Eighth Street Project: Affordable New Construction
In the 1990s, the prevailing sentiment among developers was that a new house and an affordable house were not the same thing. The cost of construction, the cost of land and the cost of materials put the price of a new home out of reach for first-time homebuyers. SDHDA wanted to show that it could be done.
"We were told you couldn't build affordable homes for less than $100,000," said Brent Adney, SDHDA's director of Homeownership. So SDHDA launched a pilot program in Pierre to show that constructing affordable, new homes was feasible.
Working with the City of Pierre and the Pierre Economic Development Corporation, SDHDA acquired four building sites on Eighth Street and drew up blueprints for a split-level, 1,768 square foot home. Each home had two bedrooms, a two stall garage, an unfinished basement and central air conditioning. SDHDA hired a young contractor, Kelly Vosberg, to build the homes.
Vosberg remembers the Eighth Street project well. He had only been a building contractor for about five years at the time. He didn't even have a company name yet. "My brother and I built all four houses," commented Vosberg. "It was a good starter for us. It got our names out there."
SDHDA staff handled selling the completed homes. All four sold quickly for $72,000 each, well below the $100,000 price that had been predicted. The homes appraised at $82,000, giving the new owners $10,000 equity in their homes.
For Kevin Rokusek, his Eighth Street home was a good starter home. He moved to Pierre to work as a program analyst. He researched SDHDA's First-time Homebuyer program, but found few houses in Pierre fell in his price range. "At the time, there wasn't a lot of affordable housing in Pierre. It was tough for a first-time homebuyer. This was a good deal," Rokusek stated. He is married now, now resides in Sioux Falls and is still a program analyst and a homeowner. "Eighth Street was a really good program; it got me started," said Rokusek.