Oshkosh housing experts say region must build its way out of housing crisis

OSHKOSH ― Just lowering the mortgage rates alone will not solve the housing crisis.

Two key figures in the industry believe Wisconsin has to “build its way out” of the nationwide problem by creating more lots and units while providing more diverse housing options.

Both the Realtors Association of Northeast Wisconsin Director of Public Relations and Government Affairs Jennifer Sunstrom and Winnegamie Home Builders Association Executive Officer Jodi Vandermolen shared the view while detailing the ongoing dilemma.

“We’re thousands and thousands of units behind where we should be right now and that’s because we’re underproducing lots and housing units over the last 10 years,” said Sunstrom.

“So the only way out is for us to build our way out, but that’s easier said than done, because there have been so many contributing factors over the last 10, 15 years that have created the perfect storm resulting in where we are right now.

“But we need housing, and we need a lot of it, so we also have to increase the diversity of the houses we create to meet people where there are in life, and that will mean creating smaller lots and giving people more affordable options,” she added.

Some real estate experts believe the US housing market is on the verge of a crash.

The situation isn’t peculiar to Wisconsin, as some real estate experts say the U.S. housing market is on the verge of a crash with sky-high home prices and existing mortgage rates doubled those of 2020.

What is for certain is that there’s a sales recession that has seen a huge drop in mortgage demand and existing home sales.

Sunstrom said it's been a perfect storm created by banks deeming real estate development as toxic, a labor shortage in the building industry, supply chain issues and the rising cost of building materials.

And that has directly slowed building in Wisconsin, particularly in the northeast region, where less than 50% of the housing demand is currently being met, according to data from the Housing Now Coalition.

Only 25% of current listings are identified as being affordable to middle-income families, with the median sale price of a single-family home in Winnebago, Brown and Outagamie counties increasing from $163,950 in 2018 to more than $279,000 last year.

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Lowering interest rates would help increase the demand for mortgages, but Sunstrom points out that will merely create bidding wars for existing properties, as new homeowners enter the competition without a house to put on the market.

“We can say we have to build our way out, and we do have to, but the price of lumber, concrete and materials have gone up, so getting product is also an issue now,” Vandermolen explained.

“And now everyone is shorthanded in terms of manpower, even for the builders, so three years ago you could have a house done from start to finish in sixth months but now it may take nine months, if not longer.

“But we definitely have to help lower income people get on their feet with more affordable housing, and you’re starting to see that in Oshkosh as government helps with this situation, but it will take a long time for us to get out of this,” she added.

The current crisis isn’t lost on local governments, either, as many counties have either put together task forces, compiled studies or documented strategic plans to address the housing shortage.

Outagamie County did a study showing the region needs to build 10,000 to 17,000 affordable units by 2030.

Outagamie County did a study that shows the region needs to build 10,000 to 17,000 new affordable units over the next six years.

In 2022, the City of Oshkosh worked with a consultant to outline a comprehensive housing needs assessment and strategy plan.

“We were really shocked by the information we found, so we committed funds to implement the recommendations in that plan and, of course, one size doesn’t fit all, but we need more housing units, period,” said City of Oshkosh Community Development Director Kelly Nieforth.

“So, we removed a lot of barriers in zoning code, reduced minimum lot size, reduced the minimum parking requirement, we made it easier to develop duplexes in zoning districts, created language to allow accessory dwelling units and we’re looking unique ways to offer different solutions.

“We looked at housing financial assistant programs to see if they were effective and if the funds allocated were meeting needs of the market, so we made changes in those housing programs and we’re seeing success,” she added.

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Last year, Wisconsin Gov. Tony Evers signed five bipartisan bills that created and expanded four loan programs though the Wisconsin Housing and Economic Development Authority.

The grants total $525 million and are meant to help support the creation of affordable housing across the state.

“The real estate market has drastically changed, so we have to change how we think about housing, and that means offering way more diverse options,” said Sunstrom.

“All homes help, so we need more condos, townhouses, duplexes, zero lot lines and all different housing types to meet people where they are at their place in life.

She added, “But one of the problems we face is 'NIMBY' or not in my backyard, where people acknowledge we need these lower income housing options, but they don’t want them built near them.”

Have a story tip or public interest concern? Contact Justin Marville at jmarville@gannett.com.

This article originally appeared on Oshkosh Northwestern: Oshkosh housing experts: Region must build way out of housing crisis