Studying local housing in Janesville

Editor

Tom Leighton, a senior urban planner with Stantec out of St. Paul, presented the results of a Housing Study of the city of Janesville during the January 9 council meeting.

The first thing Leighton pointed out is that Janesville has many features desirable to potential residents.  “There’s a real desire to live in Janesville,” he said. “It’s an attractive community. People like the schools, and you have great amenities.”

He added that this tends to create a shortage of housing: “The prices may also be out of reach for people interested in a town like this.”

The housing study was split into two main parts: Analysis and observations of the community (housing stock, for example), and tailored strategies to respond to the city’s development. Leighton presented a graph showing the employment growth in town. After a low point in around 2011 when 443 people were employed in Janesville, the number spiked to 630 in 2020.

“The job growth is not just in one sector either,” Leighton pointed out. “It’s in multiple sectors.

Janesville has also grown “modestly” - about five percent. Projections show it going down slightly from the current population of 2,421 to 2,339.

Leighton then presented a Venn diagram showing that 1,077 people live in Janesville and work elsewhere, making the city effectively a “bedroom community.” Conversely, 481 people work in Janesville and live elsewhere: Only 149 people both live and work in town.

Leighton was almost shocked by the demographics. “There’s a lot of children in Janesville,” he said. About 28.6 percent of Janesville residents are under the age of 17, while another 27.6 percent are age 35 to 54.

Those numbers were explainable with the next statistic, household types. Some 38 percent of Janesville households are families with children. “This is pretty unusual,” Leighton admitted. “But it fits the narrative that families want to live here.”

According to the measures of income, the median household income is $77,546. The average Minnesota household income is slightly higher, but Janesville’s median is much higher than that of Waseca County, which is at $63,498.

Leighton stated that Janesville is also an outlier in housing occupancy: 89.2 percent of city residents own their home, while the remaining 10.9 percent rent. Cities like Madison Lake and the entirety of Waseca County are closer to 80 percent, while only 72.6 percent of Minnesotans as a whole own their home.

Janesville had a wide range of housing types according to Leighton. The city offers mostly single-family homes but does have 4-plex housing, apartments, multi-family, and a mobile home neighborhood. In 2021, there were 16 single-family homes produced, much more than in recent years.

The current average single family sale price in Janesville is $139 a square foot, a 50 to 60 percent increase in only five years. “It’s not all bad,” Leighton assured. “If you’re owning, it’s good equity. But if you’re trying to buy in, it’s a lot harder.”

In summary, he explained that the city’s diversity of housing options is a strength, but that houses don’t remain on the market long.  “These days, new housing is occurring at a slower pace,” Leighton explained. “Development is challenged by rising construction costs.”

With the first part of the presentation out of the way, it was time for the suggestions. What should Janesville do?

Leighton said that the city should develop more multifamily and rent-restricted housing. He showed a comparison of what other cities were doing. Dodge Center, which is almost a Rochester suburb at this point, is currently developing 56 units of multifamily housing. Zumbrota developed 57 units in 2022, and Eagle Lake developed a total of 114 units in a two-year span.

He suggested the city get into a public-private partnership to get multifamily housing. “The typical format that cities do is develop places with a garage on the ground level rather than underground parking,” he added.

The rent restricted housing research may yield more challenges. “Models for affordable housing that are most common are competitive on a statewide basis and are likely not to occur in Janesville,” he said. “The way you can attend to this if this is a value is if you get a market-rate developer, dedicate a certain number of units, set aside for people under a certain income, subdivision development to target some of that mix to be more modest homes that are for more people.”

The subdivision strategies he covered for further development include things Janesville has already done. “Any time you can front load the utility costs, it helps,” he said.

For example, the city of Eyota went a few steps further by doing a city-owned development. They built the streets and utilities and funded it themselves. “The hurdle for developers was lower,” Leighton concluded.

He then talked about the mobile home park in town. “I care a lot about mobile home parks,” Leighton said. “Sadly, it’s all too common for people to buy the property and jack up the rates of rent in a mobile home.”

An organization in Rochester works to fix that problem by buying that type of property and running it as a cooperative. Leighton suggested Janesville could look into that or other ways to help out the mobile home park.

The last thing Leighton suggested as a strategy is developing land trust homes. The idea is that the price of the home is solely based on the building, not the value of the land. It’s the same when selling. Although it’s usually not as successful in most rural communities, the city of Mankato is giving the strategy a try.

After the presentation was finished, council member Ivan Maas was the first to ask a question. “You pointed out a lot of ways we could proceed. Are there any things that could lead us into a pitfall in the future?”

Leighton responded, “This is sort of all over the map. You may want to take on one or two at a time and reach out to communities that have done similar things and ask them about their pitfalls.”

Council member Melissa Kopachek expressed thanks to Leighton and his team. “I would be really sad if all this work goes for nothing,” she said.

Jim Mulcahey agreed. “I would expect between now and summer, we’d have a work session to go over this,” he said.

Terry Gardner, a member of the Janesville Economic Development Authority, was interested in how the study ties into the needs of daycare in town. “This is not just about housing, but making sure we get apartments with amenities and how it ties into the town’s growth,” she spoke.

The city will enroll in the Minnesota Housing Partnership Institute to further understand how it can potentially grow the city. With all the possibilities offered during the presentation, the city has plenty of options to choose from as it determines strategies to continue growing and keep up with housing demand.