The Springfield area is the second most-affordable small city housing market in the nation, according to CNNMoney.com, based on the Housing Opportunity Index from the National Association of Home Builders and Wells Fargo.
More than 93 percent of the homes sold the last three months of 2013 were deemed affordable, according to the Housing Opportunity Index. The Springfield-Clark County area, with a population of 137,206, had a median home price of $76,000 and a median income of $53,500.
The Housing Opportunity Index is the percentage of new and existing homes sold that buyers earning the area’s median income could afford. Mortgage data is based on rates reported by the Federal Housing Financing Agency and prices of new and existing homes are based on figures from CoreLogic.
“It’s a double-edged sword, sort of,” said Nancy Eubanks, 2014 president of the Springfield Board of Realtors and real estate agent for Roediger Realty. Eubanks has been in the local real estate business since 1990.
“From a buyer’s perspective, it is very good news,” she explained. “It means the buyer is getting more home for their dollar. It’s bad news because the current (mortgage lending) rules have kept many of the younger and first-time buyers out of the marketplace. And the low inventory we have right now isn’t helping either.
“All of this has had an offsetting effect.”
That effect can be seen in the current flat area housing market, hampered by the recent holiday season and extreme winter weather. That might not be the case for long.
“We could be looking at a very lively spring and summer,” said Eubanks. “We’re anticipating a very good market in the Springfield area in 2014.”
Area home sales increased in 2013. In Springfield, there were 564 homes sold last year at an average price of $67,176, according the Multiple Listing System. In 2012, only 509 homes were sold at an average price of $65,230. In Clark County in 2013, 1,252 homes were sold with the average price of $96,027, compared to the 2012 figures of 1,122 homes for an average price of $93,932.
Shannon Meadows, Springfield Community Development director, feels the CNN Money report, coupled with these numbers, means more to the area than just home sales.
“You can look at it in two ways. I think that it is a shining light of opportunity, so it is a good thing,” she said. “We know that the housing market is affordable, and we locally know that there are more assets than just what we have in housing. We also have fantastic arts, culture, recreation and quality of life. So I think the article brings to light that we live in an area of opportunity.”
Among the factors driving housing affordability, according to the article, was the drop of population by 13 percent in the last four decades.
“As a region, we have population loss, and where there is population loss, you are looking at a housing imbalance,” Meadows said. “We’ll get asked the question, ‘Why does Springfield have so many houses (on the market)?’ And I will say, ‘Forty years ago, Springfield had a lot of manufacturing. When there were manufacturing jobs, people lived in houses. When there weren’t as many, people went somewhere else to find a job, and their houses stayed here.’ Then people understand.”
Kent Sherry, executive vice president of the local Building Industry Association, had a slightly different point of view on the report.
“I just don’t see that making much difference either way,” said Sherry. “When you are identified as having affordable housing, it’s usually more of a negative than it is a positive. It definitely shows that the recovery here is not as fast as the rest of the nation.
“We have built very few houses over the last two years in Clark County,” he continued. “We are way, way behind the market in that sense. Demand is the big thing. We do not have that strong of a demand for our housing, so that keeps (home prices) down.”
Sherry did point out that there are advantages of living in an affordable market.
“It opens the door of opportunity for those who would like to take advantage of our housing market, to move into Springfield and Clark County,” he said. “When that happens, you get a vested interest in our infrastructure and schools. And that’s ultimately what you want.”
That, in turn, creates a trickle-down effect.
“When people buy homes, they also buy new furniture, décor, paint, carpet,” said Eubanks. “And many times, it is not the ‘perfect home’ they are wanting when they move in, so they go into remodeling mode.”
Ultimately, says Meadows, statistics don’t matter as much as the area’s human resources.
“Statistics can be presented any way you want, in a positive light or a negative light,” she said.
“In Springfield, you will find people who will not give up on making it a better place to live. That’s good for our future.”
Kokomo, Ind., was ranked first. Nearby Lima, Ohio, was seventh, and seven of the top 10 in the study are in the Midwest.