We are gathering data on Novi, Michigan. Here is what we know so far.

Market Overview

Novi is a city in Oakland County, Michigan. The population of Novi, according to the 2010 Census, is 55,224. The total number of households in the city is 22,258. The average household size for Novi is 2.37. The total number of renter households in the city is 7,280 which means that 32.7% of households are renter households.

Rental Assistance for Tenants in Novi

Rental assistance is a type of housing subsidy that pays for a portion of a renter’s monthly housing costs, including rent and tenant paid utilities. This housing assistance can come in the form of Section 8 Housing Choice Vouchers, project-based Section 8 contracts, public housing, USDA Rental Assistance (in Section 515 properties) as well as HUD Section 202 and 811 properties.

To qualify for most rental assistance programs a renter must earn no more than 50% of the Area Median Income (AMI). In some cases, rental assistance is reserved for renters earning 30% or less of the AMI. In Novi, to qualify for Section 8 assistance, a renter household containing four persons must earn $32,300 or less. For some targeted rental assistance programs, a renter household of four can’t earn more than $19,400.

It’s important to remember that in many rental assistance programs there are minimum rent regulations requiring assistance recipients to make a minimum payment of between $25 and $50 per month no matter how low their income.

HUD Assistance Income Limits

Persons
1234
$22,650$25,850$29,100$32,300
Persons
1234
$13,600$15,550$17,500$19,400

Income Limits

All affordable housing programs provided by or through the government have maximum income limits to qualify for assistance. These income limits are typically derived from the Area Median Income (AMI), the theoretical family income of the average household in a given geography.

The AMI is updated each year for each geographical area taking into consideration numerous economic indicators. The geographical areas used for establishing the AMI are either Metropolitan Statistical Areas (MSA’s) or counties.

Novi is in the Oakland County, MI MSA. The 2014 Area Median Income for a family of four in Novi is $64,600.

The income limits used for Section 8, public housing, Low Income Housing Tax Credits. the HOME program and other Federal programs all are derived from the HUD defined AMI.

Low Income Housing Tax Credit Income Limits

Persons
1234
$27,180$31,020$34,920$38,760
Persons
1234
$22,650$25,850$29,100$32,300
Persons
1234
$18,120$20,680$23,280$25,840
Persons
1234
$13,590$15,510$17,460$19,380

Rent Limits For Affordable Rental Housing

All apartment units that receive Federal assistance whether that assistance is used to subsidize rents or the cost of construction and development, have dollar limits on the amount of rent a landlord may charge each month. These rent limits are based on the incomes of the renters the property is meant to serve.

As we explained in the income limits section, the maximum income a renter can earn to qualify is based on the Area Median income for the market where the apartment community is located. Likewise, the maximum rent is usually determined by multiplying the annual income limit by 30% (the National housing affordability standard) and dividing by 12 months.

In Novi, a family of four that qualifies for a three bedroom apartment under the Low Income Housing Tax Credit program will not pay more than $1,008. Rent limits can range greatly within the same apartment community. If the same apartment property in this example also targets persons earning less than 30% of AMI, our four person family’s 68 year old neighbor who earns less than $13,590 will never pay more than $364.

Low Income Housing Tax Credit Rent Limits

Bedrooms
01234
$680$728$873$1,008$1,125
Bedrooms
01234
$566$606$728$840$938
Bedrooms
01234
$453$485$582$672$750
Bedrooms
01234
$340$364$437$504$563

Fair Market Rents (FMR)

HUD establishes a Fair Market Rent each year for each Metropolitan Statistical Area in the country. This rent standard is used to establish payment limits for Section 8 Housing Choice Vouchers, maximum rents in HOME financed rental projects and initial or renewal rents for Section 8 project based assistance. HUD establishes FMR’s for 530 MSA’s and 2,045 counties nationwide each fiscal year.

The FMR is largely a statistical derivative of the US Census Bureau's American Community Survey (ACS) 5 year estimates for 2 bedroom median rent. For the most part, in Novi, a landlord with a two bedroom apartment to rent, could not receive more than $627. Likewise, a renter in need of a 3 bedroom apartment with a Section 8 voucher would have to find a rental in Novi that rented for less than $843.

2015 Fair Market Rents

Bedrooms
01234
$484 $487 $627 $843 $846

Fair Market Rent Percentage Change Since 1988

The affordable housing industry has long used the FMR as barometer for local rents. Though the geographic areas FMR’s are based on are broad and there are often wide variations in neighborhood rents throughout an MSA, in general, the FMR is one of the best quick tools one can use to judge housing costs in a place.

We took a look at historic FMR’s in Novi and found that they have risen an average of 1.08% year over year. The first year in our sample is 1985 when the two bedroom FMR was $403. That same 2 bedroom apartment rent had increased to $821 by 2013. In 2001 the two bedroom FMR in Novi saw it’s largest single year increase going up by 11.23%.

It’s also interesting to look at the FMR compared to the Consumer Price Index’s housing index to understand how Novi rents have fluctuated in comparison to the rest of the Nation. The consumer price index grew an average of -0.89% year over year. The two bedroom FMR in Novi has grown faster than the CPI indicating faster than average rent growth in the market.

The largest single year of 2 bedroom FMR growth was in 2001 at 11.23% while the smallest year of growth was 2015 with a 25.62% decrease.

55,224

Population

2.37

Average Household Size

14,655

Total Renters

7,280

Renter Households

22,258

Total Households

Average
(44th percentile)

Renters or Owners

32.7%

% of Renter Households

$1,003

Median Rent

$103,927

Median Family Income

37.2%

Renters Overburdened

9.17%

Households in 60-80% AMI Range

$120,738,000/year

Gross Rent Paid By All Renters

7.2%

Renters with No Vehicle

1.5%

Renters Below Poverty Level

2.5%

Renters Who Taxi, Bike, or Walk to Work

1.2%

Renters Who Use Public Transit to Work

24.3%

Renters With Children

10%

Units With Utilities Included In Rent

Michigan

State