Pharos-Tribune

January 26, 2014

Housing shortage?

ED leader, real estate brokers: Too few houses for good new jobs

by Sarah Einselen Pharos-Tribune
Pharos-Tribune

---- — Peter and Rachel Rogers just wanted a three-bedroom house in Logansport for their growing family.

But it wasn’t that easy.

Peter Rogers, a native of Logansport, was offered a post at Grissom Air Reserve Base in 2011 and decided it was time to settle down near his parents and church after several years traveling with the military.

“We started thinking that we could just look at what was out here for sale, pick something and close quickly,” Peter Rogers said. Instead, they’d be shown a house newly listed for sale and decide to make an offer, only to find out the seller had accepted another offer already.

Finding a move-in-ready, three-bedroom home listed for between $90,000 and $110,000 was proving difficult.

“There was just absolutely nothing out there for what we were looking for,” Peter Rogers said. “The few homes that were on the market, they were, to put it lightly, needing some TLC.”

And the Rogers aren’t the only ones who have noticed.

Economic development leaders and real estate brokers around Cass County are saying the local market has seen fewer houses listed at this time than normal, and very few houses suitable for a key demographic: Mid-level employees who want to move their families close to their work.

That’s key, explained economic development spokesman John Hipskind, because it’s one of the first things businesses look at when they’re thinking of opening a facility or office in Logansport.

“They often want to know basic things — workforce, education levels, amenities for the community and housing,” Hipskind said. In conversations he’s had as director of the City of Logansport Economic Development Organization, he said he’s heard several business representatives become concerned over the lack of housing for those filling their middle and upper management positions.

“There’s a shortage of available housing,” Hipskind said.

While some listing activity is cyclical — people usually don’t want to list a house for sale during Christmas or in bad weather, local brokers say — the inventory of homes for sale at present is still significantly lower than it was at the beginning of last year.

Cass County’s December data from the Indiana Association of Realtors indicates the inventory of homes for sale at the end of 2013 stood at 209 residences, a 3.7 percent decrease from December 2012.

However, new listings for the month had dropped 34.8 percent year over year and closed sales jumped 78.9 percent, to 34 in December.

As of Jan. 17, 179 single-family residences were listed for sale in Cass County’s multiple listing service, according to local real estate broker Tom Scheetz. Prices ranged from $10,000 to $299,000.

“Our particular office, we would normally run 125 to 150 listings normally, and right now we have 95,” he added. “We’re hoping it’ll pick up in the spring … we’ve never been this low.”

Longtime Logansport real estate broker Judy McNarny agreed.

“It’s to the point where if you’ve got somebody looking for something you may not find it,” she said.

That’s concerning to Hipskind, who says he’s also heard from representatives at Logansport Memorial Hospital that recruiting doctors has been harder in part because of the few houses available for them to consider.

It’s exactly what Scheetz found when two former clients — a doctor and a professional — bought houses out of the county.

“I said, why did you do that?” he recalled, and the answer he got was that there weren’t any suitable houses in Logansport.

“I was really surprised because they both work in Logansport,” Scheetz said.

He has observed others relocate to Kokomo, Lafayette, or around the lakes in Monticello or Rochester.

However, some business representatives aren’t as concerned as Scheetz about local housing.

Carter Fuels plant manager Brad Angle said some of the new salaried employees hired at the facility, particularly in the engineering group, have taken houses in Lafayette or Kokomo instead of moving to Logansport.

He could not say specifically, but he assumed housing was one of the considerations those employees made, he said. But he didn’t think the housing inventory in Cass County would impact how well the company can recruit other employees if it can’t hire someone who’s already in the area.

“With the new road between here and Lafayette, that’s not a bad trip from Logansport to Lafayette and back, like it used to be,” Angle said.

Hipskind made a presentation to the Realtors Association of Central Indiana last November about what he saw as the local shortage.

“So far they’re not really able to show a market need, to interest someone to build spec homes,” Hipskind said.

Spec homes are those a contractor builds before having a buyer for them, often built on land developed as a subdivision. It’s been several years since a subdivision of spec homes was developed in Cass County.

“We have said for years, if we ever do get some big new industry that comes in here … we are going to have a housing shortage,” McNarny said.

Scheetz echoed her, saying if 50 new jobs were to come to Logansport, “I’d be a little nervous about what we would sell them.”

“I’m afraid you would have to have some contractors build some,” he added. While builders of spec homes were left holding the bad a few years ago as the great recession began, “I think now they would have a little better luck if we were to get some new jobs. I would guess everybody’s sitting tight.”

Scheetz thinks that Logansport hasn’t had the growth to justify building spec homes, however. The cost of building materials means even a 2,000-square-foot home — a common size for a three-bedroom house — would cost about $200,000 to build.

“It’s kind of a catch-22,” Scheetz said.

Finding an existing home that’s ready to move in can be done — in the Rogers’ case, it took six months of scouring the local multiple listing service daily and making offers in short order.

In most cases, the couple was a day or two too late to make an offer, but they did succeed in buying a house last May.

“When we did finally get our home, it was about the same thing, only we were the faster ones,” Peter Rogers said.

Sarah Einselen is news editor at the Pharos-Tribune. She can be reached at sarah.einselen@pharostribune.com or 574-732-5151. Twitter: @PharosSME