Culver

Affordable Housing Task Force

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The Affordable Housing Task Force met on Monday the 27th to discuss the information Jonathan Leist, Culver Town Manager, had assembled through various meetings.  I attended four of the six meetings he reported on and was able to help fill in background.  In a nutshell, there are opportunities and developers that can be enticed to do work.

In a MCEDC site visit with Elkay, we were able to recruit Elkay’s management to assist us in our endeavors.  Two Elkay representatives attended the Monday meeting and brought demographics for our use.  They also volunteered to help with surveying to determine how many Elkay employees would be interested in relocating to Culver if housing were made available.

In the meeting with IHCDA, we learned that funds are available, but only for income based housing projects, not market based housing.  We did find that much of the projected income based rental rates are actually above the local market rate rents.

The Task Force agreed that it would be prudent to pursue both market based and income based housing to keep our options open.  The group tasked Jonathan to take a couple of things before the Town Council:  1)  A budget for a Needs Assessment Survey and 2)  A tentative agreement to consider tax abatement for the properties.  (Tax Abatement was requested by all of the developers Jonathan met.)  Jonathan accomplished #2 at last night’s Council meeting, but #1 was not approved as it would require an additional appropriation for the unbudgeted cost.

Image Source:  www.homeloanstoday.com

 

Marshall County Entry Level Housing Meeting

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I sit on the Affordable Housing Task Force for Culver and as part of that as well as wearing my MCEDC hat, I sat in on a meeting at the Culver Library with Darin Edwards, Underwriting and Closing Manager for IHCDA.  The meeting was arranged by Jerry Chavez, MCEDC Executive Director, and included representatives from the Marshall County communities of Culver, Argos, Plymouth and Bremen.

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Kathy & Will Peason’s Retirement Party

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Will & Kathy Pearson with over 60 combined years at ECC

We had a retirement party for Will & Kathy Pearson on Saturday night.  Kathy was with Easterday Construction for over 38 years and Will was here somewhere around 25 years. As discussed in a previous post here, they will be missed.

Almost everyone in the crew was able to come out for the party.  We shared a lot of memories and everyone had a good time.

Smaller Home Sizes

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My post regarding Starter Home Barriers sparked some conversation about the square footage of a starter home, particularly regarding the 2,000 minimum home size discussed in the Builder magazine article.  Many of the points about that possibly being unrealistically large for Culver were valid.  Since I was paraphrasing the article in the previous quote, it seemed appropriate to stick with their numbers and rationales.

3 bedroom/2 bathroom home Plan by Zero Energy Design

In any case, the discussion prompted me to do a little further research into smaller home sizes.  I did find the Zero Energy Design website which included several smaller residential footprints ranging from a 1 bedroom/1 bathroom at 624sf to a 3 bedroom/2 bathroom at 1120sf.  (Apparently in a ZED home no one watches TV as they don’t even appear to allow a place for one in their room furniture layout.)  While I know the boxy design is the most efficient, I would hope we can be a little more creative in our floor plans.

1-1/2 story house with porch and dormer from Hermann London

I also notice that almost all the small footprint homes are single story.  I don’t know if that’s because they are often geared towards the elderly and are trying to make them as accessible as possible or if there is just a predisposition to single story now.  Going back to a story-and-a-half design could provide some additional efficient space.  The boxy design lends itself well to prefabricated construction, but we have had good success with panelized construction which is also efficient where duplication of layouts is possible.

I think the infrastructure issues will be more telling than the house floor plan in what the end selling or renting point is.  As with their square foot home size, I think the lot buildout may be more economical here, but probably not by much.  Many of the same regulations apply and our Comp Plan pushes more measures such as “complete streets” which add costs.

Starter Home Barriers

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Builder Magazine Cover - March '15As a way to track my thoughts and findings on Affordable Housing, I plan to continue posts here under the tags of “Affordable Housing” and “Sand Hill Farm“.  This will include my thoughts and recollections from Culver’s Affordable Housing Task Force meetings.  That way anyone interested in my take can follow along.

In that vein, I just read an article in Builder magazine titled:  “Are New Starter Homes History?”  I found some interesting take-aways from the article.  Two of the biggest are that they consider a home under $200,000 a starter home and that the general rule for starter homes is 2.5 time median household income, which according to our last Affordable Housing Task Force meeting puts a starter home in Culver at $113,000.  That’s not happening by any stretch of the imagination without serious subsidizing.  Here are some other take-aways from the article:

  1. Making a $200,000 home work is Junior-high-level math.  Solving for 20% profit – Land and building direct costs cannot exceed $160,000.
  2. The lowest build cost is around $50 a foot. To be competitive with existing stock, you need a 2000 sf home which gives you $100,000 for bricks and sticks and $60,000 for the lot.  (That is a price for a developed lot with all the infrastructure, e.g., water, sewer, storm, streets, sidewalks, street lights, etc.)
  3. Metrostudy guidelines say estimated price per bulk lots has gone up from around $50,000 in the recession to over $80.000.
  4. Even if land can be secured at a reasonable cost, cash-thirsty localities heap fees upon fees that weigh more and more heavily on the final home price.
  5. Residential material costs have risen 45% in the last decade.
  6. One way to reduce per lot land costs is to increase density.
  7. Value engineering can bring down costs at the expense of amenities, i.e. build a no frills box.
  8. One question is does today’s starter-home buyer – a millennial adult more often than not  –  want to move into a boxy, no-frills home with Formica and vinyl after living in high-tech student housing and ritzy apartments.  The expectation of what a customer thinks an entry level house is can be crazy.  They want granite countertops, tile backsplash and stainless steel appliances.
  9. There are political ramifications to introducing lower-income citizens into established communities.  Entry-level buyers new to the neighborhood take the not-in-my-backyard hit.

A lot of these are tainted by location.  The commentary about millennials as the target may not be the same here, but when we target starting teachers, we may run into that mindset.  Some of the expectations for the subsidized housing that Culver Academies provides gives credence to this mindset.

Home Image Source:  Duane Sala Construction