Analyzing the Home Builders Association’s 2016 Report

Overal things look good, but there is some concern for affordable housing

Between Fargo, West Fargo, Moorhead, and Dilworth Housing activity is steady and values are the highest they’ve been since 2008.

That’s according to the Home Builders Association of Fargo–Moorhead’s 2016 Annual Report.

The report shows positive numbers in just about all areas and where there were declines, they were mostly minimal.

Overview

 

Last year 4,550 building permits, which include remodels, were approved between the four cities, which is the most since 2008.

Those permits collectively brought in $895 million to the area.

New home construction  decreased in all of the cities except for West Fargo which saw a slight increase.

Fargo was the only city to see a rise in property values among the four cities.

Even with the decreases, the Home Builders Association says the year was a success.

“Despite some rainy weather and a very, “quiet” presidential election as you all know that we had last year, also including frigid temperatures as well in December, which was a little unusual we were actually very steady which was very, very awesome,” said Tyrone Leslie, President of the Home Builders Association.

There were over one thousand new single and dual family homes built between the four cities, accounting for one fourth of the total permits.

Concern for Affordable Housing

The annual report shows concern for the affordable housing sector, particularly in Moorhead.

Although single–family home permits were up in 2016, the news isn’t as good for other types of housing across the region.

“It’s troubling to see the attached housing sector decrease by 34% over last year,” said Leslie.

But that decrease is hitting the City of Moorhead hardest, where permits went from 48 in 2015 to just four in 2016.

The types of homes that are seeing the biggest decreases are twin homes.

That affects a wide variety of home buyers.

“People that are empty–nesters that like to go to the lake in the summer that like a twin home. I know a lot of them, the first occupant, they’re purchased for tenant occupancies. So they’re rental units, long term rental units and I know that it is because of the affordability it’s also the first home of a lot of first–time home buyers,” said Moorhead Community Development Manager, Lisa Bode.

Experts said they think they know the root cause of the problem.

“Part of the reason we believe that is, is because of some of the legislation that has occurred with the Sprinter Bill. There’s some confusion there,” said Leslie.

When the Sprinter Bill passed in early 2015, it re–categorized twin homes stating they had to include fire sprinkler systems.

Bode said that increased the cost of construction between five and nine thousand dollars.

“We recognize this is a big issue for Moorhead, that we want to welcome those first time home buyers at modest income levels,” said Bode.

The City of Moorhead and the Home Builders Association are working with state legislators to change the wording of the Sprinter Bill.

“It is our goal to keep new housing and home ownership attainable for more of the area’s working families,” said Leslie.

They hope to have the issue resolved by the end of this legislative session.

So far, no twin home building permits have been passed in Moorhead this year.

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