McAllen Sees Decline in Permits for Residential Construction

6 years 4 weeks 1 day ago Thursday, January 25 2018 Jan 25, 2018 January 25, 2018 11:38 PM January 25, 2018 in News

MCALLEN – Construction in McAllen will continue despite the lulls in activity. Where homebuyers may see the difference is in availability and price.

For over 40 years, the purpose of Affordable Homes of South Texas is to help low-income families purchase their lot of the American dream.

Deputy Executive Director Ken Dejarnett says the need continues to this day.

"We have 300-400 families a month," he said.

They buy and build in large tracts of land to sell at-cost.

However, Dejarnett said, "Those days are gone for us and certainly in the affordable housing."

These past few years, finding properties is an increasingly challenging task. They became resourceful resorting to scattered site-building.

He explains, "If you look there are large number of vacant lots and lots with old deteriorating home in the downtown area."

City data CHANNEL 5 NEWS analyzed says overall permit activity went down for residential construction. The number of certificates declaring a residence was in compliance declined from 521 in 2016 to 249 in 2017. That's 52 percent less.

There's another way the city measure growth. McAllen City Manager Roy Rodriguez says they track the amount added to the tax base. It reflects a similar decrease.

In 2014 and 2015, they brought in about $200 million for each year; but 2016 was exceptionally good.

Rodriguez says the city attributes that to, "an IDEA Academy, a waste water treatment plant that went up, obviously La Plaza Mall."

Then the city went from $405 million down to $215 million in 2017. There are some notable culprits.

"Dirt in McAllen is more expensive," explains Rodriguez.

McAllen also faces land-lock issues. He says, "We all know that we're surrounded by cities around us east and west and to the northeast for that matter. So our growth corridor is north and northwest."

Construction in that far part of town is ongoing for upscale subdivisions like Tres Lagos. The land is more accessible there but still not within the reach of Affordable Homes clientele.

Dejarnett explains, "The only negative about that for us, particularly with the lower and moderate-income families, is they need transportation to the work areas."

Affordable Homes continues to strive to build between 75 to 100 homes this year as they do every year. They'll just have to adapt to the challenges to stay in the market.

Dejarnett says they are now working in Rio Grande City, Mercedes and San Antonio not only because of the need in those areas but because the land is also more affordable.

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