Single-family home construction in Lawrence is at its lowest point in the last 66 years, new numbers show
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The latest numbers show 2022 was the slowest year for single-family home construction in Lawrence since at least 1956.
The city issued building permits for just 79 single-family homes, a fact that is likely to put pressure on the Lawrence public school district, which last decade saw its enrollment decline. As a result, the district has been having near continuous conversations about closing several neighborhood schools, despite strong pushback from parents.
The numbers also likely won’t be helpful in the city’s battle to bring down the price of housing in the community, as a lack of new houses will limit the supply of homes on the market and give sellers an advantage over buyers.
“I’ve said it before, but the way we are going to get more affordable housing is to build more housing,” Bobbie Flory, executive director of the Lawrence Home Builders Association, said in reaction to the year-end numbers.
The latest report shows 2022 is a low water mark on that front. The city has been keeping reliable building permit numbers since 1956. The 2022 results mark only the second time since 1956 that Lawrence has started fewer than 100 new homes in a year. The only other time was in 2011, when local builders started 95 homes.
Lawrence — a community that for 11 consecutive years in the 1990s and early 2000s built more than 300 single-family homes a year — now is building fewer homes than significantly smaller communities, such as Spring Hill, Gardner and Shawnee.
The slowdown in single-family home construction has meant different things to different people in the community. For people who already own a home, many have seen their wealth increase as their home values have increased at rates far above the historic norm. But, so too, have the property tax bills owed on those homes.
For renters, the impact perhaps has not been much. Lawrence has seen its apartment ranks grow mightily. During the last decade, there were 2.6 apartments built for every single-family home constructed in the city. That trend continued in 2022. There were permits issued for 206 apartments versus 79 single-family homes in the year.
Perhaps the group that is feeling the most impact from the housing slowdown is new residents with families who want to live in the community, but don’t want to do so in an apartment. That seemingly is a key demographic for the Lawrence public school district.
As the Journal-World reported in March, the Lawrence school district is facing an odd situation with its enrollment: During the last decade, Lawrence’s population grew by 7%, but the school district’s enrollment declined by 4%.
Such numbers caused longtime school board member Shannon Kimball to ask “what’s going on in our larger community?” One answer, of course, is that Lawrence is growing its population with retirees and young residents who haven’t yet started families, or maybe never will.
That scenario, though, creates another question: Why isn’t Lawrence attracting those families, especially when other nearby communities are? Eudora, just six miles to the east, saw its overall population grow by 4% last decade, but its school enrollment increased by 8%.
Lawrence, it seems, needs to find the answer to one of two key questions: Is Lawrence not building single-family homes because families to fill them are no longer attracted to the city? Or, are families no longer attracted to Lawrence because there aren’t enough single-family homes being built to house them?
Flory, the representative for local builders, said the answer should be obvious at this point.
“We have a shortage of single-family homes, period,” she said. “There are families that would like to live here and can’t because they can’t find housing.”
It is an important question, so I would like to hear some other perspectives. I reached out to Kimball at the school district and the mayor and vice mayor at City Hall, but wasn’t able to make a connection on Thursday afternoon.
But there are some other numbers that do suggest a shortage of homes is a fact in Lawrence. Perhaps the strongest is that the median number of days a home sat on the market in Lawrence before selling was four. Another number of note is that the number of homes sold in Lawrence declined by 13% in 2022, but the median selling price for Lawrence homes increased by 10%. That’s an indication that demand is still outpacing supply in the market.
Why can’t supply catch up? Flory and her organization for years have been saying it is because the city does not have an adequate supply of building lots. The home builders and real estate professionals have contended the city is too restrictive in allowing annexations and the creation of new neighborhoods.
In fairness, the city has approved some new development. Late in the year, the City Commission approved a new development just south of the Kansas Turnpike that eventually could accommodate about 140 new homes. But, early in 2022, the Planning Commission effectively killed a 400-home project north of Rock Chalk Park by voting to recommend its denial.
Flory said her organization in the last month or so has started to see signs that City Hall leaders are becoming more receptive to approving more residential projects. The area that seems to be getting a lot of attention is the property just west of the Bob Billings Parkway and South Lawrence Trafficway interchange. There is enough vacant land there to accommodate a thousand or more homes over time, but getting city water and sewer lines under the SLT will be expensive. I’ve heard estimates of $10 million to $15 million, and I’m not sure that is a full accounting. Expect any developer looking to develop there to ask for significant city funds to help with that infrastructure extension. Such requests haven’t always gone over well in some Lawrence political circles. It will be interesting to watch whether attitudes have changed now.
“I’m very hopeful that happens,” Flory said of a builder/city partnership after having recent conversations with city officials.
But don’t expect a neighborhood to pop up west of the SLT anytime soon. Any infrastructure work likely would not happen until construction to widen the SLT to four lanes is underway. That means we are looking at a couple of years at least before you would ever see homes on the market.
“That is where we are, and it is really frustrating because we saw this coming a couple of years ago,” Flory said.
Numbers from the area
A shortage of building lots may be driving a slowdown in single-family housing construction in Lawrence, but rising interest rates also likely played a role in the city’s new low for housing starts.
Flory said she believed a shortage of building lots was the biggest reason behind the decline, but said concern over rising mortgage rates also played a role.
Lawrence was not alone in posting a decline in single-family housing starts. The Kansas City metro area also posted a steep decline in housing starts in 2022, according to figures from the Home Builders Association of Greater Kansas City.
The KC metro area saw a 25% decline in single family building permits in 2022 compared with 2021 totals. Still, that decline paled in comparison with Lawrence’s. The decline in Lawrence checked in at 49% compared with 2021. While Lawrence’s single-family home starts were at their lowest level since at least 1956, the Kansas City metro was at its lowest level since 2019.
Lawrence’s 79 single-family building permits fell well short of home start figures for most major communities in the metro. Here’s a look at several home start figures for communities on the Kansas side of the metro:
• Olathe: 498
• Overland Park: 381
• Lenexa: 189
• Spring Hill: 167
• Kansas City, Kansas: 132
• Shawnee: 125
• Gardner: 123
• Prairie Village: 79
• Basehor: 65
• Louisburg: 50
• De Soto: 33