MARION — When Chad Pelley began a career in development in 2001, much of what the native Marion resident and civil engineer saw being built were ranch homes with three-stall garages on large lots.
“Everybody was doing the same thing,” he said.
That lack of diversity in housing choices became apparent to community members, particularly after the city of Marion performed a housing study in 2016.
It showed that participants, including community members and those with a stake in the issue, believed the real estate market to be saturated with single-family homes and single-level condominiums for sale.
The study also outlined other issues and opportunities — like only limited aesthetic choices, a lack of units at both the high and affordable price points, and a shortage of rental units.
More recently, changing demand by those looking for housing and higher land prices have led the housing stock in Marion to become more varied in price and type.
“Obviously from a business standpoint, that diversity of housing is good. I think if there’s one area that Marion can improve on, it’s offering more diversity in the type of housing opportunities that we offer. And we’re really starting to see that shift here locally in our community,” said Nick Glew, president of Marion Economic Development Corporation.
Pelley, now a business development manager of Ahmann Companies, is finishing up a development of more than 90 high-end rental condos just east of Highway 13, called Sunny Ridge Townhomes. The two- or three-bedroom units come with high-end finishes, like granite counter tops and attached garages, Pelley said.
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“It’s been a strong, solid market over there. I think there was some pent-up demand, obviously.” Pelley said. “I think that your market and homeownership is changing as such that folks are willing to look at other options like a town house or an attached condo or an urban loft, and that’s across the board at all age groups. It’s just evolving.”
Pelley said he believes providing more higher-end rentals in the market will relieve some of the downward pressure created by tenants in lower-priced units who could otherwise move in to something more.
Thomas Treharne, community development director for Marion, said housing stock diversification can be difficult for cities to accomplish themselves because it’s often driven by the market, and zoning codes are set up to support single-family growth.
But as developments come online, Treharne said, the city might take a more “integrated approach” to encouraging housing diversity by steering properties near collector streets to only higher-density buildings.
“So if someone buys a property and just expects to develop it as all single-family, that may be something that we will encourage to happen differently,” Treharne said.
As Marion nears the 50,000 population mark needed to receive a direct allocation of housing funds like Community Development Block Grants from the Department of Housing and Urban Development, Treharne wants to start preparing the city government to provide housing programs to better engage residents.
Treharne said he envisions Marion may one day create landlord licensing and assistance as well as information programs for renters, among other efforts. He also hopes to start a conversation on inclusionary zoning, which requires a certain number of affordable units for new developments in a particular zone, similar to an Iowa City rule.
Iowa City passed an inclusionary zoning ordinance in 2016 for its Riverfront Crossings district. That requires 10 percent of units to meet affordability guidelines for at least 10 years — or else the developer must pay a fee that’s applied to other affordable housing.
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For now, though, Treharne said constructing more affordable housing in Marion requires a developer with knowledge of how to use state and federal funding programs. Those grants allow for new developments to offer quality units at affordable rates.
In Marion now, that affordable housing gap is too often being filled now by low-quality, low-priced units.
“That’s not the way it should be. There should be the ability for folks to have a decent place to live,” Treharne said.
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