Big Lake Housing is growing

 The Big Lake Community is on the “grow” again, following eight years of quiet, the effects of the recent Depression.

   What will the community look like in say, five years, or 10 years? What are all the factors determining its growth - and the type of housing needed to accommodate that growth?

   Projected answers to those questions came Monday from Mary Bujold, president of Maxfield Research and Consulting of Golden Valley, who addressed the Big Lake Economic Development Authority (EDA) at City Hall. Sitting in were members of the city council and planning and zoning commission.

   What were her key takaways?

   Big Lake will remain an attractive community for residential growth, but the growth will be slower than the previous upturn in growth;

   Younger and aging population growth will impact alternative housing types;

   The community has a very low 3.4% unemployment rate, lower than other areas of the state,  and a good share of its residents will need to find work in adjacent communities;

   Older and senior housing is limited, with low vacandy rates;

   Home prices are increasing, and that includes big surges in land costs;

   There is a lack of middle-market and move-up housing, especially in single family stock, as a result of new construction being aimed mostly at first time buyers;

   There will be a demand for most housing types this decade and beyond.

   Bujold’s study was the result of a community housing survey conducted this spring in the community. She refers to the Big Lake Market as including neighboring townships, Big Lake and Orrock.

   People from within the market area will comprise 80% of those needing additional housing.

Who’s Living Here?

   A higher percentage of people are moving into the city than to the two townships, she reported. In 2000, townships outdrew the city in move-ins by a 3-2 margin. By 2010, that comparison was even; by 2016, the city had moved ahead and that trend will continue into 2025.

   Children under 18 account for about a third of the area population, and that will continue to grow.

   Largest growth group, however, is those aged 55 to 72, as the Baby Boomers grow to senior citizenship.

   Big Lake remains about average to surrounding communities with about 35% of households having married couples with children.

   Household size is stabilizing at around three.

   There is a remarkably high home ownership rate in the community, she reported. Ninety-five percent of those living in the townships own their homes and 83% in Big Lake, compared to 73% statewide.

   Big Lakers earn more than their counterparts around the state, and that is likely to expand.

   In 2016, the city median family income was $68,148, and $78,971 in the townships, compared to $61,657 statewide.

   By 2021, the city family income should increase to $80,436, and the market area to $90,312.

   There is a large disparity between incomes of homeowners and renters in the city, whereas homeowners have an earning of $68,835, compared to $32,123 for renters.

   And, Big Lake is a “job exporter,” Bujold reported.

   The area unemployment rate is 3.4%, compared to 3.3% statewide. And the community, for every 2,112 workers who came into Big Lake, 5,355 workers left for employment elsewhere, usually within close-by communities.

   Average weekly wage in 2015 in Big Lake was $675; it was $1,159 as the highest in the manufacturing sector,

So, For The Houses

   There were 253 housing units constructed in Big Lake during the Depression (2007 to 2015), an average of 28 per year.

   In the preceding robust years, there were 202 single family and multiple living units constructed per year.

   The housing stock is relatively new, with 58% built prior to 2000 and 41% built since. Single family detached homes ccount for 95% of all owner-occupied housing.

   And - 87% of Big Lake owners have a mortgage.

   New home prices are escalating quickly following the conclusion of the Depression. Mortgage foreclosure sales have just about cleared out and all now available on the market are newer units. 

   Most of the new homes coming on the market are for first-time buyers, but they are escalating up into the $250,000 range.

   Pre-owned homes were a little different. In June, there were 25 homes on the market at prices from $150,000 to $199,999; another 29 homes (the largest share) were on at $200,000 to $249,999; the third-largest share (17) were on at $250,000 up to $299,999; and another 10 (the fourth largest share) were on at $300,000 to $399,999.

   Median list price for those homes was $225,000 in Big Lake; the average price was $264,775.

   Of 311 rental units (in 12  projects) around the city, there was a 0.6% vacancy rate. Market rate units (210) had a 1.0 vacancy rate; affordable and subsidized (101 units) had a 0% vacancy rate.

Their Recommendations

   They suggest the demand will be for about 140 single family homes, mostly build on the 548 vacant lots.

   Entry-level construction (under $200,000) will be very difficult, given land, materials and labor costs.

   Maxfield also says there will be demand for 168 units in privately-owned multi-family housing. They could be in twin homes, townhomes, quads or row homes, with entry levels at $225,000.

   There is a suggested demand of 190 rental units, about half of them at market rate.

   For the seniors, a demand of 122 units, in various cooperatives, congregate and assisted living.

   “Staff and policymakers believe there is more housing needed in Big Lake, and the purpose of the study was to have a third party (Maxfield) confirm that,” says City Administrator Clay Wilfahrt.  “Our market will demand 60 to 75 new single family homes each of the next 10 years. Overall this information is good news and indicates steady future growth.”

   The Maxfield survey cost $12,500, of which $4,000 was absorbed by a grant from the Initiative Foundation.