Southeast Kansas has lagged other parts of the state in meeting the demand for housing that mushroomed in the wake of the pandemic, local and state officials say. Lower salaries and a lack of buying power have been among the reasons. Area officials are confident they can catch up. But some say they might have to challenge some long-entrenched assumptions about what housing looks like.
By Stan Finger/The Journal
The new slate gray ranch houses stand side by side in Neodesha, windows sparkling, driveways gleaming, lawns still green under an autumn sun.
They’re simply waiting for someone to move in. And waiting. And waiting …
The unsold houses on North Second Street, along with two more new houses around the corner on McCartney Lane, reflect the challenge southeast Kansas faces even as demand for housing skyrockets in the region – and, indeed, just about everywhere in the Sunflower State. Despite multiple incentives in place to bring down the price of the homes, folks in the area are unable – or unwilling – to buy them.
“People say ‘We need affordable housing,’” says Jeri Hammerschmidt, a senior housing specialist for First Step Builders, who lives in Independence. “But what that really means is ‘I need affordable for me.’”
Southeast Kansas has lagged other parts of the state in meeting the demand for housing that mushroomed in the wake of the pandemic, local and state officials say.
“It does seem like we have historically received fewer applications from southeast Kansas than other areas” for available funding, “and that it’s harder to get things moving,” says Alissa Ice, director of housing development for Kansas Housing, a nonprofit, public entity that serves as the primary administrator of federal housing programs for the state of Kansas.
There are a multitude of reasons, state and local officials say.
One is buying power. Generational poverty is a fact of life in southeast Kansas, rooted in mining activity that peaked around the turn of the 20th century, leaving people and the land scarred.
Dena Daniels was earning more than $30,000 a year as a Wichita police officer, but when she and her husband moved to Humboldt in Allen County in 2005, an extensive job search landed her a position at an insurance agency for $8 an hour, or about $18,000 a year.
Last year, the U.S. Bureau of Labor Statistics put Allen County’s median wage at a little more than $20 an hour. Despite that improvement, it means many families cannot afford to buy a new or even existing house.
Daniels, who is now a real estate agent, says many local loans could be rural development loans for up to $75,000, but there are no houses for sale at that price that could pass housing inspections.
With existing businesses expanding and new employers moving into the region, salaries will inevitably improve as competition for workers increases. But even with the rising demand for housing that’s accompanying that growth, Daniels and others say, Humboldt has been able to add only one or two new homes each of the past few years.
An analysis by the Kansas Department of Commerce indicated Independence, about 50 miles south in Montgomery County, needed to build 57 new houses a year to meet local demand. How many were built in 2023?
One.
City officials made housing the top priority for 2024, however, and the needle has begun to move. Bids for construction on the first phase of the Jefferson Subdivision – named for the elementary school nearby – will go out early in 2025. The infrastructure has already been installed for Independence’s first housing development in nearly two decades.
The city also created a Reinvestment Housing Incentive District for its historic downtown. The designation allows for property taxes to be returned to the owner in the form of a rebate, lowering the cost of renovation projects. A Topeka developer purchased several buildings in the heart of the city and has begun work to convert upper floors into apartments and ground floors into office and retail space.
“Any rural community in Kansas is facing housing challenges,” says April Nutt, executive director of the Independence Housing Authority. “That’s probably one of the positives post-pandemic: We have seen an influx of urbanites moving into rural areas. Independence is not unique to that.”
‘We have a lot of irons in the fire’
But economies of scale mean developers are reluctant to build in smaller towns and cities because larger projects in metropolitan areas provide more profit potential. Building new homes in established neighborhoods is difficult, Nutt says, because there is typically a significant gap between what it costs to build and what the appraised value of a new house will be due to the lower appraisals of surrounding homes.
That “appraisal gap” is a daunting obstacle throughout rural Kansas, says Randy Speaker, a housing specialist for the Northwest Kansas Economic Innovation Center in Norton. Numerous Kansas towns that have not had new homes built for 50 years or more are trying to figure out how to respond to a surge in interest unlike anything they have seen. Yet a house that costs $300,000 to build may only appraise for $225,000 because of the worth of surrounding homes.
“I’m not one to see a stop sign,” Nutt says. “I’m one that sees a curve: OK, how do we go under or over or around it?’ We can make it happen. It just may not be the traditional way.”
A task force established early in 2024 has launched several initiatives to make a wider range of housing available in Independence.
Among them was doubling to $100,000 the amount of money available as matching grants to fix up the exterior of homes in older neighborhoods. By last autumn, about $93,000 had been committed to 23 projects with an average project value of $300,000.
“We’re getting pretty good bang for our buck,” Nutt says.
A housing survey revealed nearly 350 homes around Independence – nearly 10% of the city’s housing stock – are vacant. Of that number, perhaps 15% are not salvageable, Nutt says. The city and housing authority have committed $100,000 toward demolition projects in 2025, double the amount from the previous year, and Nutt says a similar figure will be needed in 2026.
Where possible, local officials want to renovate existing housing and resell it. The housing authority partnered with the Independence Land Bank to purchase five homes at a county tax sale. Volunteers and a local nonprofit are working together to completely remodel the interior of a three-bedroom house with more than 1,800 square feet that was built in 1915 on Pennsylvania Avenue, a main street leading into the heart of the city.
“It’s got great bones,” Nutt says of the house as she took a break from tearing out a second-story wall on an autumn afternoon. “We’re going to bring it back to life.”
The ornate woodwork on the staircase ascending to the second floor is staying, she says, but pretty much everything else is going. The goal, over time, is to convert dozens of vacant homes into modern housing, sell them at market value, and use the profits to help finance future housing renovations. The projects return existing houses to the tax rolls and reduce the need for new construction and the related infrastructure costs.
“It’s a big elephant” to revitalize these vacant houses, Nutt says. “We’re taking little bitty bites.”
Community Mission for Improved Housing, a local nonprofit, is helping low-income families in town with needs such as ramps, new roofs and projects to improve accessibility for those with disabilities.
Independence is just one of several cities in southeast Kansas where housing projects have gained recent traction, Ice says.
Along with Independence and Neodesha, Kansas Housing has projects underway in Pittsburg, Columbus, Coffeyville and Garnett.
“It seems like things are turning around” in southeast Kansas, says Ice, from Kansas Housing.
“We have a lot of irons in the fire.”
Revisiting ‘the American Dream’
There is no one blueprint that will work for every community seeking housing solutions, local and state officials say. Cities will need to figure out what works for them, but they don’t have to do it alone. Kansas Housing and other state agencies will provide technical assistance and other support as communities develop their housing plans, according to Jeanette Spurgin, deputy director of Kansas Housing.
Whatever answers they come up with, they will almost certainly require a reimagining of the American Dream, says Jared Wheeler, economic development director at Thrive Allen County. For almost 100 years, that vision was a two- or three-bedroom ranch house with a bit of land – an acre or more for a front and back yard and enough space so houses were not bunched shoulder-to-shoulder.
But the average home built in Kansas in 2023 was 2,200 square feet, Wheeler says.
“That’s a large house,” he says.
At even the modest cost estimate of $100 a square foot, he says, that puts the price at $220,000. That reality comes at a time when surveys have shown that a 30-year-old is less likely to purchase a home than at any time since the GI Bill was passed late in World War II.
Revisiting what the American Dream looks like is helping fuel the influx of people moving to Kansas – and smaller communities everywhere – in search of a better quality of life, Wheeler and others say. That, in turn, is driving the demand for housing that is being felt in Middle America.
“What is success, in the rural context, when it comes to your residential experience?” Wheeler asks. “It’s knowing your neighbors. It’s feeling safe. It’s having direct impact on community decisions that are being made. It’s being known and knowing people, and it’s feeling as though there are folks who are going to bear witness to your life, and that you will have the opportunity to celebrate and grieve with people like that.
“All those things are idealistic. … But I think that has to be our approach to what success looks like, as opposed to a three-bed, two-bath ranch house that sits on an acre and a half, because that’s really, really hard for the emerging workforce to access,” he says.
In place of those spacious ranch homes, he says, towns need to build more apartments and “creative housing stock items” such as cottage courts, duplexes and smaller homes that the emerging workforce can afford.
“Renting is going to become more popular by necessity, as this current economic reality persists and our emerging workforce shows a proclivity towards renting that they don’t show towards purchasing homes,” Wheeler says. “Adding rental stock is going to be so important.”
Capacity to be nimble
More than one rental property project is underway in Allen County, he says. For home buying to become a possibility, more homes need to be available between $135,000 and $170,000.
“We’re trying to pursue some creative solutions to that,” Wheeler says.
That includes offering incentives, such as tax rebates, for remodeling or revitalizing homes. Interest in “tiny homes” and prefabricated houses, where sections are built at a plant and then assembled onsite, is growing as well.
First Step uses Advanced Systems Homes, a modular housing builder in Chanute, for its projects, and Hammerschmidt says demand is so high “if he built five more factories, I think he could stay busy.”
MicroMansions in Columbus offers prefabricated homes with several price points and ranging in size from 500 to 1,300 square feet. Abby Nelson, the company’s founder, said demand for a new home for $150,000 or less “is very high right now.”
MicroMansions’ housing kits typically cost around $85,000, not counting the cost of the build out on site. Those added costs will depend on the contractor and the location, Nelson says.
“Our challenge right now has been finding the right contractor, and finding enough of them, to build out these homes around the country,” Nelson says. “We have a board full of 30 bids and almost all of them bottleneck waiting for a contractor to price or waiting for a contractor to start construction.”
Neosho County Community College has developed a construction technology program, and Allen County Community College has begun discussions about adding one as well. Growing the local construction workforce would help eliminate
the mobilization costs that come with bringing crews from outside the area, Wheeler says.
Iola and Humboldt are identifying city-owned lots for potential use as locations for infill housing at a specific price point.
Despite the long list of challenges, Wheeler says he is optimistic about the future of southeast Kansas. For example, a developer shifted his plans for projects in eastern Allen County to include duplexes and rental spaces along with stand-alone single-family homes.
“In southeast Kansas, it may take us a little bit longer” to get going, Wheeler says, “but the advantage of small communities and small groups of people really working together is they have the capacity to be nimble. They can make changes, and they can see which way the wind blows and throw their sail up in that direction, which is sometimes more difficult in an urban or suburban context.
“If we do not make changes, our population is going to continue to decline, which means the choices are going to be taken out of our hands,” he says. “If we want to retain our choice and our capacity to be intentional and creative, then we’re going to have to work together.”
This article was republished here with the permission of: KLC Journal