Residential Growth: New home construction in 7 south-central Idaho cities

http://magicvalley.com/business/residential-growth-new-home-construction-in-south-central-idaho-cities/article_aeb328ad-5b4a-599e-9fdf-b0e46b63f754.html

 

TWIN FALLS — If you come, they will build it.

That seems to be the case in cities across the Magic Valley, where builders have moved away from constructing homes before they are sold. Most developers say that there are very few speculative homes, or “spec” homes, out there.

But as population rises, the demand for new construction is growing across the state. Idaho ranked No. 4 last year in United Van Lines’ list of top inbound states — the second year in a row. It also climbed from No. 21 in 2015 to No. 7 in 2016 for UHaul’s growth states.

Nearly halfway through the fiscal year — and not even at the peak of building season — several cities have reported an increase in new residential building permits.

“It should be a good year for development in the Magic Valley,” developer Gerald Martens said.

Here’s how seven cities in south-central Idaho are doing year-to-date:

Buhl
October-February new home permits, by fiscal year

2016-2017: 12

2015-2016: 6

October 2016 through February 2017 new home sales: 0

Note: All new home sale data is based on newly constructed homes that were listed on the Multiple Listing Service.

What’s going on?

Buhl typically issues between three and eight permits for new homes. But last year “broke all records,” as far back as City Engineer and Building Inspector Scott Bybee can remember. The city of Buhl issued 22 permits in the 2015-2016 fiscal year.

But while there is still interest in new homes, Buhl has a shortage of developed land.

“We’re hoping that sometime soon somebody will take it on themselves to come in and build a new subdivision,” Bybee said.

Most active subdivisions

There are two subdivisions that have shown the most activity in the past two years: Old Farm and Pine Ridge. Approximately 82 of the 95 lots in those two subdivisions have either been built on or have a permit to do so, Bybee said. That leaves about 13 lots open for new homes.

“The original developers are long since gone,” he said.

Still, there’s a lot of bare ground that could yet be developed into new subdivisions.

“Residential developments are high risk and high reward,” Bybee said. “Timing seems to be everything.”

Burley
October-February new home permits, by fiscal year

2016-2017: 3

2015-2016: 31

October 2016 through February 2017 new home sales: N/A

What’s going on?

So far, Burley has issued only three permits this fiscal year — far fewer than this time last year. And there were no new home permits issued in January.

“I think that’s a first, ever,” Burley Building Department Secretary Melissa Lee said.

She believes cold weather has discouraged builders. Last year at this time, most of the permits issued were for the River Run Estates Subdivision, she said.

Things are starting to pick up again, as the city issued another five permits in March as of Tuesday, with more pending, Lee said.

Most active subdivision

The permits granted so far this year have been all over the city. But Lee expects the Harrison Heights Subdivision to be the most active as it enters is second phase. There are 160 lots altogether, and Lee expects to see another 11 homes built there this year.

Hailey
October-February new home permits, by fiscal year

2016-2017: 5

2015-2016: 2

October 2016 through February 2017 new home sales: 3

What’s going on?

New construction is starting to re-emerge in Hailey because of a housing shortage, Sun Valley Board of Realtors CEO Amanda Ornelas said.

“Right now we just don’t have a lot of sellers that are interested in selling their property,” she said.

It’s especially tight for anyone looking for a home that costs less than $400,000. The housing market has an inventory of less than two months for these homes, Ornelas said.

Most active subdivisions

The Sunburst Hills Subdivision is the first new subdivision in a number of years, Ornelas said. Tanner Construction plans to complete its second phase of the 12-lot development this summer. The first phase is completely sold out.

Homes range from $325,000 to $370,000, according to the site plan on the developer’s website.

Also active is the Old Cutters subdivision, created in 2007.

Jerome

October-February new home permits, by fiscal year

2016-2017: 5

2015-2016: 12

October 2016 through February 2017 new home sales: 9

What’s going on?

Nicole Veenendaal, broker with Keller Williams Sun Valley Southern Idaho, figures that things slowed down during the winter months with bad weather, but will pick up again soon. Jerome is still popular because it has lots available for a lower price than Twin Falls.

Most active subdivisions

So farm, Maple Ridge, Stoney Ridge and Glen Eagle subdivisions have pulled permits this year. The city building official isn’t sure what to expect for the most future development.

“I do think finally Jerome has caught up and there’s a call for lots,” said Colby Walter, owner of Keystone Construction and Idaho Legacy Real Estate.

Keystone is closely involved with the Maple Ridge Subdivision, which was developed around 2007 before the recession hit. Last year was the best in its history, as 32 of the 41 lots in the first phase have now sold, he said. The second phase has 49 lots, but has not been developed yet, Walter said.

Kimberly
October-February new single-family permits, by fiscal year

2016-2017: 7

2015-2016: 6

October 2016 through February 2017 new home sales: 4

What’s going on?

Kimberly is still a popular place for people wanting to live in a smaller community close to Twin Falls, Veenendaal said. But as the city faces wastewater restrictions, expansion becomes difficult.

“There’s quite a few new homes going on right now,” said Mandi Riddle, broker with Berkshire-Hathaway HomeServices.

Most active subdivision

Kimberly Meadows Subdivision has been issued six of the seven permits granted so far this fiscal year. Martens already has the sewer capacity he needs of fully develop the subdivision within the next year.

The first four phases are completed. There are five to six homes under construction and another 10 lots will begin construction this spring, Martens said.

“I expect construction to go on a continual basis out there until it’s built out,” he said.

The subdivision has approximately 120 lots, with 25 undeveloped.

Next, Martens plans to start developing another 60-lot subdivision immediately north of Kimberly Meadows. That will probably begin in 2018, he said.

Rupert
October-February new home permits, by fiscal year

2016-2017: 6

2015-2016: 4

October 2016 through February 2017 new home sales: N/A

What’s going on?

As new businesses come into Mini-Cassia, there is increased interest for building new homes, Veenendaal said. Areas outside of Twin Falls are attractive because they qualify for rural development programs, she said.

Most active subdivision

Mountain View Subdivision had most of the permits issued so far this date, with TKO Homes as the builder.

Twin Falls
October-February new home permits, by fiscal year

2016-2017: 85

2015-2016: 74

October 2016 through February 2017 new home sales: 34

What’s going on?

Twin Falls still has a huge demand for new homes.

“I think we’re going to have a heavy summer for single-family,” Twin Falls Building Official Jarrod Bordi said.

In fact, he estimates a 30 to 40 percent increase in single-family residential building permits.

Most active subdivisions

In Twin Falls, it’s all across the board. The subdivisions that have pulled the most permits so far: Morning Sun, Canyon Trails, Golden Eagle, Sunterra, Hometowne and Grandview Estates.

The most permits were issued for Morning Sun Subdivision, another one of Martens’. There are still about 35 lots available in the eighth and ninth phases, Martens said, with another 14 lots to be developed.

Bordi couldn’t say where he thinks the most construction will be this summer. All but one of the top six subdivisions have been in the northwest part of town, but he sees a need for more inexpensive homes such as those at Golden Eagle Subdivision in south Twin Falls.

Martens’ Broadmoor subdivision at Grandview Drive North and North College Road West, however, is also coming online. The first phase of 22 lots is sold out to builders, with the second phase of 19 lots to be developed by this summer, Martens said.