November 5 – According to a Thrive West Central housing survey, more new housing construction is needed in a seven-county West Central Indiana region to replace an old housing stock.
Thrive West Central announced in May that it was undertaking the study and has now published its results.
“Thrive’s Housing Analysis provides important insights into West Central Indiana about our current housing climate,” said Ryan Keller, executive director of Thrive.
The study, released last week, found:
* There is a discrepancy within the housing market. Not only are there not enough housing to meet a conservative estimate of future demand, but the region is also currently significantly over-supply in the lower half of the market, i.e. homes sold for less than $ 150,000 or rented for less than $ 1,500 a month, and supplied in the upper half.
* A significant portion of existing lower-end housing is in poor condition and in need of repair or replacement.
* The market is not supporting enough new construction of the right variety, largely due to the fact that the high cost of new homes is difficult to sustain in a region with median incomes that lag much behind the state.
* Demographic changes will drive the future housing market as the baby boom generation fully reaches retirement age in the next decade.
The study looked at the counties of Vigo, Clay, Parke, Sullivan, Vermilion, Putnam and Montgomery. Montgomery County was included as the county petitioned to join Thrive West Central. The county has not yet been approved by the Indiana Economic Development Administration for coverage by Thrive, said Kris Krueger, Thrive’s acting director of economic and community development.
The study finds that the region’s population has been largely stagnant over the past century, “more worryingly, the number of residents has declined by 2.3% over the past 10 years, mainly due to the migration of residents out of the region. reversing the slight increases from the 1990s and 2000s. On its current trajectory, West-Central Indiana is projected to continue to steadily lose population over the next 30 years, decreasing by nearly 5% by 2050 unless the trend is not reversed “.
This means that the tax base is reduced and the number of services, supported by taxes, would also be reduced.
The study also states that, in addition to a declining population, the region is facing an aging population, as the share of residents aged 65 and over is expected to increase from 17.4% in 2020 to 21.2. % by 2050.
The region had 115,768 housing units in 2020 and “is roughly in line with each county’s share of the total population,” the study says. About 71% of homes in the region are owner occupied and 29% rented. This employment rate is below the national level of 36% and below the state level of 31%.
Vigo County has a renter occupancy rate of 37%, “probably explained by Vigo County’s large student population and lower average incomes, two categories of people with a greater tendency to rent due to financial need. or the desire for flexibility “.
Housing in the region “tends to be older on average, with 24% of housing in the region built in 1939 or earlier, which is 7 points (percentage) higher than Indiana’s share and more than double the States’ share. United by 12% The study states that about 4,992 units (4% of housing) have been built since 2010.
The breakdown by region shows that 24% of the houses were built in 1939 or earlier; 16% built from 1940 to 1959; 24% built from 1960 to 1979; 22% from 1980 to 1999; 10% from 2000 to 2009: and 4% from 2010 onwards.
Terre Haute Mayor Duke Bennett in his February update on the city said the city has demolished 835 residential properties since 2008, with plans to demolish between 80 and 90 condemned properties using the city’s authorized financing from housing. and urban development in the United States. This demonstrates a continuing need to build new homes in vacant lots.
The study said median incomes in the seven counties are below the national median, with the exception of Clay and Putnam counties which have median incomes above the state level. About 15% of the region’s residents – more than 35,000 people – live below the federal poverty level and struggle to meet basic needs, including housing, based on US census data.
The study points to some statewide projects that have been built to attract new homes, such as in the city of South Bend.
In 2022, South Bend announced a program to help build the city’s vacant lots. It includes the waiver of a utility construction tax where five or fewer homes are built, with some developments being funded by low-income housing tax credits or by a non-profit organization. The program also offers reimbursement of up to $ 20,000 for the costs of connecting the side sewers to low- and moderate-income homes.
Other instruments include the Residential Tax Increase (TIF) financing, signed into state law in 2019, which allows redevelopment commissions to create TIF districts for residential real estate to stimulate new housing construction.
There are also rehabilitation loans and home rehabilitation grants from the USDA, Indiana Office of Community and Rural Affairs (OCRA), and Indiana Housing and Community Development Authority that communities can use.
The full analysis can be found on the Thrive website at thrivewestcentral.com/housing.
Howard Greninger can be reached at 812-231-4204 or [email protected] Follow on Twitter @TribStarHoward.