On this episode of the Post Podcast Grow Hays executive director Doug Williams shares information about a Hays housing report.
Transcript:
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James Bell
A housing study completed earlier this summer in Hays is about to be released and an upcoming Grow Hays quarterly luncheon will share some of those results. Executive Director Doug Williams stops by to give us a preview on this episode of the Post Podcast.
Grow Hays executive director Doug Williams
We're gonna have our quarterly luncheon it's gonna the topic is going to be this housing study will be on September 6, September the sixth the day after Labor Day.
James Bell
Okay, very good. A lot of interesting stuff in here. And I don't think we're gonna get to even a fraction of it. But maybe I think maybe a good way to start is what's uh, what's the overview? Is it good news, bad news. So how we look at?
Grow Hays executive director Doug Williams
Well, I think it tells us what we already know that we have housing shortage in Ellis County or in Hayes. This is specific to Hayes, but it extends beyond Hayes and Ellis County. And it just kind of verifies that it talks about how we compare to other communities. We're certainly not alone with the our housing woes in Ellis County. But it also tells us why we have housing prices like they are which are higher than they maybe should be. But also, more importantly, looking forward, it tells us that what i The biggest thing I glean out of it is it tells us what we need to be building per year, at certain growth levels in our community. And the fact that we have put ourselves in a deficit of the number of housing units that we have, and how many we need to build on an ongoing basis.
James Bell
Yeah, that was one of the things that I was under is trying to find it in here. Because it's you know, it's a 50 page document. But I was trying to find the numbers, that it really it did seem like if we don't get on it now, and I know a lot of people are working on this, but we're going to be it's going to be a growing problem. If you don't take action now, which we've talked about over and over and over again in the segment, the actions come and it's just slower than we want,
Grow Hays executive director Doug Williams
why it's slower than it than we can afford it to be, is the problem at 1% growth. The city of Hays needs 88 new units per year. We haven't built 88 units in a year, we got close, I believe in back in 2013. Since then, we've been in the 25 to 40 range per year, which has created this deficit that we have, which I talk about from time to time, you know, we've got a three to 400 unit deficit in this community in terms of housing units, and that's single family residences, apartments and that kind of thing. And I have people all the time to me, Doug, you're crazy, there's no way that we're three to 400 units short, but the reality is we are. And what's that's resulted in is missed opportunity. We've had people that maybe wanted to move to this community or would move to this community, but haven't because we don't have sufficient housing. And then we have people living in substandard housing, that they really shouldn't be living in. And if they had alternatives, they would choose not to live in that housing. So you couple those two things together the missed opportunity, as well as the people living where they maybe shouldn't, as well as housing be more expensive than it should be. All of that is a function of supply and demand. And we don't have enough supply. And we have the demand for it. So we put ourselves in a tough spot. And we've chosen the worst time in the history of construction to try and work our way out of this problem. So it's a challenge, but we just have to figure out how to overcome it.
James Bell
Yeah, you know, one of the conversations I hear pretty regularly and this taken us out of the survey a little bit, but over and Victoria, about the right size, they've had a lot of seniors in big houses for five bedroom houses that would love to be in a smaller setting. But they don't have anywhere to go and they don't want to leave Victoria. So they're stuck in these houses. And then the families don't have the opportunity to move in and no constructions really going on in a large scale anywhere over there.
Grow Hays executive director Doug Williams
Right that that real problem in smaller communities. And appropriate housing is another thing that this this housing study tells us that retiree friendly housing, more affordable housing on the lower end, both are in strong demand. And we've got to figure out ways to meet that. Now fortunately, the one opportunity exists the state of Kansas has come out with some programs that are focused on communities 8000 And under, where they have some grants and that type of thing. And we're going to we're working on trying to figure out how we take advantage of those. But the other challenge is is builders and subcontractors that can can meet the demand. We these guys are as busy as they can be. They're They're backed up for months. And so the thought process of going in and starting new construction, when a framer may not be available or the electricians are backed up and that kind of thing. Make it a challenging building environment as well, whether it's in Hayes or Ellis or Victoria, or wherever, but we just we just got to figure out a way. You know,
James Bell
one of the other things that I thought was interesting in this is the the financial bet. And I mean that by household income to housing. And I wonder if you can speak to that a little bit? Or are we out of whack in that department as well? Or are we okay, here, no one's counting for that.
Grow Hays executive director Doug Williams
Now, we're housing is too expensive here relative to median family income. And so that's a problem. We don't have enough housing that is priced appropriately for the level of income that we have, and in many cases, so that's a struggle, that's also a function of supply and demand. You know, you can go back to that. And, you know, you I, I chuckled, when I sometimes read in social media that, you know, the realtors have driven the price up on houses, that's the most ridiculous thing you could ever think because they don't, they don't set the
James Bell
price to say yeah, like, well, they don't have any control over that, really, it's what people are going to pay. It's
Grow Hays executive director Doug Williams
the marketplace and supply and demand. And while we would like to think that that's not the case, it is. And until we add more supply to the market, this demand is going to drive prices up. Now, we've had another outside factor that's affecting our market as well. And that's interest rates have risen considerably over the last six months to a year. And that's making affordability more difficult as well, making new construction more difficult. And so just one more thing we have to deal with and try and overcome.
James Bell
Yeah, you know, you mentioned the interest rates. And that is something else I wanted to get into today, we heard a little bit on the news this morning. And our news breaks, there was a study come out or story by the New York Times, and they were highlighting the drop in the sales because of the interest rate. And it looks like I've got the number here. 5.9%. Last month, home sales dropped. And that's a national number. But I wonder how much of that is actually impacting local sales and real estate.
Grow Hays executive director Doug Williams
What is and talking to local realtors, you know, last February, I think we had as low as maybe 10 homes on the market. Now it's more in the 40 to 50 range, I think. So that's a function of interest rates, certain people get priced out of the market, the challenge is they have to live someplace. And so they're just priced out of maybe buying a home. But that puts additional pressure on the rental market. And we have not added many new units to the rental market. We do have a project there St. Joseph school, you know, that's going on. And Michael Graham is putting in 36 units down behind the old Washington School, those will be rental units added to the market, we have a duplex here, a duplex there that are being added. And so that helps somewhat, but we haven't had anybody build a complex in our community for a long, long time, like what Michael Graham is doing, or even, we are talking to a couple of developers outside the community that are considering larger complexes, 80 to 200 units, which would be great. But they face the same challenges, they've got to find people to build them. And then they have to be able to build them at a price point where they can make it work. And unfortunately, that with construction costs where they are, that's difficult to do too. So there are no magic bullets. And there's no silver bullets in this situation. It's a challenge.
James Bell
You know, I'm curious, why don't we have more of those in Hayes hour and Ellis County, I would think, you know, I can think of two or three of those larger apartment units. But how can we have just built those over the years, like you see in some other especially I think college towns,
Grow Hays executive director Doug Williams
I think it's a function of the willingness for local developers, local builders to take on that level of a project, you know, a couple 100 units, you're talking, it's costing 150,000 plus per unit to build right now, some big muscle, if you're gonna build 100 units, that's $15 million, you're gonna build 200 units, that's $30 million at $150 per doors, that is the terminology they use in the industry. And there just aren't many local developers investors willing to take on that level of, of risk and that level of a project. And outside investors typically are leery of communities our size, we think we're larger community, college town, that kind of thing. But they're looking at Wichita, Kansas City and that type, you know, Lawrence, Manhattan, even for those type of projects, we have a hard time attracting outside investment. And so that combination makes it the fact that we just don't see many of them in our community. We don't see any of them in the last long period of time.
James Bell
Yeah, so I you know, I'm curious, we get it. We talked about the problems. Wait, how do we how do we move forward? How do we use the data that's in this the survey to push us into where we need to be?
Grow Hays executive director Doug Williams
Well, we have to have an organization, you know, part of our responsibility that I view is is driving Housing, Construction, driving things and understanding the programs that exist that the city, the county, the school district can offer like RH IDs, and some of these moderate income housing grant programs, and utilizing those tools, towards the construction of property and finding land, and property owners that are willing to sell at a price that will make these things feasible. We're working on as I said, we've got probably three or four different projects, I guess, I wouldn't even call them projects, I call them concepts, that at various locations around the community that that really, we would like to make happen. We're working with potential developers. But you know, of those three or four we're working on, if we get one to happen, it would be a great because they're challenging, they're, they're expensive, and they're hard to make work financially. Also working with not for profits, like heart of America and what they did at Easter, the technical college, that's that's a win win the the ultimate winner in that scenario are the people that are living out there, the homeowner, and we need to utilize not for profits, if we can for maybe apartment construction, where the ultimate winner is the tenant? You know, that's the type of construction we need to focus on. And we are it's just, it's just complicated.
James Bell
Sure. You know, we talked a little bit about the nonprofit's before we want to honor on air as well helping out with them. I wonder if you want to share the What's that? What's the role in those organizations? Like we've talked about a heart of America with your 22nd, Wheatland development, you know, how much are they going to be able to drive this in the coming years,
Grow Hays executive director Doug Williams
they need to be a part of it, they can't be the total solution, but they need to be part of it. You know, those organizations that are dedicated to community good, and are not necessarily profit motivated? You know, I look at, we've got an opportunity here, we've got outside investors who come in, and they're pretty much their motivation is profit. They want to make money, I get that that's, that's great. Well, I wouldn't be in business for long if you didn't, right. But the profits they do make, where do they go, they leave the community, the long term profits that they make, when they sell or whatever, they leave the community. And then you've got local investors, who they're, they're out this, they're in this to make a profit as well, again, that's good. And the good news there is the the operating profits and the long term profits that they make, they stay in the community, they buy cars, they buy furniture, they spend their money locally, that's great. And then you got the not for profits, who are not in this to make money, they're in this for community good. And if we can figure out ways to assist them with some of these programs, and if they're willing to take on some risk and projects, that can be a part of the solution as well. And we're absolutely working with those organizations like Heart of America, and trying to make some of these things happen.
James Bell
When I think it would be true as well, that those local developers, those local nonprofits, they're going to have a lot more interest in hiring local contractors, people locally, they can actually make the project come off the ground.
Grow Hays executive director Doug Williams
Sure. I mean, they're focused on the community, they're focused on community good, and, and that's great for the community, they can't be that they can't be the only solution. They just need to be part of it. And so that's what we're trying to do.
James Bell
You know, how much of this also is, is just finding that help finding those people to do that
Grow Hays executive director Doug Williams
work? Well, that's a big part of it right? Now. We hope we work our way out of that. And, you know,
James Bell
we build the houses, then we get more workers, then we can build the houses,
Grow Hays executive director Doug Williams
right? I mean, it's one of those kinds of deals, but we're gonna fight that for a few years here. I think I don't think there's any quick fixes to that. You know, everybody always says, we'll just get somebody come out of town to do that, you know, framing company from out of town. It's not that simple, because they're all busy where they're at, too. And there's, there's there's a lot of demand. But bit by bit, I think we can work ourselves out of this situation. We can add units to the marketplace. But it has to be a proactive thing. We do we did. It clearly has not happened on its own, just with the marketplace supplying this. We've got to be more forthright in our efforts to make this happen. Because just waiting for the market to correct itself has not worked yet. So we've got to we've got to force some things to happen.
James Bell
Okay. Well, Dave, we've got just about a minute left. Before we got to get over the news. But you can hear more about this at the quarterly luncheon. I wonder if you want to share with everybody like what do they need to do if they want to get involved and hear more about this at that event? Well, we're
Grow Hays executive director Doug Williams
going to post this study on our website at grow hayes.com For one thing, so they can go out there and read it and we'll put it out on our Facebook page. And then the quarterly luncheons, they're open to the public, we just ask that you call our office and And RSVP. So we know how many people to get food for. We can handle about 40 to 45 people. So once we fill up, we do fill up, but we ask that you do RSVP, you know, call our office to reserve a spot and, and we'd love to have a good cross section call and Belzer assistant city manager is going to be doing part of the presentation. I'm going to pitch in on some of the things that we're doing. So it should be pretty interesting, and we'd love to get feedback from it.
James Bell
Do you still do the online portion of that as well?
Grow Hays executive director Doug Williams
We will we will do a zoom deal that we'll put out there and our website and Facebook page if some people want to attend the Zoom
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