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Demand for homes in Columbia dwindles

Sunday, June 21, 2009 | 12:01 a.m. CDT; updated 11:10 a.m. CDT, Monday, June 22, 2009
Contractor Ray Yoder cuts a piece of plywood to size as Michael Schoen and Dan Yoder wait to nail it into place on the house they are constructing just off of Old Plank Road in Columbia on Wednesday

COLUMBIA — As owner of Four Seasons Construction, Ray Yoder was comfortable overseeing his housing projects from the office. That was until the housing market bottomed out.

Earlier this month, Yoder was cutting lumber and helping his crew on a new home under construction in the Cascades. “Now I’m doing things I normally wouldn’t be doing,” he said. “This is the first time I’ve put the tool belt on in 10 years.”

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According to the Columbia Department of Public Works, the city issued 41 permits for new home construction in May 2009 compared to 96 in May 2007 — a 57 percent decline.

The trend was similar in unincorporated parts of Boone County, where 12 permits for new homes were issued in May 2009 compared to 35 in May 2007.

Unlike some builders in Columbia, Yoder has been able to stay in business. He thinks the local housing market will slowly recover.

“For the ones that can hold out, it will come back around," Yoder said. "We’re trying to stick with it. Hopefully, it will come back around. We’re optimistic.”

According to the U.S Census Bureau, national housing permits for May 2009 were up 17.2 percent from April, but that was still 5.8 percent fewer new homes compared to May 2008.

With the exception of this past February, permits to remodel existing homes in the city have outpaced new home permits every month since March 2008.

“We’re used to building houses, now we’re remodeling more,” said Jay Wilson, owner of Jay Wilson Construction. “We have to do anything to make a living.”

Dan Kliethermes, owner of Kliethermes Homes & Remodeling, believes the building situation is simple.

“Back when it was booming, they were building more houses than were needed," Kliethermes said. "The banks were loaning money to whoever wanted it. Now it’s dropped down to where it needs to be. Within the last three months, we have been getting demand back.”

Kliethermes said the lack of demand has put some builders out of business, which has led to fewer builders bidding on certain jobs. He believes the demand will eventually catch up with the supply of new houses and the housing market will soon become healthy.

Yoder said he personally knows of three builders who have gone out of business. "I hope we can outlast the competition,” he said.

Roger Wolverton, a homebuilder in Columbia, said he is waiting for the housing market to recover. “You don’t want people to start building and not have the market to support it,” he said.


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Comments

Charles Dudley Jr June 21, 2009 | 4:41 a.m.

Did they ever think we have too many empty homes as it is now.

(Report Comment)
Panama Red June 21, 2009 | 11:34 a.m.

It's about freakin' time!

(Report Comment)
Ray Shapiro June 21, 2009 | 2:03 p.m.

I don't like seeing the little guy being hurt by decreased demand for spanking brand new homes going and I hope they find their way in these trying times. I have less sympathy for those who were able to stockpile assets as they over-developed this town, increased inventory and hurt the "resale market" and contributed to decreased value of older homes and older homes being on the market longer then ever.
It would have been wiser for the city to have placed a moratorium on permits for new developments, especially duplexes, which are destroying older home property values and increasing neighborhood crime throughout our city.
The future of Columbia is now very ominous thanks to some very poor, immediate gratification,knee-jerk reactions of our city leaders coupled with property merchants looking to make a fast buck and then move on to the next development without any regard for the "inner-city."
I can envision the future of Columbia as a "mini-St. Louis" in the not to far off future. Maybe that's what the developers, city manager and mayor are hoping for.
The more disdain "the rich" have for "inner-city" life, the better chance "suburban developers" will have to push their ware3s.
Ah, the unspoken plan.....

(Report Comment)
John Schultz June 21, 2009 | 9:34 p.m.

Ray, the city would likely get sued if they did not issue a building permit for a structure that was suitable for the zoning of the land upon which it said on. The supply of residential housing in Columbia seems to be coming back into usual norms if I recall the figures I saw a couple weeks back. The market is working itself out - developers and builders are putting up less houses since they can't sell the and when supply clears out, they can start building once again. No need to get government involved, that's part of the original problem (Fannie Mae, Freddie Mac, pushes by various administrations to increase home ownership, and so on).

(Report Comment)

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