Seeking Solutions: Housing shortage offers no easy answers, officials say

A late spring opening for Nordic Landing, an affordable housing project along the Grant Avenue Parkway corridor, was a reason to celebrate for the development team and the city, according to project officials.

It added a 41-unit, nearly 40,000-square-foot apartment complex to the city’s housing stock, helping to meet an ongoing need – particularly in the affordable housing area. However, Debbie Shantz Hart, co-owner of DHTC Development LLC, which launched Nordic Landing, says anyone looking to rent one of the units is in for a wait – likely a long one.

“We were fully leased in June, so we leased 41 units in 30 days,” she says of the 810 W. Catalpa St. development. “There’s an extensive waiting list. I would say probably 80 or 90 people on the waiting list.”

The high level of interest in Nordic Landing wasn’t a surprise to Hart.

“There is such a pent-up demand for quality, energy-efficient, affordable housing. It’s not a shock that we have so much demand for it,” she says, noting most of Nordic Landing’s one- and two-bedroom units range $575-$750 per month.

Right around the same time Nordic Landing finished, DHTC Development also completed Bluff View Apartments, a 48-unit, two-building complex in Branson. It also has an extensive waiting list, Hart said. Both projects utilized the Low-Income Housing Tax Credit, a federal program that provides tax credits to developers in exchange for keeping rents low.

Springfield nonprofits also are adding to affordable housing stock in town. Habitat for Humanity recently broke ground on the third and final phase of its Legacy Trails subdivision, at 2137 W. Volunteer Way, while The Kitchen Inc. was set for a groundbreaking on Oct. 18 for another phase of its multimillion-dollar Maplewood Villas affordable housing development, according to past Springfield Business Journal reporting.

The new phase for Legacy Trails will add 15 houses to the 39 homes currently in the subdivision. The Kitchen will add 32 units designed for low-income and formerly homeless seniors, including veterans, to its 44-unit first phase, completed last year at 550 N. Duke Ave., north of Chestnut Expressway.

In demand
Even with the oncoming additions, Hart says more housing stock of all types, including rentals, are needed to meet demands of residents – both current and future.

“I think Springfield and southwest Missouri are not really different than any other part of the country right now,” she says, regarding housing challenges. “I think that you’ve seen prices escalating. Inflation has been real in terms of housing costs, both for buying and renting. I also think there’s a limited supply, although I think Springfield is certainly adding units.”

Missouri has a housing shortage of nearly 120,000 affordable and available rental homes for the over 205,000 extremely low-income households in the state, according to the National Low Income Housing Coalition. The average income limit for a four-person household considered extremely low income is $28,580.

Tyler Bussell, vice president of Bussell Building Inc., says his company is constructing single-family residential houses at a steady clip to meet ongoing strong demand. He expects to build 100-120 homes this year, which is on par with the past couple years.

“It’s affordability as probably the largest thing. Rates are high, prices are high,” he says for both home price tags and the cost to build them. “We’re seeing some things normalize a little bit, but we’re still at a fairly high price compared to where we have been prior.”

Bussell Building is currently focused on a trio of subdivisions: Green Ridge Estates in Battlefield, Forest Heights in Nixa and Valley Ridge in Ozark.

“I’m not seeing inventory sit for longer than what I would expect to, if at all. But I’m also not selling homes to the point where I need to double and triple production,” he says. “I would say typically I’m getting a home moved within about two weeks of completion.”

Although he says there’s no shortage of buyers, particularly for homes with lower price points, the days of inexpensive starter homes may be gone.

“Today’s range for a starter home is going to be $220,000-$250,000 price point, which is unbelievable. But that’s about where the new starter home begins,” he says.

Most respondents in SBJ’s 2024 Economic Growth Survey see housing prices impacting the ability for employers to recruit and retain employees. Nearly a quarter – 23% – believed it has a very large impact, while 35% said it has a somewhat large impact. Only 10% replied it had no impact.

Additionally, 76% of survey respondents cited Springfield needs more affordable single-family housing – followed by 46% noting a need for more townhomes and condos – to remain competitive in the next five years.

On the multifamily development side, Morelock Builders & Associates Inc. is staying very busy, according to president and owner Wayne Morelock.

“We’re actively working on six projects for a total of approximately 1,000 living units,” he says, noting they cover Springfield, Battlefield, Ozark and Nixa.

Some of the projects include a second phase of Finley Ridge Apartments in Ozark, adding 96 units to the nearly 100 already built, and The Wayfarer in the Glade and The Wayfarer in the Dale – companion apartment projects on South Grant Avenue in Springfield.

Challenges in building multifamily projects are not unlike those faced in other real estate investment areas, Morelock says.

“It’s the interest rate, it’s the cost of goods and labor and it’s the availability of properly zoned land,” he says. “Those are our greatest challenges.”

Morelock says navigating the challenges require working with architectural partners to design projects as efficiently as possible, making sure banking partners have competitive rates and searching out new pockets of land that, per the city’s comprehensive plan, can accept proper zoning.

Space consideration
There’s a need for higher density land use that could help provide more units per acre, Morelock says. It’s the type of project that the Drew Lewis Foundation Inc. is developing in the Grant Beach neighborhood. The nonprofit is set to break ground Oct. 23 on a pocket neighborhood intended to boost affordable housing availability, says CEO Amy Blansit. The 737 N. Broadway Ave. project is dubbed Broadway Cottage Courtyard.

The organization purchased 1.2 acres of mostly vacant land for $115,000 from J.L. Reynolds LLC at the northwest corner of Broadway Avenue and Poplar Street, according to past reporting. The property sits roughly a half-mile south of the nonprofit’s home at The Fairbanks, 1126 N. Broadway Ave.

The three-bedroom, two-bathroom homes will be separated by roughly 10-12 feet and are expected to include recessed garages, front and back porches, and connecting sidewalks to help foster a sense of community. The floor plan for the roughly 1,800-square-foot, two-story houses has all bedrooms on the second floor.

“What we’re really focusing on is the greatest need that Springfield has and it’s that missing middle,” Blansit says, in reference to diverse housing options such as pocket neighborhoods, townhomes and duplexes. “And so that’s kind of what this will be. They will be affordable, but it’ll still be traditional bank loans that individuals will have to qualify for.”

The goal is to have at least half of the homes priced at $135,000, with the remainder sold at current market rates, according to past reporting. Interest is strong, Blansit says.

“We’ve got several families that are currently working toward having preapproval, basically,” she says, adding construction will likely wrap in late 2025.

Even before the dirt has been turned, Blansit says the nonprofit has been approached about the possibility of another pocket neighborhood in Grant Beach.

“If that lot was made available to us, we would do a second one,” she says, noting the nonprofit has worked with the city to develop Broadway Cottage Courtyard with the hopes it could serve as a model for others to follow. “We’ve listened to what the city wants, and we’ve really worked with them on how we can build something that others can come along and say, ‘If you do it like this, we can fast track the process.’”