Just a few months ago, Shaey Moss and her children were living in a camper. Then, the camper burned down.
Moss and her three children were able to move into a mobile home in Hopkinsville. However, even though she could pay for the physical building, Moss couldn’t pay for the land in the trailer park it sat on, resulting in her getting evicted from the property. Now, the family is couchsurfing and staying in cheap hotels.
Since her eviction, Moss said she’s gone to about 10 different places looking for housing assistance. She’s looked to places like the Salvation Army and the local school system for help. The money she’s making while working at the local Hampton Inn is spent to help feed her family and keep them in temporary housing, which she said has made it harder for her to save up for a new place to live.
“In order to get a house, you got to have money, but you got to spend money to live, so that's the biggest problem,” Moss said.
Her struggle to find housing isn’t something that economic experts and local officials find surprising. In a study published earlier this year, the Kentucky Housing Corporation identified a need for 13% more units in Christian County than is currently available to meet the community’s needs. This translates to 3,430 rental and for-sale housing options – a number the organization projects will increase by nearly 1,000 units by 2029.
The Kentucky Chamber Center for Policy and Research also released a housing study this year. The study states that median home sale price in the Hopkinsville area increased by 82.8% from 2014 to 2023, along with a 66.4% increase in average sale price. Statewide in that same time period, the median home sale price increased 41% and the average sale price increased 36.8%.
The study also included data from the Harvard University Joint Center for Housing Studies, which showed that in the Hopkinsville-Clarksville metro area, the ratio of median home price to median income has gone from 2.4 in 1992 to 5.1 in 2022 – the highest ratio among Kentucky’s metropolitan areas.
Origins of the housing crisis
Chris Wooldridge is the director of Murray State University’s Center for Economic and Entrepreneurial Development and was previously a commercial banker. He said the current nationwide housing shortage is being caused by a variety of factors that have built up over the last two decades.
Wooldridge said aggressive lending leading up to 2007 and 2008 led to defaulted home loans that caused foreclosures, put a lot of homes on the market and then, construction of new homes fell by about half. This meant there was less need for contractors and people working for contractors, Wooldridge said.
“We drastically increased supply and demand, while it had fallen some because of the crisis, we still had a tremendous amount of supply on the market,” Wooldridge said.
According to data from the Kentucky Chamber Center for Research and Policy more than 19,000 building permits were issued on average annually from 1995 to 2007.
New construction in Kentucky dropped dramatically following the recession, the research group found. From 2008 to 2020, 10,361 home building permits were issued on average each year – a 45% decline from the previous period. While permits have picked up in recent years, they’re still not at the rates from before the 2008 recession.
At that same time, Wooldridge said the number of Kentuckians working as plumbers and electricians went down. By the time demand for new-build homes was back on the rise around 2018, he said contractors had harder times finding those types of workers.
“If you could find them, then the supply and demand of labor began to kick in, and that economic rule of ‘I want to pay you more to come work for me than someone else,’” said Wooldridge.
The COVID-19 pandemic added additional pressures to the housing market, when many started looking for bigger living spaces after spending more time in their homes during lockdown periods.
Another factor is inflation, which went up during COVID when the prices of most goods and services rose. As a response to inflation and unemployment data, the Federal Reserve, which oversees the US financial systems, raised interest rates.
This increases the costs of getting a loan from the bank. Before COVID, interest rates were at about 3%. In 2023, they were around 7%. Wooldridge said those who had homes with 3% interest rates are not going to be excited to move to a new home with a 7% interest rate, so they might stay where they are for longer – keeping houses that in other times could sell to other homebuyers off the market.
“All of that kind of creates this storm of we need houses and we need people to be able to buy them,” Wooldridge said.
Economic development’s role in housing needs
At the same time that current residents are searching for available housing, the Hopkinsville and Christian County areas are expecting to see some population growth in the next few years as several new economic development projects are coming to the area.
One is Ascend Elements Inc., which will work on batteries for electric vehicles and is expected to bring in around 500 jobs to the area. Another is Toyota Boshoku, which works on car parts and is expected to create around 160 jobs. The gas station chain Buc-ees also announced plans to open a location in Oak Grove, a Christian County community south of Hopkinsville - that’s another roughly 200 jobs. The Bradford Square Mall is also getting a revamp that will include a Rural King and an Ashley Furniture.
Carter Hendricks is the executive director of the Southwestern Kentucky Economic Development Council. The group, which focuses on Christian, Todd and Trigg counties, works to promote economic growth in the area by bringing in new companies and supporting area industries.
“Between those four different projects, you're looking at roughly 1,100 to 1,200 new jobs being created and just under $1.5 billion worth of capital investment,” Hendricks said.
This December, Cinis Fertilizer announced a new green fertilizer plant which would create more than 60 additional jobs.
With these large projects, Hendricks said one can assume that about 10 to 15% of the jobs would be offered to specialists that would need to move into the area. The rest, typically, would go to people already living there.
From Hendricks’ perspective, the relationship between housing and the growing workforce is about if the new workers will be able to afford the housing in the area, whether it’s in Christian County or nearby Todd and Trigg counties.
“One of the things we always showcase and highlight is that the average regional wages are higher than what is required to comfortably rent a home in this region, a two bedroom, one bath type property,” Hendricks said. “That's good news in that we can tell a company that what you're likely to pay your employees is likely to provide them a reasonable wage to afford housing in our region.”
According to data from the US Census, the average income is around $49,000 a year in Christian County.
Hopkinsville’s Mayor James R. Knight Jr. has some plans in his mind on what he hopes for the city’s housing future. Part of that plan includes his Growing Home Initiative, which helps remove dilapidated housing and promote public safety. Knight said the program is trying to address what it can.
“I'm looking in my mind about 200 homes, new homes in Hopkinsville or more,” Knight said.
Communities around Hopkinsville like Cadiz, Elkton and Clarksville, Tennessee are experiencing lots of growth and Knight said Hopkinsville needs to keep up with the growth, especially with more and more job opportunities coming into the area.
“With all these new jobs coming to Hopkinsville, we need places for people to live,” Knight said. “We don't need them living in other parts of the town, because if we're bringing up good paying jobs, we need them to be spending their money in Hopkinsville.”
Knight said low supply of housing – especially of options listed at or under $150,000 – can lead to bidding wars that can cause prices to go up when such a home goes onto the market.
“We got to get affordable housing here in Hopkinsville for the people to buy housing,” Knight said.
As Hopkinsville continues to expand, Knight said he appreciates any help they receive from the federal and state governments to assist with costs for things like expanding utilities.
Hopkinsville’s efforts to address housing needs
The city is working to address the housing needs in the community. Holly Boggess is the assistant director of Hopkinsville’s Community & Development Services (CDS), which is in charge of the city’s zoning. She also oversees Downtown Renaissance, a CDS incentive program to renovate downtown properties to put businesses downstairs and residential units upstairs. So far, the program has created six new housing units and 38 new businesses.
The dollars come out of a matching program where CDS will reimburse renovation expenses up to $10,000 if the property owners are creating upstairs residential units.
So far, nearly $14 million in private investments has been generated in this program. Just under $1.5 million in CDS matching funds have been. Of that, about $1.39 million have been approved and just over $1 million have been dispersed as of early October, Boggess said.
Other incentive programs for housing in Hopkinsville include:
- Rental rehabilitation program - reimbursement for renovations beyond basic property like energy efficiency or home aesthetic up to $10,000; 31 applications already complete
- New construction - different rebates for single family units and multi-family units or duplexes, depending on requirements met
- Land Bank Authority - nonprofit agency that accepts properties through donation or acquisition and forgives back taxes on property to sell to the community; 50 properties have been redistributed so far with the majority for residential use
- Lot Next Door - takes empty, abandoned properties and allows neighbors to enter a sweat equity contract, title is transferred after 12 months of maintenance
Incentive programs like the ones Hopkinsville is running are part of efforts recommended by the Kentucky Chamber Center for Policy and Research in their housing report. The report also recommended changes to land-use and zoning regulations, reforms to state regulations affecting homebuilding, creating reforms with regional collaborations, investing in infrastructure growth and helping grow the relevant workforce.
Boggess said Hopkinsville officials have been going through a comprehensive update of the city’s zoning ordinances for several months.
“The thing that we're looking at that will probably have the biggest impact on these incentives is reducing or removing – I should say removing the density requirements – in the downtown area so that additional development can occur on those upper floors without having to limit the number of units that can be developed,” Boggess said.
The city doesn’t have a specific goal or timeline because housing is dependent on supply and demand, Boggess said. The hope is to identify vacant properties and get them into the hands of developers.
“We realize, though, that there is a housing shortage in Hopkinsville, and we're working diligently to try to address that need,” Boggess said. “We have several new industries that are locating here, and we're very grateful for that. I think that the incentive programs definitely assist in trying to provide those housing demands that we're going to be seeing in the coming years.”
Housing creation under any project takes time. For example, Habitat for Humanity Pennyrile Region Director of Operations Brian Keith said it takes about 18 to 24 months for a home to be built from the time a family fills out an application. They’re also facing a lot of the same cost factors private home builders are seeing.
“Really just with inflation, the cost of everything, cost of construction pre-COVID, we're probably seeing close to a 40% increase in construction cost overall, not just in lumber. Everything has gone up,” Keith said. “Really, access to land, cost of construction, those are our two main problems.”
Habitat for Humanity’s program model builds homes for families after their application is approved. However, they don’t give these homes away. Instead, they set up a no-interest mortgage with the receiving family, allowing the nonprofit to act as the bank for the family.
“We consider our program a hand up, not a handout. We do sell the homes, typically at zero interest and an affordable mortgage for the family, but they do make monthly mortgage payments on it, just like a traditional mortgage,” Keith said.
Homes are sold at the appraised value. The organization doesn’t want to underprice the home and bring down surrounding property values.
Before the tornadoes in December of 2021, Habitat was building five to seven homes in the region annually. In the two and a half years of building since, there’s been about 45 homes built. While Keith doesn’t think they won’t be able to maintain that rate, they are hoping to land at about 10 to 12 homes built in a year.
This kind of wait time doesn’t work for people in immediate need. Even temporary housing options are running out of space. The local Salvation Army confirms their women and family shelter has been at capacity for months.
Circumstances like these don’t work for families like Shaey Moss’s, who need housing now, whatever it looks like. The places that Moss said she feels like are in her budget are one bedroom units, which she could make work but isn’t ideal for her and her three children. The cost of any type of rental unit that Moss might find right now could also cause her to cut other things from her budget like her insurance and her phone, which she needs for work.
She’s also dealing with application fees when she does apply for places with available units. Moss thinks she’s spent about $500 on application fees, with the highest being around $80 and the lowest being around $35.
“I’m hoping to get into something soon,” Moss said. “Anything’s better than nothing, right?”
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