A lack of starter homes may be one of the issues the city will need to address as it deals with its affordable housing shortage.
The city hired a consultant to complete a housing market analysis, which includes a survey of residents, employers and landlords. Jen Garner, of BBC Research and Consulting Inc., shared some preliminary data from the survey with members of the Affordable Housing Advisory Board Monday at the board’s meeting.
Garner said about 60 employers were surveyed, and 70 percent of those said it’s hard for people to find housing to buy, especially for entry-level and hourly workers. In addition, 20 percent of the employers surveyed stated they have had trouble recruiting employees in the last couple of years because of housing conditions in Lawrence.
“We’ll dig into some of the whys behind that,” Garner said. “For some, that might be tied to not having starter homes on the market.”
Garner said BBC would look deeper into the data as the study continues, and more information — including input from focus groups and data collected from online rental advertisements — would be included in the final report.
Garner asked board members what price points they thought were most in demand. Board member Thomas Howe, who represents the Lawrence Board of Realtors, said there is less than a month’s worth of inventory of houses under $200,000, and that those houses are selling quickly and for more than their asking price.
“Buyers at that lower price point are frustrated by their ability to find properties that work for their budget and that they can actually buy,” Howe said.
For example, Howe said a house in that price range that went on the market on Friday had 25 showings and received six offers over the weekend, and it sold for substantially more than the asking price.
Board member Tim Stultz, who represents the Lawrence Home Builders Association, provided his point of view. Stultz said that new smaller homes can’t be built at market rate.
“There is no way you can build a 2,000-square-foot house for under $200,000,” Stultz said.
When Garner asked Stultz what is driving that, he said there is no magic bullet and that every line item has something that costs a little bit more. The most expensive cost, he said, is the cost of land in Lawrence.
Consultants surveyed about 400 landlords, and Garner said that preliminary survey data also indicated that some rental units were leased fast. Garner said half of the landlords surveyed said that their available rental units leased within a week.
“That’s quick,” Garner said. “We’ll be able to dig into that and look at which types of units went fast. Do we have some that linger on the market?”
One of the questions asked of residents was whether they have had to move out of a home in Lawrence in the past three years when they didn’t want to move. Twenty percent of renters with children responded that they had, as did 14 percent of seniors and 8 percent of renters overall; the latter, Garner said, is a good number compared with other cities.
Garner said families with children that are displaced tend to be less resilient economically. For the displaced families with children, 42 percent said they had to leave because of a rent increase or because they couldn’t afford to stay, and 27 percent because of the cost of utilities. In reference to utilities, Garner said it’s a reminder that more than the cost of the structure itself affects housing costs.
“As we think about what creates sustainable households, what helps people at the margins, sometimes, it’s not just the rent that’s the issue,” Garner said. “It’s that I’m living in a unit that has little to no weatherization, maybe has really leaky windows.”
Consultants surveyed about 2,500 residents, Garner said. She said about 475 were surveyed via phone and that those represent a statistically valid random sample. The other responses were received via an online survey. She said, as a deeper analysis of the survey data is conducted, it will be separated into additional categories, such as household income and other demographic information, such as disability.
The preliminary data from the housing survey is available on the city's website, lawrenceks.org. In October, the Lawrence City Commission hired BBC Research and Consulting Inc. to conduct the comprehensive housing market study. The study will collect and analyze data on the city’s housing market and provide recommendations for addressing the city's affordable housing shortage.