Housing Market Analysis
Housing Market Analysis
This is a project of the City of Upper Arlington, Ohio by CommunityScale. The information in this detailed housing market analysis is intended for the City to evaluate policies and programs that seek to grow the City responsibly and increase housing options for residents, whether they are forming a new household in Upper Arlington, entering as a new resident, or looking to remain in Upper Arlington through various life stages.
This study provides a review of demographic trends, comparable communities, regional influences, and a quantitative deep dive into issues that shape the housing market. The analysis is grounded by interviews with stakeholders such as single-family and multifamily housing developers, regional and local government staff, and housing advocates, as well as an online survey with more than 700 responses. Dive into more of the data on the Forecast page.
The regional narrative is that Central Ohio is projected to keep growing, driven by job creation (e.g., Intel, Honda-LG, and 4,000-worker advanced defense manufacturing facilities) and ongoing in-migration.
MTP’s regional forecast looks out to 2050. The Upper Arlington housing market could easily absorb 57 housing units per year given overall regional growth.
This analysis further breaks down the overall rate of household growth by household income. In this case, household incomes are grouped by their percent of HUD’s Area Median Income, which is $103,300 (Columbus, OH HUD Metro FMR Area 2025).
Should these trends continue, most of Upper Arlington’s growth looking out will be in the >190% AMI group. There will also be modest growth in the 50-80% AMI group. The other AMI groups are relatively stable.
Higher-income families attracted by the community's quality of life have a high willingness-to-pay for new housing in Upper Arlington. The median household income in the City is high and has been growing, putting it on par with communities like Dublin and Bexley, Ohio. The median income surpasses notable national communities such as Carmel, IN, Fairfax, VA, and Oak Park, IL. Due to high demand and constraints on housing production, Upper Arlington’s ownership and rental vacancy rates are less than what is considered healthy for a market, leading to pent-up demand and households not forming.
Comparable communities help market studies by providing benchmarks on key metrics such as growth, demographics, and income across areas with similar socioeconomic or geographic characteristics. In this case, each community was chosen for its relevance in size, regional context, and overall demographic profiles, allowing for a meaningful comparison of trends and conditions.
Upper Arlington is compared to other Ohio communities Dublin, Worthington, Bexley, Shaker Heights, as well as nationally similar communities Brookline MA, Oak Park IL, Prairie Village KS, Fairfax VA, and Carmel IN.
Upper Arlington has successfully attracted families but faces challenges retaining young adults (ages 20-34) and empty nesters (ages 50-64) due to limited suitable housing options. Both empty nesters and younger professionals demonstrate preference walkable, urban-style living environments. This preference was echoed in this study’s Housing Market Survey with more than 700 responses. Most responders would prefer houses with small yards within an easy to walk to places you need to go. Increasing housing diversity, including multifamily, mixed-use, and senior independent living facilities with supportive services will help retain these demographics. Given the rate of older adults in the community and their likelihood of downsizing into a new unit, an estimated 145 new senior living units could easily be absorbed by growth in the market without addressing pent up demand from existing residents.
High construction costs ($200-$300 per sq ft), coupled with rising land prices ($1.3M per acre median for lots that have been redeveloped in the last 5 years), have led to market prices for new homes well above the median income of residents. Single-family home redevelopment typically results in sale prices exceeding $1M even for smaller homes on smaller lots. The cost of larger single-family homes on larger lots is variable due to differences in land costs, but similarly are typically delivered at a market price of at least $1.8M.
Financial feasibility is driven by market rent, annual return on investment ("cap rate"), and construction costs. Market rents are competitive with the region and are around $2,250 for a 900 sq ft apartment, which is affordable to a household earning $98,000 a year. In Upper Arlington, that unit is likely to be suitable for a younger household, downsizing seniors, or empty nester. To achieve viability given land prices of about $2M per acre along with other costs, the economic model estimates that large scale rental developments would require subsidies averaging $79K per unit, which includes support for structured parking needed to reach higher density. Looking ahead, the such subsidy rates are consistent with incentives being offered by the City of Columbus and some other jurisdictions to encourage denser, mixed use development and redevelopment.
As discussed, large scale redevelopment currently requires public support to be financially viable. Furthermore, Upper Arlington competes for developers with nearby Columbus on subsidy amounts. For example, if two otherwise equal redevelopment opportunities were on the Upper Arlington and Columbus sides of Henderson Road, developers expressed that they would choose to build in Columbus due to the generous incentives offered in the form of long-term tax abatements.
New homes in Upper Arlington generate municipal revenue exceeding service costs, thus providing a net positive impact on municipal finances. The break-even assessed value per unit is approximately $619K, current market values for new construction easily surpass. The marginal cost to serve a new home in Upper Arlington is a function of services that need to scale with new demand but are not inherently covered by their own fees. Police, fire, EMS, and Parks and Recreation are funded by the City's general revenue, whereas other services like waste, water, and sewer are covered by fees connected to those services. These expenses are then balanced by revenues from property tax, income tax for work-from-home, and ongoing revenue positive building permit fees for redevelopment and renovation.
As cities grow, the cost of providing essential services per household decreases because the new homes leverage existing infrastructure and distribute expenses such as police, fire protection, and parks across more households. More precisely, the relationship between growth and overall expenses is nonlinear as cities achieve 15% efficiency gains in infrastructure and service provision. Larger cities can provide essential services like police, fire protection, and parks at a lower per-unit cost due to these economies of scale. For Upper Arlington, a 9.8% increase in housing units from 2025-2050 as forecasted by MORPC's Metropolitan Transportation Plan would only require about 8.2% additional resources. This economy of scale effectively reduces the break even point for revenue from new homes for Upper Arlington.
The City of Upper Arlington is a dynamic community, made successful by the citizens, businesses and civic groups who support the values and traditions.
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