News and notes from around town:
• A major East Lawrence affordable housing project is reaching a critical juncture. So, what else is there to do but throw a party? A more than $7 million project to renovate the former Poehler grocery warehouse building into 49 units of affordable housing will find out sometime next month whether it has been awarded state tax credits. Tony Krsnich, the Kansas City-area developer trying to put this deal together, is planning a party of barbecue, beverages and a band from noon to 4 p.m. on Saturday, May 7 at the Poehler property, 619 E. Eighth St.
“From everything I have heard, the community really wants this building saved,” said Krsnich, who specializes in converting old buildings into affordable apartments, including the old Chatham Hotel in Kansas City. “We’ve been welcomed with open arms. That’s why we’re doing this. We just want to say thanks and answer any questions about it.”
I’m also surmising that Krsnich is hoping to show leaders at the Kansas Housing Resources Corp. — the group that issues the tax credits — that there is a lot of community support for the project. Krsnich said he’s hoping to attract 200 to 300 people to the party. Showing community support could be important because it looks like the competition for housing tax credits in Kansas has really heated up. The corporation recently announced that it has canceled its second round of applications for the tax credits in 2011 because the first round created such a large pile of applicants.
The tax credits are critical to the future of the project, Krsnich said. The tax credits basically serve as a way to get these affordable housing projects financed. The state issues the credits for 10 years to a group like Krsnich’s. His group then sells the credits to individuals and businesses who want to reduce their tax liability. Usually, the credits are sold for 65 cents to 75 cents on the dollar. The group then uses that money, combined with its own investment, to build the project. I’m guessing that in this time when banks are being very tight with their money, the tax credits are drawing more interest than ever.
Krsnich said he thinks the project would be great for East Lawrence. Plans call for 33 one-bedroom and 16 two-bedroom apartments in the four-story building. Because it is being financed by tax credits, the state puts restrictions on the amount of rent. Krsnich is estimating that the average monthly rent for a one-bedroom unit will be a little less than $500, with a two-bedroom just a little more than that.
• New numbers from the Lawrence Board of Realtors indicate the spring home buying season sputtered a bit in March, especially when it comes to people buying newly built homes. The board’s numbers show 82 homes sold in March, down from 86 in March 2010. Sales of newly built homes, however, tumbled by 77 percent from nine in March 2010 to two in March 2011. Both existing and new home sale totals also are down from March 2009 levels.
But for all of 2011, the numbers aren’t bad. During the first quarter of the year, total sales were up 5.5 percent from a year ago. Sales totaled 193 from January through March, up from 183 during the first quarter of 2010. They also are well above 2009 1Q totals, when 170 homes had sold.
But newly built homes are selling at a slower pace. Nine newly built homes sold in the first quarter, down from 16 in the first quarter of 2010.
Prices appear to be on the rise. The median selling price for a home in 2011 thus far is at $155,000. That’s up from $142,500 during the same period a year ago. Of course, always be careful about reading too much into that because the types of homes that have sold in the beginning of 2011 may be different from the size and style of homes that sold in the beginning of 2010.
• The fine folks at McGrew Real Estate, who of course keep a close eye on the market, have put out their annual Lawrence real estate report. Probably the most interesting part of it is the review of home sales and prices for the decade. To put into perspective how far the real estate industry has fallen, consider this: In 2000, real estate agents in Douglas County (not just McGrew’s) sold $207.6 million worth of homes. In 2010, that number had fallen to $203.9 million. There are quite a few people in Lawrence who make their living off of a real estate commission check. These numbers tell me that they’ve taken a sizable pay cut, which has had implications on Lawrence’s broader economy.
The decade in review also highlights that home sale totals fell six years in a row, from 2004 to 2009. They were up 11 percent in 2010, certainly in part because of the federal home buyer tax credits. Everybody is watching 2011 sales totals to see whether that momentum can be sustained now that the tax credits no longer are being offered.
Here’s a look at some of the numbers by the decade:
- 2000: 1473 sales totaling $207.6 million. Avg. sale price $140,942
- 2001: 1609 sales; $237.4 million; Avg: $147,598
- 2002: 1580 sales; $247.5 million; Avg: $156,686
- 2003: 1749 sales; $292.6 million; Avg: $167,324
- 2004: 1726 sales; $301 million; Avg: $174,445
- 2005: 1702 sales; $315.9 million; Avg: $185,620
- 2006: 1538 sales; $295.0 million; Avg: $191,818
- 2007: 1431 sales; $288.2 million; Avg: $201,452
- 2008: 1066 sales; $208.7 million; Avg: $195,858
- 2009: 981 sales; $187.9 million; Avg: $191,583
- 2010: 1086 sales; $203.9 million; Avg: $192,455
• One last real estate tidbit. You’ve heard the saying location, location, location. Here’s a look at how that plays out in Lawrence. According to the McGrew report, here’s how homes sold in different areas of town in 2010:
- West of Iowa north of 15th Street: 347 sales. Avg. Sale Price: $214,852
- West of Iowa south of 15th Street: 159 sales. Avg. Sale Price: $210,206.
- East of Iowa north of 15th Street: 129 sales. Avg. Sale Price: $167,907
- East of Iowa south of 15th Street: 197 sales. Avg. Sale Price: $151,611.