Shifting Louisiana Housing Market Excludes Many
It’s taken four years, but Sonya St. Julien has escaped the Lafayette, La., apartment market and bought a home within her means.
The 34-year-old reveled in the realization of her dream Friday morning, on a final walkthrough of her new home in Youngsville, La. At $170,000, it’s about $60,000 more than she targeted when she started the house hunt four years ago.
She may be one of the lucky ones.
Advocates say the working class is being left behind by the local Louisiana housing market as well as the rental market.
Community planners say it could hurt the city’s infrastructure, economy and overall well-being in the future. First-time buyers are struggling to find homes below $150,000. The city’s apartment market is above 96 percent occupancy, pushing rental prices up and out of affordability.
“Every place I looked (to rent) was just as expensive, if not more,” St. Julien said. “My mother said, ‘Give up on the apartment search and move in with me,’ so I could save for a house.”
Real estate agents and Louisiana mortgage lenders agree there’s a glut of buyers searching in the $75,000-175,000 range for new homes, favoring them over pre-existing homes.
But some home builders continue to work on bigger, pricier houses.
That low supply frustrates first-time buyers like Christian and Christina West, whose mortgage capacity is seriously stretched. The couple, who make $50,000 a year together, searched six months for a home within their price range ($100,000-115,000) before buying three weeks ago for $125,000.
“We had not a lot to pick from. It just wasn’t a very good experience,” Christina said. “I am grateful for what I have. But I wouldn’t want to do it again for a while. I didn’t like it at all. I don’t like stress.”
Area mortgage lender groups say they’ve approved a long list of qualified people like the Wests to buy in the $75,000-$175,000 range who can’t find a home to seal the deal.
“Builders are missing out on that group,” said Louis Cowen, Coldwell Banker real estate agent, “but because of increased costs of lots in Lafayette and materials, they’re caught between a rock and a hard place. It’s much more difficult to make a profit on homes under $200,000, but that seems to be where the demand is.”
For the last 10 years, home builders here have heavily pursued the higher-end market, said Steve Oubre of Architects Southwest - resulting in a very saturated high-end market, which should push builders to pursue lower level housing.
Oubre and Architects Southwest are dealing with affordable housing issues in 20 cities now nationwide. River Ranch, the ideal mixed-use “smart growth” model, was meant to have a range of homes to accommodate millionaires and school teachers.
But when the market takes over, structuring a diverse community is secondary to profit.
“It started out this way, but it became so gentrified that those homes selling for $140,000 are now selling for three times that much,” Oubre said.
“The responsibility of affordable housing isn’t a for-profit development. A (real estate agent’s) goal is capturing as much profit as they can, in light of the risk associated with it.”
Oubre is involved with the affordable, diverse Sugar Mill Pond community, meant to be within reach of any home loan seeker. He thinks the market will rule there too, using the pros of mixed-use living to push prices higher than intended.
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