In Case You Missed It: Noem Takes Steps to Increase Housing Availability in South Dakota
PIERRE, S.D. – This month, Governor Kristi Noem asked the Governor’s Office of Economic Development (GOED) to begin utilizing the Revolving Economic Development & Initiative (REDI) Fund to support multi-family, workforce housing projects.
“Everywhere I go in South Dakota, I hear from local business owners and community stakeholders that housing availability is an issue,” said Noem. “Businesses have good paying jobs available but struggle to get people to relocate to their communities because housing opportunities are limited. It’s a classic catch-22 holding back our communities. Developers are reluctant to invest because they don’t want to take on the risk of building homes and having them sit empty. And folks are reluctant to expand their businesses because people won’t move without good housing choices.”
“In the coming months, GOED will begin using the REDI Fund to address this need. Having suitable housing is economic progress, and I’m confident opening up this fund will get developers to invest in communities where additional housing units are most needed,” concluded Noem.
The REDI Fund is designed to promote job growth in South Dakota. The low-interest loan fund is available to start-up firms and businesses that are expanding or relocating, and local economic development corporations. For more information on REDI Funds, including eligibility requirements and the application process, click here.
I have never asked for this. I have asked for SD Economic Development to create and grow its own businesses, especially information systems and programming businesses, that will support the wages needed for the housing that is already here.
We should be restoring existing structures and having limited building in the Spearfish area. This top-down, command-style economy is a hallmark of China and the former USSR.
Ground-up, thoughtfully capitalized free-market entrepreneurship is the key to long term sustained economic growth. Attracting out-of-state companies to relocate here is whorish and unnecessary.
In my opinion, it’s an indication that SD leadership has an opportunity to trust and empower a group of very intelligent people who live here to develop a long-term sustainable non-predatory, free-market economy.
We don’t need to sell ourselves to the highest out-of-state bidder.
9/10 dentists agree, “Workforce housing” is just code-speak for “servant quarters”.
Let’s take a risk, participate in American culture, and develop a real grass roots economy that serves our population (not the other way around).
Non-tracking link to more info: https://sdreadytowork.com/financing-incentives/redi-fund/
What will this do to the current housing market?
If Spearfish is any indication, municipalities seem to be taking-on a “Housing Authority” that has an exceptional amount of government control over the development and ownership rights for the new properties. Who is an expert on this type of thing that could write a white paper?
If a white paper comes out I would love to see it.
I focused on the issue on my Internet broadcast this morning. I would love to know your thoughts. Email me (email in the broadcast) or reply here and leave your comments. I think this is an interesting and important issue that gives the opportunity to differentiate on principle.
https://plainstribune.com/podcast/?service=podcast.PodCastDetail&streamId=e7ee0456c63e6dd47d47b4b1e5db586c
The demand is not for single family homes; as baby boomers age and downsize there will be a surplus. With the boomers wanting to move into low maintenance apartments, the younger generation is competing for that same housing. In some communities it seems the apartment buildings can’t be constructed fast enough.
If the economy doesn’t support the ability for young families to purchase available housing, either the economy is broken, housing is artificially expensive, or both.
It’s a shame our unpatriotic multinational technology companies are outsourcing all of those six figure information systems jobs to India.
The biggest impediment to available housing (especially in communities where it is impacting job and economic growth) is time and cost to get through the permitting and construction process.
There was a time when it took a year or so to design a development, get it permitted, turn the dirt and another year for housing to be available.
Now that we have technology for digital plans, electronic means to distribute those plans, convert those plans to pipe, cement, wood, etc. orders, just in time inventory delivery of the materials, etc, it takes DOUBLE the time (and remember time is a significant expense).
If you are wondering why, 90% of it is planning, zoning, and approval regulations and procedures.
Rhetorical question: Why is Tesla worth more than Ford or GM?
Legacy procedures, institutions and practices. The market believes Tesla can ultimately be more efficient and profitable as it builds itself from the ground-up. A similar example is how Southwest came out of nowhere to become more valuable than the legacy carriers.
The only solution which will have measurable impact on solving the housing crisis* is when local governments re-engineer this process from the beginning to the end and where necessary the State adjusts so it is not an impediment.
* While related, the housing availability issue has four distinct challenges.
1). Multi-family which provides fluidity in the market, serves as the first home for new adults, new couples, and new people to the area.
2). Starter homes (a second level, not replacement) which can extend the time couples find it satisfactory. Currently, too many are designed with too few bedrooms which necessitates a sooner move-up as the family grows. This diminishes the attractiveness of starter homes.
3a). Forward-looking school boundaries. My quick review of the options of the new Sioux Falls boundaries in contemplation of the new schools opening make sense. For today. But, there are some very significant residential and commercial development projects coming on line in the next five years (see beginning of this post). When they come online, the boundaries in all the proposals will be out-of-date.
3b). Related to boundaries, they need to be properly balanced with regard to student profile to insure neighborhoods and existing housing stock doesn’t become less attractive. See #4 below.
4)Neighborhood revitalization and crime control to make certain areas and existing housing stock attractive to families.
You don’t address the above issues, it doesn’t matter how much capital is made available.
This strikes me as looking at the surface of the planet from low Earth orbit through a straw.
The big picture is that, before we should create a housing authority and start building-out low budget housing with totalitarian style price controls, we should fix our economy to state-izing (state level form of nationalizing) our software development jobs and other future-safe employment to make sure that the people have money in their pockets to drive the requirements of the market.
Ground-up vs top-down. Big picture vs little picture. Wide angle vs telephoto.
We need to be better seeing the big picture of economic interfaces. Then, housing takes care of itself (as do most other things in a fairly capitalized dynamic free market economy).
Do you realize nobody has proposed this?
Hi Troy;
Not sure what you mean by “this”. I’ve attended multiple city council meetings underpinning my description.
Noem’s announcement of this plan comes on the heals of a movement already underway.
Always interested in your thoughts.
Sincerely,
John
The following is not what the Governor has proposed and I know of no city that is proposing this:
“a housing authority and start building-out low budget housing with totalitarian style price controls,
See the Spearfish City Council meeting minutes from last Tuesday. Better yet, I think you can listen to the entire meeting online.
Perhaps you only disagree with some of my assertions you quote?
But, housing is a long lead time item.
“housing is a long lead time”
What about having a long lead time makes it acceptable for a municipality to behave as a micro-totalitarian state?
I don’t believe this is targeting larger communities. I think it’s the mid to smaller sized communities that don’t have developers and need more apartments or condos. Not everyone wants or can afford a house but needs a decent place to live. There are plenty of entrepreneurial people who would consider a small project in their community but the costs are just too high.
I’m not opposed to lower priced housing. But as I discussed with a very bright gentleman yesterday evening, we can’t go back and forth between socialistic and free marketistic. The switching costs are too high. Furthermore, socialism is doomed to failure in my opinion. That leaves one option .. we seem to be frogs in the stew with how Sturgis and Spearfish are approaching their housing projects (“authority”).
It’s not that I’m opposed to lower budget housing, but I have some personal convictions that stand opposed to the methodology. It is important to do things correctly (by US standards) by harnessing the potential power of our dynamic free market. I’m not seeing that as being the case, here.
It’s been a long time since I studied economic systems for my Philosophy degree in college, so please correct me if I’m wrong, but consider a housing authority that takes ownership of the subdivision, restricts the types of homes that can be built (not simply design standards or associative covenants), restrictions if/when the owner can sell, and restricts the total amount of profit from a sale.
This seems right in line with socialistic/communistic/totalitarianistic orthodoxy.
We do have a LOT of builders in the area. I wonder if we could have the “builder class” work together to build the homes they want. Using their own labor as input and purchasing lumber in bulk that is not marked-up by another builder, the costs have the potential to be very low, while the resale value has the potential to create a great margin for the builders.
It’s conservative yet progressive (lower case “p”) in a way that fully respects human agency and choice.
Some people can build/fix their own stuff. I say let them and don’t force them to buy it from the state or some huge corporation. Self sufficiency, resiliency, and ingenuity are hallmarks of the people who migrated here and survived.