martin Luther King (north), between Martin Luther King and Arsenal (central), and south of Arsenal (southwest). See map in appendix.
Table 6 compares average sales price, Days on Market, and ratio of sale price to list price for the four geographic sub-areas in the City, and compares them to the region as a whole. It should be noted that the MLS listing of sales does not represent all sales of property that occur. Many homes are sold "By Owner" without the involvement of a licensed agent. Other properties are transferred by real estate investment companies that would not be tracked by the MLS. These factors apply for other properties in the region as well, so while these average values may vary from the actual values, the comparison among various locations within the City and the region as a whole is useful.
A. Average Sale Price
As shown on the Table, of the four geographic groupings for home sales, the Central west area, bordered by Grand on the east, Martin Luther King on the north, the City limits on the west, and Arsenal on the south clearly leads the City in value of average single family home sales. Values range from $99,600 to $116,600 in the period 1990 to June, 1994. This compares favorably with the region as a whole, and is substantially greater than the value ranges of its closest competitor in the City, the southwest. Values in the central area exceed the southwest averages by nearly two-thirds.
While the Central Section contains many World's Fair mansions on private streets, it also is home to some rather distressed areas north of Forest Park as well. It is likely in this case that the sale of the larger homes at much higher values than average would tend to pull value levels in this district upward. It is also possible that many of the sales at the lower range were not listed with the MLS. In any event, the apparent strength of the market in this section of the City is good news.
| YEAR | AREA | AV. SALE PRICE | AV. LIST PRICE | SP:LP | DOM |
| 6/94 | Region | 113.8 | 118.1 | 96.4 | 71 |
| Grand East | 59.0 | 62.8 | 93.9 | 121 | |
| Southwest | 64.1 | 68.3 | 93.9 | 84 | |
| Central | 106.2 | 112.4 | 94.5 | 105 | |
| North | 39.6 | 41.8 | 94.7 | 108 | |
| 1993 | Region | 113.2 | 118.2 | 95.8 | 83 |
| Grand East | 59.1 | 63.7 | 92.8 | 106 | |
| Southwest | 66.2 | 70.3 | 94.2 | 84 | |
| Central | 116.6 | 125.0 | 93.3 | 105 | |
| North | 38.5 | 41.3 | 93.2 | 128 | |
| 1992 | Region | 106.6 | 115.5 | 95.6 | 84 |
| Grand East | 58.8 | 63.8 | 92.2 | 107 | |
| Southwest | 64.6 | 68.5 | 94.3 | 79 | |
| Central | 109.2 | 117.3 | 93.1 | 110 | |
| North | 36.7 | 40.3 | 91.1 | 119 | |
| 1991 | Region | 104.4 | 109.8 | 95.1 | 84 |
| Grand East | 58.3 | 62.8 | 92.8 | 104 | |
| Southwest | 65.3 | 69.4 | 94.1 | 72 | |
| Central | 99.6 | 107.9 | 92.3 | 100 | |
| North | 35.6 | 39.1 | 91.0 | 119 | |
| 1990 | Region | 100.9 | 105.7 | 95.5 | 84 |
| Grand East | 55.5 | 59.4 | 93.4 | 101 | |
| Southwest | 63.5 | 67.5 | 94.1 | 72 | |
| Central | 109.8 | 117.4 | 93.5 | 98 | |
| North | 36.2 | 38.8 | 93.3 | 123 |
Average sale prices in the southwest section have remained relatively stable, starting at $63,500 in 1990 and hovering within a range of $3,000 up to the current $64,100 in June of 1994. This area also includes the St. Louis Hills and Holly Hills areas of the City, where market values are generally substantially higher than the sale prices reflected by this table. While these areas are sizeable, they do not contain the blocks of very large homes on private streets that command much higher than average prices.
The Grand East district, bordered by Grand on the West and the Mississippi River on the east, reports sales ranging from $55,500 in 1990 to $59,000 in 1994. While this area contains many rehabilitated and new homes in several historic areas, sales of these homes were not sufficient to lift average sale prices to levels experienced in the region as a whole.
Sale prices in the north district, bordered by Grand on the East, the Mississippi River on the north, the City Limits on the west, and Dr. Martin Luther King on the south, reflect the massive disinvestment that has occurred over a generation. Here values ranged from $35,600 in 1991 to $39,600 in 1994. The north district, while clearly distressed in general, has pockets of stable neighborhoods with large, well maintained homes. However, overall neighborhood conditions has suppressed these values. In addition, often sales of the City's Land Reutilization Authority (LRA) homes are recorded in the MLS which would tend to pull down values in this area.
B. Other Market Indicators
The MLS data shown on the table also reflects the ratio of sale price to list price and Days on Market. Areas where market demand is strong typically experience short listing periods where sellers may be fortunate to receive "full price" sale contracts, sometimes even in excess of the asking price. By contrast, in areas of weak demand, homes tend to sit on the market longer, and the seller may have to agree to sales prices for greater than average reductions from the list.
The variance and ranges of average sales prices and its relationship to the region is measured by the sale price/list price ("SP/LP") ratios and the average days on market. In all cases, the SP/LP ratio was greater for the region as a whole than the four geographic areas in the City. Within the four areas, the southwest tended to have higher ratios, with the exception of June, 1994 where the north district was the strongest. In most years, the north reported the lowest SP/LP ratio, reflecting weaker demand there.
Similarly, with days on market ("DOM"), the length of the listing period is generally shorter for the region as a whole than almost all of the geographic sub areas. The exception is the southwestern district, where DOM was shorter than the region during the period 1990 to 1992. In 1993 and 1994, the DOM exceeded the regional average, but not to a significant degree. Combined with the SP/LP ratios, the DOM indicates that the southwest section enjoys a stronger pattern of market demand, despite lower than average sales prices.
In the other three geographic areas, the DOM substantially exceeded the regional average. In most instances, the north DOM exceeds the regional figure by 40 to 50 percent.
C. Factors Shaping Market Demand
Several surveys discussed in the 1993 Comprehensive Housing Affordability Strategy for the City of St. Louis (CHAS) address some of the forces which affect housing demand. They point to common motivations which influence families to purchase homes, and concerns about their neighborhoods which cause them to move.
Of 32,200 persons who had moved to St. Louis in the year preceding 1991, 9,100, or 28 percent, said the house was the most important consideration in choosing their neighborhood. The next most important reason for moving was convenience to friends and relatives. This reason was cited by 21 percent of the survey respondents.
Other factors influencing their move were convenience to work (17 percent), looks and design of neighborhood (11 percent), and good schools (6 percent). Reasons cited infrequently were convenience to leisure activities, convenience to public transportation, and other public services. A very large percentage listed "other" factors.
Blacks and Whites differed somewhat in their views. For Blacks, the most important consideration was the house itself. Fully one-third of the survey respondents cited this factor as a reason for their move. Excluding the "other" category, the alternative choices were supported to a much lower degree. For example, 11 percent cited convenience to friends and relatives. The looks and design of the neighborhood was selected by another 11 percent.
Whites chose convenience to friends and family most often (29 percent). However, other factors cited with similar frequency include the house itself (25 percent) and convenience to work (22 percent).
The same survey of recent movers into the City asked respondents their reasons for leaving their previous residence. The two factors cited most frequently by all were personal reasons (30 percent) and housing unit related (29 percent). However, 35 percent of Blacks, compared to 24 percent of Whites gave the housing unit as their reason for leaving their previous residence. Personal reasons were a factor for 36 percent of Blacks and 26 percent for Whites.
When examining reasons for leaving one home and choosing another, these surveys indicate that Blacks share a greater level of concern with the suitability of the home itself. This may reflect an increased need to locate standard housing for this segment of the population.
Of those individuals who had recently moved in 1991, according to the AHS, almost 60 percent already lived in the City. Another 25 percent lived elsewhere in the St. Louis metropolitan area. The remaining 15 percent originated from locations outside the metro area. In 1987, 53 percent of recent movers were already living in the City at the time of their move. Of Black households who had recently moved in 1991, 70 percent were coming from another City location. For non-Blacks, that figure drops to 52 percent.
The AHS survey of perceived neighborhood problems shows a rising level of concern about the character and safety of their neighborhood. When asked to rate their neighborhood on a scale of one to ten, with one being the worst, 9 percent gave their neighborhood a rating of "1 to 3" compared to 7 percent in 1987. This rating for Blacks increases from 13 percent in 1987 to 17 percent in 1991. Among whites, 4 percent gave their neighborhood a rating of "1 to 3" in 1987 and 5 percent did so in 1991.
Similarly, the number of people who thought their neighborhood the best, or a "10," declined during the five year period. In 1987, 31 percent gave their neighborhood a perfect score, compared to 21 percent in 1991. For Blacks, those giving their neighborhood a perfect score decreased from 28 percent to 18 percent respectively.
Still, half of Blacks and 68 percent of Whites rated their neighborhood a "7" or higher.
The AHS also examined factors considered problems by City residents. The majority, 58 percent, said their neighborhood did not have any problems. This figure drops to 45 percent for Blacks and increases to 65 percent for Whites. The number of Black respondents who believe their neighborhoods have problems have increased from 43 percent in 1987 to 55 percent in 1991. By contrast, the number of Whites who felt their neighborhood had problems decreased slightly from 39 percent in 1987 to 35 percent in 1991.
Of all the problem areas listed, "people" was cited as the greatest area of concern by both races.
The second highest area of concern was crime. During the five year period between AHS surveys, the "People" concern decreased for Whites, but increased for Blacks. The concern about crime nearly doubled overall, and nearly tripled for Blacks.
The concern about "people" may be a function of the high number of multi-family or non-owner occupied housing in many City neighborhoods. Area residents have no control over decisions about who moves into their midst at a time when many absentee landlords inadequately screen potential tenants. Concerns about "people" clearly represent a degree of anxiety on the part of City residents.
Owner Occupied Housing (
large / small )
The Homebuyers Survey conducted in 1992 developed three profiles of single family home buyers in the City. While a detailed discussion of this is contained in the CHAS, the three types vary chiefly by household income. Those earning under $30,000, about 30 percent of all sales, tended to move south of I-44. Most had not finished college. About 55% were over 45, with 17% over 55. This category had the highest level of minority participation, about 16 percent.
The second group had a household income of between $30,000 and $60,000, comprising about half of all home sales in the City. Almost all sales were in central or south City. This group was the most likely to be first time home buyers. About three fourths are married. While half have children, they are more likely to be under age 5 than any other group.
The group with the highest household income, $60,000 or more, comprised about 20 percent of City home purchasers. This group had the highest education level, was most likely to be married and have younger children. They tended to reside in historic areas, such as the Central West End, Soulard, or Southwest City.
This survey paints a picture of St. Louis homebuyers that are primarily White, in the $30 to $60,000 income range, indicating problems with affordability and interest among their Black counterparts.
From the previous discussion about existing household composition and housing supply, it appears that the problems with housing in the City of St. Louis are primarily ones of affordability and availability, based on the high percentage of substandard units.
The 1993 CHAS Five Year Strategy examined the issue of affordability in some detail. Affordability is a function of household income, and in the City of St. Louis, a large percentage of households are unable to own their own home at any price.
For purposes of illustration, the median housing value in the City for 1990 was $49,700, according to the U.S. Census. Assuming a family could make a 5 percent downpayment (less would be required if it were FHA or VA financed), they would have a mortgage for $47,215. At 8 percent interest for 30 years, the principle and interest payment would be $346.45. Adding another $100.00 escrow, a conservative estimate, for taxes and insurance (not including mortgage insurance) and the house payment is $446.45.
HUD guidelines say that housing is affordable if its cost is 30 percent or less of a family's adjusted gross income. A house payment of $446.45 is affordable for those households earning $1,484 per month, or about $18,000 per year. While the average household income in the City is $27,457, the median is $19,458, very close to the affordability threshold for the median housing value. Of the 164,404 households in the City, 40 percent have incomes below $15,000. For blacks this figure is 53 percent.
Carrying the illustration further, the median dwelling unit size is 4.6 rooms, and probably contains two bedrooms. Housing Units at this price range would often be too small to meet the needs of those most likely to have the lower household incomes: the families with children headed by females who comprise 75 percent of the households in poverty. Also, since these units are older, their operating and maintenance costs will add to affordability difficulties for even a median priced home for a large proportion of City residents.
For rental units, the median rent of $342.00 would probably be sufficient for smaller sized households. Larger units with three or more bedrooms would have higher rent levels and be out of reach for those families who need them most.
Of 68,428 households with an income of 50 percent or less of the region's median family income, 70 percent rent their housing, or 48,026. Of these very low income renters, 34,747, or 72 percent pay in excess of 30 percent of their household income for rent, indicating a tremendous problem with affordability among this group. Again, the Section 8 waiting list bears out these realities.
Chapter Four will provide more detailed information concerning housing affordability and its implications for the City's 1995 housing program.
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