An interesting phenomenon is occurring in many rural spaces: Even though the population has been steadily declining for the past 50 years, there has been an increase in the number of households. Kelly Asche, a research associate for the Center for Rural Policy and Development, wrote in an April 2018 report that population and housing are not as clearly linked as one might think.
Asche pointed to west-central Minnesota as an example.
“That region has experienced the most significant population decline since 1970. I wanna say it’s lost 20 to 30 percent of its population since that time until today,” he noted. “What’s interesting though, if you look at the number of households, it’s actually increased by 4 percent or 9 percent. It’s just this idea that a household sizes are smaller.”
And, there are jobs in rural areas, but in order to hire people for those jobs, there has to be somewhere for them to live. “So you would think a simple solution to that then is, ‘Why don’t we just build more housing? If there’s demand for it, developers should come in.’ Well, there’s a couple problems. One, building house today is very expensive,” Asche said. “You talk to a lot of experts and they’re gonna say minimum, the cheapest house you can build is probably $200,000.”
Also, developers who build that $200,000 house can probably sell it for that much in rural areas, but if they build their $200,000 living space in a metropolitan area, they’re probably gonna turn a much larger profit. Asche also said that the Great Recession wiped out many small contractors who would be more likely to build housing infrastructure in rural spaces.
“So this whole mixture of stuff, along with just not having a lot of housing stock because we haven’t built a lot of housing in rural areas for the past 30 years, there’s no housing available.”
So what can be done about all of this? Asche introduced this idea of “housing churn” and explains why it’s not enough to just build more houses. There needs to be diversity in housing availability.
“In a really healthy kind of housing market, you’ll see people move at all these different points in time,” Asche said. If your kids graduate, you might move to a smaller house. If you retire, you may move to a smaller house. You want single-floor living, but not senior living, you might to a different house. “And during that time you’re constantly going to a new place, but then opening up the housing that they left, and they call that churn.”
Cue the Riverview Estates living development project in Dawson, Minnesota. Recently, a group of people who invested in the project, Peggy Crosby and her husband, David Peterson, Charlie Prestholdt and Ken Club gathered in the Dawson city hall. “One of the aspects of the mission statement was to provide quality, affordable housing for the City of Dawson,” explained Club. “And secondly, to try to facilitate with local vendors and suppliers, whenever it was financially feasible.”
You can find Riverview Estates less than a mile from city hall. The idea for Riverview Estates started in late 2016, after three world real estate visionaries—Club, Prestholdt and Lee Gunderson—saw a need for more affordable housing in Dawson. Their idea was pretty straightforward and it sounds a lot like this idea of housing churn: purchase eight lots from the city that could be resold to people who could build their dream home, which in turn would free up their previous homes in town for new occupants. With lots ranging from 11,000 to almost 31,000 square feet, they estimated that the project would cost $350,000–$600,000. They fanned out and approached 10–15 people to invest in their project.
The investors also worked with the city. “We had property to sell and they came to us,” said Dawson Mayor Randy Tensen. “They lined up an investment group and then we developed the water and sewer in there and then we sold them the land, but they only had to pay for it after they sold the lots.”
The investor group came up with three floor plans for potential buyers. All of the plans have flex building options which gives the purchasers the freedom to come in at any point of development to modify the plan. The Cottage home option is about 1300 square feet, The Fieldview plan about 1500 square feet and The Falls option comes in at around 1800 square feet.
The investors’ original intent wasn’t to have Riverview Estates turned into a retirement community of sorts, but with their one-floor patio slab homes, that’s what’s starting to happen. The residents of the first five houses in Riverview Estates come from other houses in Dawson. Those houses are now available for new families. The first churn cycle is starting to happen.
Doc and Sharon Skordahl, both retired, were one of the first to purchase a lot. They decided to move from their home of over 60 years in Dawson to Riverview Estates because they liked the idea of having everything on one floor, no steps. That was key.
“We sold our house, it’s about four blocks from here. I had lot of steps to go up and down all the time,” said Sharon. “So when we decided to make a change, we thought about going to an apartment and then our son thought we should be in a house. So here we are.”
Doc really liked many of the features of his new abode, but the top two were that the houses could be modified, so they’re all different. There’s no cookie-cutter situation going on in Riverview Estates. And there’s plenty of yard space without the yard responsibilities.
“So I don’t wanna own a lawn mower or a shovel. And I like it,” Doc said. “And then right across the road, we got a walking trail. So it’s used a lot. And we like that also.”
Talking with Doc and Sharon, even after a year and a half of living in their new home, they seem just as excited as the day they moved in. They show that Riverview Estates is a beautiful example of the potential for housing churn in rural communities.
This story is part of the SoJo Exchange from the Solutions Journalism Network, a nonprofit organization dedicated to rigorous reporting about responses to social problems.