Housing Starts, Builder Optimism Rising in Kansas

New home starts in DeSoto, Kansas, remained steady in 2006, but experts think the region will see significantly more in the coming year, reports the DeSoto Explorer.

Kicking off 2007 with the same optimism other experts have for the Kansas housing market, city officials recorded 33 new home starts last year - the same as 2005 - but with the addition of 12 new units from three triplex projects and three new commercial buildings.

Some officials are concerned because if the new developments should fail to materialize, any revenue shortfall would have to be made up through month rate increases, or worse yet, property tax assessments.

The reduction of inventory, pent-up demand, lower gas prices and return of low mortgage rates all point to a healthy rebound of home construction in the area, officials believe.

Arbor Ridge, one of the new developments, is ready to take advantage of a recovery in 2007.

At the end of the year, none of the homes in Arbor Ridge had sold and all but a couple were still under construction. The street on which the homes were being built looked like a construction site as high Kansas mortgage costs kept may prospective buyers at bay.

“The first phase of any subdivision is always the hardest. The homes are incomplete and the yards are incomplete. Once you get homes occupied, that gets people really ready to buy,” said Dan Gulley, the local real estate agent in charge of sales.

There were some “spec” homes ready to close, Gulley reported. Once they do, the developers would apply for more building permits and start building more homes on spec. Hopefully, by the time they are able to be occupied, there will be enough home loan demand and buyers will he signing contracts.