"The home prices are outrageous," Cindy Hukriede said. She has been looking for a three bedroom home for her family, but cannot find an affordable home.
"I waited and saved so I could afford a home in the $60,000 range. I don't want to be strapped for funds the rest of my life," she said.
Hukriede presently rents a home on the south side of Lake Koronis. She has been looking for a home to purchase since the fall of 1999.
"When I started looking, there were no affordable homes on the market," Hukriede said. "Everything cost $80,000 or more. They are not for a low income family."
Hukriede is happy with her rental home, but her dream is to own a home someday. "I'll stay put until something comes along. I don't have to move. However, it gets discouraging when you look for a home. I don't foresee the market going down, either," she added. "The prices will only go higher."
In 1995, the city of Paynesville had 655 single family homes, 214 multiple family homes, and 41 mobile homes.
In 1998, the city issued 80 building permits, which includes business and residential projects. The permits cover new, remodeling, and shingling projects. In 1999, the city issued 83 permits.
Rental properties
Laurie Rausch, youth director at St. Louis Catholic Church, said she had a hard time finding a place to live in Paynesville when she first arrived. "It was a challenge," she said.
In Wisconsin, Rausch recalls lots of listings for places to rent. "Here, I couldn't find a listing for anything. I wanted to rent a place since I couldn't afford to purchase a home," Rausch said. A member of the church came to her rescue with a small place to rent.
After their first child was born in April 1999, Doug and Jamie Miller started looking for a larger place to live around Paynesville. They found houses and apartments to be scarce in the area.
Miller feels extremely lucky to have found the rental property where his family presently lives. It took persistence and an eight-month wait before the Miller family could move into the house.
"We have talked with a lot of younger people who are looking for homes. They are scrounging for deals on fixer-uppers because they are cheaper and more affordable," Miller said.
"Prices for homes are stiff. Young couples can't afford high-priced homes," Miller added.
Cal Davidson owns two apartment buildings in Paynesville and is in the process of constructing two duplexes. "The duplexes are already rented before we even start construction," he said.
Next spring he plans on erecting Chicago-style row houses on Lake Street, east of Farmers and Merchants State Bank. The row houses will consist of eight apartments and three are already leased. "Apartments are in demand. There is not a lot of property out there," Davidson said. "We have a waiting list of people wanting to rent."
The new apartments erected last year along Spruce Street in the Chladek Addition are filled and have a waiting list.
Promoting new housing
Economic Development Authority of Paynesville was formed to attract businesses to Paynesville. Their goal was to have businesses, creating local jobs. The problem now is the jobs exist but are not filled.
Besides attracting prospective employees to Paynesville, EDAP has added the need to find affordable housing, said EDAP President Pat Flanders, who is also a realtor.
EDAP is working with the Tri-County Action Program to erect affordable housing in Paynesville. EDAP is subsidizing the purchase price of homes by $5,000, said Dennis Wilde, Paynesville City Administrator. "For each year a family lives in the home, 20 percent of their loan is forgiven," he said. Tri-CAP has built homes and townhouses in Paynesville. This could alleviate the housing pressure, but doesn't come close to solving the problem, Flanders said.
According to Flanders, there are five Tri-CAP homes in town and another one is going up. However, several were sold before they were finished. "There is still room for more." he added.
The city of Paynesville recently aannexed Project 55 which will have 16 lots available for sale later this summer. Other housing projects are in being planned.
The Stearns County Housing and Redevelopment Authority (HRA) has approached EDAP about being part of the Heading 4 Home program. The program proposes to build more than 60 homes throughout Stearns County over a three-year period. Paynesville has been earmarked as one of the communities to receive some affordable duplex rental structures.
Wilde said Paynesville isn't the only city with a housing shortage. The League of Minnesota Cities is sponsoring an affordable housing symposium in St. Cloud to help cities find solutions. A representative from Paynesville will attend to learn how communities can develop affordable housing.
Home market
"Paynesville definitely needs more lots in town to encourage people to build," said Sue Johnson of Bolstad Realty. "Paynesville has a shortage of houses and empty lots."
Johnson explained the home market is cyclical. Realtors need people who own larger homes to sell for something smaller. Then people can buy the larger homes, opening up apartments or other homes for sale or rent.
"We have a lot of people wanting to downsize their living conditions, but there is nothing to buy," she added.
"People want to move out of the Twin Cities to a smaller community where they feel safe," said Johnson. Others are looking to live in Paynesville as it is a central location between their work places.
"We have a lot of good employees in the city looking for housing," said Diane Kodet, Community First National Bank loan officer. "The trend seems to be to finance for what you need, then refinance when the interest rates go down."
Kodet doesn't foresee the pace for home loans to slow down. "A lot of people are getting loans to build new homes since they can't find anything on the market to purchase," she said.
"It is a seller's market," agreed Chris Stanley, manager of the Paynesville Office of the Melrose Credit Union. "Homes are sold before they are advertised. People are looking for $50,000 to $80,000 homes and there are none around."
"Homes in the $100,000 bracket are even selling fast," he added.