photo by: John Young
I like touring new homes, but I don’t like helping new homeowners unpack their boxes. I was worried that might be the scenario confronting us at this year’s Spring Parade of Homes.
That’s no longer a worry. The Lawrence Home Builders Association has made the decision to cancel this year’s Spring Parade of Homes. The reason is simple: There are so few homes being built in Lawrence that those that are completed likely would already have people moving into them by the time of the tour.
“Lots of new homes are sold before the construction is done, and if they aren’t, they are going to be sold before the tour will start,” Bobby Flory, executive director of the Lawrence Home Builders Association, told me.
The spring tour normally took place the last week of April and the first week of May.
For years — the event has been going on for a couple of decades — the tour has been mutually beneficial to home builders and home buyers, plus those who are just curious about design trends and other such matters. Builders have put their “spec” homes on the tour, meaning those that they built without having a buyer already lined up. Home buyers got to see a bunch of houses at once and sometimes talk with the builders themselves.
But all of that was happening in a more normal real estate environment, when homes sat on the market for a month or more before selling. Many homes in Lawrence are now selling in five days or less, according to statistics from the Lawrence Board of Realtors.
“A builder understandably is not going to put a house on a tour that they know will be sold before the tour begins,” Flory said.
But why aren’t more new homes being built in Lawrence? After all, it seems like the number of potential buyers far exceeds the number of homes for sale.
While there are some national issues with supply and costs of building materials, Flory said the larger problem was a shortage of vacant lots in Lawrence.
City commissioners really have emphasized that they want new home construction to happen on “infill” lots, rather than annexing large areas of land on the outskirts of the city. Flory said builders have been trying to comply with that desire, but it has been difficult to accomplish and is becoming even more so.
“The low-hanging fruit has been or is in the process of being built on,” Flory said of available lots that already are in the city limits.
In the past, city officials have pushed back on the idea that there aren’t enough available lots in the city limits to handle current demand. A 2020 City Hall-produced report estimated there was at least a two-year supply of vacant residential lots in the city limits. The city, however, hasn’t posted a report for 2021.
Builders previously have been critical of the city’s past reports, saying that they were written too much from the 20,000-foot level and didn’t take into account the actual conditions on the ground. In some cases, those conditions mean the actual condition of the ground. Is a lot too rocky to feasibly build upon? Is it too steep? Does it have some other topographical feature that makes it difficult to build upon?
“If it hasn’t been built upon by now, there is probably a reason,” Flory said of the vacant lots that have been cataloged by the city.
Now, builders and Realtors have been lobbying more loudly about the need for City Hall to annex more property into the city limits that can be easily developed as new neighborhoods. More recently, their lobbying has taken on another element: They want the city to help pay for some of the infrastructure that would be needed to build new neighborhoods. The general public often thinks the city already pays for all the streets and sewers and other such infrastructure of new development. That’s not really how it works. The city sometimes finances the costs of that infrastructure, but the developers — or ultimately the homeowner — makes the debt payment on those infrastructure costs through special assessments on their property taxes.
But now, builders and Realtors are suggesting that the city pay directly for some of those infrastructure costs using dollars the community has received for infrastructure as part of the federal pandemic relief package.
“The thing that we need is for the city to be a partner in the expansion of the infrastructure,” Flory said.
Flory said such a partnership would be appropriate because the lack of residential lots in the city isn’t just a problem for builders. A lack of lots is contributing to the city’s overall affordable housing problem. A lack of new homes for buyers to choose from is pushing up the value of all existing homes in Lawrence.
“This is not a builder problem,” Flory said. “It is a community problem. If we can’t provide housing for the workforce and meet the demand of buyers, Lawrence will struggle to be successful from an economic development standpoint.”