Janet M. Atwood
Sylvia F. Barden
Fred J. Bryan
Sandra S. Eichelt
Elizabeth Jane “Betty” Frawley
John M. Macdonald
Rollin A. Natter
Carol L. Plante (Prochaska)
Michael P. Terry
Rollin A. Natter
The local housing market has tightened to the point that a typical ranch-style starter home might sell in the mid-$150,000 range or higher.
At least one hotel is catering to newcomers who could wait weeks or months to find an available house.
Multiple developers are pressing to build apartments at all ends of the affordability spectrum, and some residents are spending thousands of dollars on additions and renovations they hope will allow them to stay in their homes for a few more years.
A few local builders believe those phenomena are signs Janesville’s housing sector has reached a turning point in a nearly decade-long recovery after the Great Recession.
Still, one key part of the housing market—new home construction—has been sluggish to recover, at least at a rate that would keep pace with recent job growth and demand for housing.
That could change soon.
Doug Scott, a residential builder and developer who operates Amwood Homes and Advantage Homes in Janesville, predicts an uptick in new housing starts over the next two years, starting this spring.
He thinks that because his own companies plan to build 45 or 50 new homes next year—all in and around Janesville.
About half of those homes would hinge on the city annexing 20 acres of cornfield in the town of Harmony, between North Harmony Townhall Road and Huntington Avenue, Scott said. The new subdivision would bring about 43 new homes to the city’s northeast side in the next few years.
That’s in addition to housing starts Scott’s companies already have going in The Ridges, another northeast-side subdivision between Highway 26 and John Paul Road, and an idled condominium development that he plans to rekindle.
The level of home building Scott’s talking about amounts to about a 20% boost in housing starts for his own company, compared to the last few years.
If it was only Scott’s companies and no one else, the increase still would be significant. But other housing developments—most on the east side—are either in the works or in planning stages and will bring dozens more new houses in the next two years.
City officials say the local housing market has seen an average of only about 100 new homes a year over the last four or five years—less than half the average number built before the Great Recession. That has been one factor in a housing crunch that has hit Janesville harder than most other midsize Wisconsin cities.
Why? Land suitable for new homes is both relatively scarce and pricey. In addition, the cost of home building has made projects more selective. Many now are built for solidly middle-class residents looking to climb a rung or two up the property ladder.
The average cost to build a new home in Janesville this year ranges between $230,000 and $350,000, according to city construction permit applications. Sale prices are in the $280,000 to $290,000 range and up, according to a Gazette analysis of local listings for new properties.
Most new homes also average between 2,000 and 3,000 square feet—larger than a typical starter home.
Meanwhile, the average sale price for existing homes has risen steadily amid a dwindling supply—from about $155,000 in mid-2017 to about $185,000 earlier this year, according to a Gazette quarterly housing price analysis.
Scott said the narrowing gap between existing home prices and the cost of new homes has given homebuyers and builders a bigger incentive to build new.
Today’s buyers, he said, range from growing families with children to older adults who seek homes with one-floor, open layouts or large bedrooms on the first floor.
What’s different from building homes a decade ago, he said, is that lots are smaller: a half-acre or less. That’s in part because of the high cost of land.
Thus, the demand has pushed builders and developers to reactivate lots in idled subdivisions—or pay premium prices for land on the city’s outskirts to create room to spur new developments.
It’s a delicate dance, Scott said: trying to entice landowners to sell land for development and find homebuyers who’ll pay $250,000 or more for a new home. But he said the economy has seen sustained tailwinds the last two years, and more people have the money and interest in new housing developments.
“I’ve got a waiting list now for the lots we’ll be developing next spring,” he said. “So that makes me more comfortable going ahead” with other developments.
Three Roscoe, Illinois, builders have constructed more than a dozen new homes this year along Kells Way, a cul-de-sac just west of North Harmony Townhall Road. An Edgerton Realtor is listing one of those homes—a 1,400-square-foot, three-bedroom ranch—for $183,000, and the property is targeted at “first-time homebuyers or somebody looking to downsize.”
One of the Roscoe builders declined to talk about the properties, and another could not be reached.
Scott and another local builder, Brad Rein, said they’re familiar with the Roscoe builders’ development. They believe the builders plan at least 30 to 40 more homes in that subdivision over the next year or so.
Doug Marklein, a local builder and longtime city council member, said some builders are staying afloat by designing homes that are a little smaller on smaller lots—although some of the new homes have lavish or customized interiors.
Marklein said high-volume builders seem to have found a sweet spot in building homes people want to buy, despite land costs that average $35,000 per improved lot—about $10,000 more per lot than buyers would have wanted to pay 10 years ago.
Scott said he’s looking forward to a “big year” next year.
It’s not enough for Debi Pulver to say merry Christmas.
She has to fling her arms up in the air and proclaim it to the whole parking lot: “MERRY CHRISTMAS!”
That’s a lot of joy for a woman who has committed to ringing bells for the Salvation Army 10 a.m. to 2 p.m. five days a week in front of Hobby Lobby.
On Black Friday, Pulver was outside the store about 10 feet from the red kettle, cheerfully calling out “hellos,” “thank yous” and her trademark joyous Christmas greetings. Things have been going well for her. She’s been averaging about $63 an hour during her bell-ringing shifts, she has a wonderful boyfriend and she’ll soon been leaving Wisconsin for the balmy weather of Hot Springs, Arkansas.
Things haven’t always been this good.
Last year, her mother died. In the six years before that, her father died and her husband died.
“I’ve had seven years living with grief,” Pulver said.
After her mother died last year, Pulver was wrapping up the estate, and in order to get to certain documents, she needed to get her employee identification number. After struggling with the system over the phone, she thought she’d go directly to an IRS office. She was struggling financially, frustrated with the system and grieving.
“I had a meltdown in the IRS office,” Pulver said.
She was charged with criminal trespass and had to pay a fine and was sentenced to 25 hours of community service.
Pulver decided to ring bells for the Salvation Army in Janesville, where she didn’t know anyone.
She had so much fun ringing bells, she continued to ring after her community service was completed. Last year, she racked up 46 hours as a bell ringer.
“I had a blast,” Pulver said. “I love being around people; I love finding the Christmas spirit, and I love sharing the Christmas spirit.”
Pulver always greets people as they go into the store instead of when they come out. She doesn’t want to make anybody feel bad about not giving—or giving very little.
But people do give, and Pulver’s joy is infectious. Her greetings make people smile—and not just one of those polite smiles that look more like grimaces. Rather, people grin. Their cheeks pop, and their eyes light up. Sometimes, they even laugh a little.
It’s a good way to spread the spirit of the season, and it’s crucial for the Salvation Army and its programs. The red kettle drive is a significant part of the organization’s budget. The Salvation Army provides lunches throughout the year, presents for children in need, transitional housing for homeless adults, emergency assistance to families and a variety of other services.
ANN ARBOR, Mich.
James Daly is eager to make marijuana history Sunday, when he plans to open the doors to Arbors Wellness, beckon the lengthy line outside and legally start selling recreational pot for the first time in the Midwest.
“We’ve worked very hard to be prepared,” said Daly, who owns the medical dispensary that, for now, is among just six shops in Michigan—mostly in Ann Arbor—also approved to start selling for adult use in December. The business is doubling staff and has fielded calls from potential customers across the state along with neighboring Ohio and Indiana.
“The end of prohibition is historic,” he said. “We wanted to rip the Band-Aid off.”
Both Michigan and Illinois, which allows sales starting on Jan. 1, are officially joining nine other states that broadly allow marijuana sales. Companies are rushing to complete renovations at dispensaries, expand their growing facilities, and get staff hired and trained.
The Midwestern states’ launch into the potentially lucrative recreational market comes at a turbulent time for the industry, which has been rocked by layoffs, the vaping health scare and investor disappointment with Canada’s marijuana program.
In both states, a limited number of businesses have received state licenses letting them sell recreational products initially. But those same retailers must keep enough product on hand to supply people certified as patients under medical marijuana laws.
The conditions are “almost a guarantee” that Illinois and Michigan customers will experience long lines, product shortages and potentially high prices in the early stages, said Adam Orens, co-founder of the Marijuana Policy Group.
“They’ve got to get through the growing pains to get a system implemented,” he said.
Taking marijuana from a small cutting to dried flower ready to be sold or transformed into edible gummies or oils takes months.
In Michigan, where voters legalized recreational pot just over a year ago, regulators who began accepting license applications Nov. 1 are aiding the transition by letting medical growers, processors and dispensaries transfer up to half their products to the recreational side under certain conditions.
But marijuana is unlikely to be more broadly available until more businesses become licensed and additional communities authorize sales.
More than 1,400 of Michigan’s nearly 1,800 cities, townships and villages are not allowing recreational businesses. Even Detroit, home to the most medical dispensaries in the state, has delayed recreational sales until at least Jan. 31.
“This is brand new for a lot of municipalities. I think it’s important that they are doing their due diligence and taking an approach that honors the will of their people,” said Andrew Brisbo, executive director of the Marijuana Regulatory Agency, which has awarded 18 licenses and approved 78 pre-qualification applications.
He said he expects adult sales to occur in “some consistent form” at a greater number of Michigan locations by the end of March.
In Illinois, seven months will have separated Gov. J.B. Pritzker’s signing of legislation permitting people 21 and older to buy and possess marijuana and the start of sales in January.
The first round of applications is limited to existing medical marijuana retailers, and about 30 are newly licensed to sell recreational products. More could be approved before January.
Most of the state’s licensed cultivation companies are expanding their space to meet higher demand for marijuana products. But that work takes time, too.
Mark de Souza, CEO of the state’s largest marijuana producer Revolution Global, said he has heard from dispensary operators “panicked” that they could have empty shelves within months of adult sales beginning.
But he believes the overall structure Illinois’ law created will become the industry’s “gold standard.”
“You’re going to ensure everything from compliance to truth in labeling to taxes to consumer safety,” he said. “We don’t think any short-term supply issues are going to be harmful.”
Still, retailers are considering appointment-based systems rather than lining up customers in winter weather. Others have retrofitted their dispensaries to let medical patients in one door and recreational customers in another, hoping to limit confusion if their product supplies run low.
Amy Manganelli, chief operating officer at Mapleglen Care Center in the western Illinois city of Rockford, said she is anticipating long lines and taking steps to prepare employees.
“We can’t open January 1 and have somebody futzing with the scanner,” she said. “That won’t make the people in line, standing outside in winter, very happy.”
State law lets local governments bar recreational dispensaries, and at least two of Illinois’ existing medical dispensaries are in communities that decided to prevent expanded sales. Chicago set up seven districts with a limited number of dispensaries allowed in each, and business owners only learned at a lottery event in mid-November where they could operate within the city.
Illinois lawmakers said they expected a slow start. Their long-term goals, though, hinge on parts of the law intended to ensure people of color can open and work for marijuana businesses despite historic inequities in enforcement of state and federal drug laws.
The law includes a scoring bonus during the license-award process for social equity applicants—people living in communities most affected by enforcement of marijuana laws, or individuals arrested for or convicted of marijuana offenses that would be legal under the new law. A low-interest loan program for these applicants also was created as part of the law.
Michigan has cut marijuana licensing fees for prospective business owners living in 41 cities whose residents were disproportionately impacted by drug enforcement.
Toi Hutchinson, a former Illinois state senator who oversees the work of all seven state agencies that interact with cannabis businesses, said she is confident that regulators are hitting their deadlines.