ROCKFORD (WREX) — There are fewer new homes being built in the Rockford area.
It’s a trend realtors are hoping to change since new home construction is crucial to maintaining a healthy housing market.
“You typically see around 20 percent of the homes that are sold are going to be new construction,” Youssi Custom Homes owner Chris Youssi said.
Rockford’s housing market is well below the average with only 2 percent of homes sold in the last year being newly built homes.
More attention is being put into bringing fresh homes to the area, but a lot of costs are being evaluated as realtors try to make a change.
“Building materials have gone up, labor has gone up, code standards have gone up,” Rockford Area Realtors CEO Conor Brown said.
“While you still have some things hanging out there like impact fees where some communities still want to charge for that new growth even though it’s been next to nothing these past few years.”
Impact fees are money local governments impose on a new development to pay for public services to the area.
However, impact fees typically don’t factor into the appraisal of a new home, which means developers and home buyers pay those fees.
There are areas that have gotten rid of impact fees to improve their own market.
Poplar Grove did away with the impact fees and village leaders say it was a tremendous help.
“The more rooftops we add, the more taxes we add the more people have consuming and buying things. It’s just good for everybody else,” Poplar Grove village president Owen Costanza said.
The move cut building permit fees and is saving home buyers up to $30,000.
Rockford Area Realtors see this as encouraging since growth around the Rockford area will hopefully make its way to Rockford in time.
“We are seeing more permits being pulled around the region and some communities have taken a very proactive step in terms of attracting builders because the infrastructure is in place they want new residents moving in so we see that as a positive sign,” Brown said.
Less than 1% of Rockford’s housing inventory is new homes.