Strong home sales in Clark, Champaign highlight local housing shortage

Home sales are up in Clark and Champaign counties and in the city of Springfield. BILL LACKEY/STAFF
Home sales are up in Clark and Champaign counties and in the city of Springfield. BILL LACKEY/STAFF

Homes in Clark and Champaign County sold quickly and at a higher price in 2018 than the year before, but last year’s market could be paving the way for a shortage of available homes to sell.

Susan Burk, president of the Springfield Board of Realtors, said the real estate market in 2018 was ideal for people looking to sell and move out of the area.

UPDATE: Springfield makes good on promise to clean up Prospect St. property

“The market for 2018 was definitely a sellers market,” Burk said.

According to statistics gathered by Western Regional Information Systems & Technology, an Ohio-based company that monitors real estate trends, including in Clark and Champaign, the average sale price of homes in 2018 in Clark County increased from $116,055 to $126,252 and from $128,222 to $141,627 in Champaign.

Burk said that these changes in prices in Clark County could be due to the fact the area is experiencing a housing shortage.

Chain reaction

“We have an inventory problem,” Burk said. “We don’t have enough houses to sell.”

Burk said she has clients who are looking to buy homes in the area, but she doesn’t have any homes to sell them. This can lead to a chain reaction of homeowners not wanting to sell, because they can’t find somewhere else to move, causing a housing inventory shortage Burk said.

MORE: Myers Market renovation in Springfield continues as COhatch starts other projects

The total number of homes sold in 2018 was up in Clark and Champaign counties. Data show that 364 homes were sold last year in Clark County, up 23 from 2017, and 380 homes were sold in Champaign, up 15 from 2017.

“It’s OK now, but we can get into a situation where it prevents people from selling their homes,” Burk said. “Because homes are spending less time on the market, once they sell their home, they have no where to go.”

There was other good news for Champaign County in 2018.

Campaign County continued its seven year trend of decreasing the number of days a home was on the market, meaning that homes have continued to be purchased quicker every year. In 2011, the average amount of time a home was on the market was 171, last year, that number dropped to just 89 days.

Job growth

The reason the area experienced such a large sellers market could be because of job growth, according to Horton Hobbs IV, vice-president of economic development for the Chamber of Greater Springfield.

“This is a good sign that job growth is occurring in the area,” Hobbs said.

Companies like Silfex and Topre America Corp. both announced they were expanding and adding jobs in Clark County in 2019.

Last year, Topre announced plans for another $73 million expansion, the third in less than two years, and also pledged to create more than 200 new jobs at the Champion City Business Park.

Silfex also has plans to finish its $223 million facility in 2019. When it is complete, the project will add 400 additional jobs to Springfield.

RELATED: Heavy investment in Clark, Champaign counties in 2019

According to data from the Bureau of Labor Statistics, the unemployment rate in Clark County has gone from 7.3 to 4.8 over the last 10 years, as of December.

Hobbs said that from an economic development stand point, sufficient housing is critical. Hobbs agrees with Burk that it is important to invest in the community in ways other than jobs, like upgrading the existing housing stock.

“As we work on job growth and want to help businesses continue to relocate to Clark County, we want to make sure that we can meet all homeowners needs,” Hobbs said. “We want to be sure that we have homes for those moving to the area to move into.”

Home developments in the works

Marcia Bailey, economic development director for Champaign County, said the county is dealing with similar issues in Urbana.

Bailey said the real estate data for Champaign is also good, but that Champaign has already began working with property owners and government officials to increase home inventory.

“We have some wonderful loft apartments currently available; this offers a different type of local living and could attract a younger population to downtown Urbana,” Bailey said.

Bailey echoes Hobbs saying that in order to grow as a community, homes must be available for all those willing to move for a job.

“We would like to see our community grow and having housing stock is vital to population growth,” Bailey said. “We want to attract more workforce to our area and having affordable and a variety of housing is pertinent.”

Clark County is expected to see new housing construction in 2019.

A major housing development near the Tuttle Road Walmart could bring as many as 230 new homes and will be built in four phases. DDC Management said construction is set to begin as early as March or April.

In December, Springfield also approved a redevelopment agreement with Charles V. Simms Development Corporation to build 34 town homes downtown.

Residents can expect to see the results of these projects late this year and into 2020.

‘Nothing happens over night’

Springfield Mayor Warren Copeland said that good things, like these housing developments, are coming to the area but you have to give it time, much like with city did with job growth.

“Nothing happens over night,” Copeland said.

Copeland pointed out examples like the fact that Springfield used to function has an industrial city, but as things changed, the city learned to adapt and pursued different jobs for the area. This is much like what the city commission is working on doing now, in regards to housing and downtown development, he said.

“We were really focused on jobs, and look what we were able to accomplish,” Copeland said. “Now we are turning our attention to this.”

The city has already taken other steps to address the housing shortage as new construction gets underway. The Community Improvement Corporation of Springfield (CIC) recently endorsed expanding Springfield’s existing Community Reinvestment Areas.

RELATED: More home improvements in Springfield could qualify for tax abatement

Under the CRA, the city can award a 100 percent tax abatement to property owners who choose to build new or improve existing residential structures in the designated CRA.

The purpose of the CRA encourages revitalization of existing housing stock and the development of new structures, which city officials hope will encourage homeowners to make significant improvements to their homes in order to invest in community development.

Improvements that may qualify to receive the tax abatement include building a new porch, installing a sunroom, converting a basement or attic into a living space, building or enlarging a garage, installing an indoor fireplace, adding bathroom or other new construction projects.

Burk and Bailey both agree that now is a great time to do home renovation projects.

“We’re encouraging people to fix up their homes and have them ready for spring,” Burk said.

The other thing they agree on?

“If you are thinking about selling your home, you should,” Burk said.

Number of homes sold in Champaign County in last five years

2014- 392

2015- 443

2016- 423

2017- 395

2018- 380

Number of homes sold in Clark County in the last five years

2014- 1158

2015- 1295

2016- 1351

2017- 1341

2018-1364

Average cumulative days on market in Champaign County:

2014- 135

2015- 135

2016- 132

2017- 126

2018- 89

Average cumulative days on market in Clark County:

2014- 114

2015- 96

2016- 86

2017- 103

2018- 97

Facts & Figures

$126,252: Average purchase price of a home in Clark County in 2018

230: Number of homes in proposed new single-family housing development in Springfield

7: Number of consecutive years Champaign County homes have reduced days on the market before selling